The 2020 Zeno Strength of Purpose Study, a global study analyzing the business value of brands has found that consumers are four to six times more likely to buy from, trust, champion, and defend companies with a strong purpose.
The study surveyed more than 8,000 individuals across Singapore, Malaysia, China, India, the United States, Canada, United Kingdom, and France. As part of the study, consumers rated their perceived strength of purpose of more than 75 brands. Researchers then performed a correlation and regression analysis to understand the relationship between consumers’ perceptions of a brand’s Purpose and their attitudes and intended behavior toward them.
- Four times more likely to purchase from the brand;
- Six times more likely to defend that brand in a challenging moment;
- Four and a half times more likely to recommend (champion) the brand to friends and family;
- Four times more likely to trust the brand.
In core markets in Asia, the study found that consumers in Singapore, Malaysia and India were most likely to buy from a brand with a strong Purpose; France and the UK emerged as the countries most likely to trust, champion, and defend a brand with a strong Purpose. The survey also found that the benefits of a strong Purpose held across regions and generations, with 82% of consumers saying they took action to support a company or brand when they believed in its Purpose, sharing positive opinions of that brand with others, encouraging others to support or buy it, or starting to buy from the brand themselves.
The inclination for consumers to act against brands or companies they disagreed with was stronger in Asian countries, while in the United States, Canada, France, and the United Kingdom, consumers were slightly more forgiving of brands when they disappointed.
“Asia has a long and strong tradition of companies and brands acting with purpose beyond profit,” said Paul Mottram, Regional President, Asia Pacific, Zeno Group. “Today, we can back that up with clear proof that purpose and profit are closely related. Every company needs to ask itself not just what’s the ROI of a commitment to purpose, but also what are the risks and costs from not taking it seriously or relying purely on philanthropy.”
What is Purpose?
Respondents were asked to identify the top attributes of purposeful brands and revealed eight key elements:
- Fair treatment of all employees
- Products or services that reflect the needs of people today
- Ethical and sustainable business practices
- Support for important social causes
- Creation of new job opportunities
- Diverse and inclusive culture
- Issue advocacy
- Strong set of values
In Asia, consumers rated making “products and services that reflect the needs of people today” as the top element of a purposeful brand. In North America and Europe, respondents ranked “fair treatment of employees” as the number one element of a purposeful brand.
The Purpose Paradox
According to Zeno, consumers have “raised the bar and are looking to companies to advance progress on important issues within and outside of their operational footprint.” The study found that 94% of global consumers say it is important that the companies they engage with have a strong Purpose.
“However, a significant gap exists as only 37% believe companies today actually do,” said Zeno, adding that, “83% of consumers surveyed globally said companies should only earn a profit if they have a positive impact, implying consumers have developed an expectation for brands and companies to have a higher calling beyond earning profits and rewarding shareholders.”
“The data proves that consumers expect companies to have a more meaningful reason for being and are making decisions about what to buy and where to work with an eye toward supporting those that share their values,” said Alison DaSilva, Managing Director, Purpose & Impact at Zeno Group.
“Yet, companies are leaving equity and opportunity on the table as the majority of consumers do not believe companies today have a clear and strong Purpose. It has never been more important for companies to not only articulate their Purpose, but to consistently demonstrate that Purpose in how they operate, support issues and engage with all stakeholders.”
Holding Brands Accountable
The study also highlighted the so-called “cancel culture” with nearly eight-in-ten (76%) of global consumers indicating they will act against brands whose purpose, values or behaviors they disagree with, by “no longer buying from the brand, switching to a competitor, or discouraging others from buying or supporting it,” said Zeno Group.
“Asia has a long and strong tradition of companies and brands acting with purpose beyond profit.”
The cancel culture behavior appears strongest among younger generations, with 88% of Gen Z and 85% of Millennials saying they were more likely to act negatively towards a brand they disagreed with. Primary actions included sharing their opinions with family and friends, whereas Boomers and Matures were more likely to act with their wallets, saying they would stop buying from the brand altogether.
The inclination for consumers to act against brands or companies they disagreed with was stronger in Asia countries (China, 92%; Malaysia, 91%; Singapore, 89%). Meanwhile, in the United States, Canada, France, and the United Kingdom, consumers were slightly more forgiving of brands when they disappointed.
Younger Generations: Valuing Purpose
Younger generations were most likely to champion on behalf of brands with a strong Purpose the survey found:
- 92% of Gen Z and 90% of Millennial respondents say they would act in support of a purposeful brand – at least 10 percentage points higher than other generations surveyed.
- 87% of Gen Z and 84% of Millennials state it’s a CEO, Founder, or Owner’s responsibility to drive a brand’s Purpose – six-to-three percentage points higher than all respondents.
- 70% of Gen Z and Millennials feel a brand should have a Purpose they personally believe in – 22 percentage points higher than Boomers and Matures.
- Across all survey questions, Gen Z led all generations in their positive affirmation of a brand’s Purpose.
“When it comes to Gen Z – teens and 20-somethings – the stakes for brands couldn’t be higher, as many of these young people are in fact their own brands. They expect brands to live their Purpose with action and to responsibly and consistently wield their economic and social power for good,” said DaSilva added.
“Gen Z’s number one ambition is to build a better world through the strength of collective action. Those brands that do not put authentic and actionable Purpose at their core risk losing one of the most influential youth generations on the planet.”