Helping you understand what it means for a business to operate with a purpose beyond profit.
A purpose-driven business is one that is focused on its higher purpose and greater good beyond just making a profit. In a world recovering from the pandemic that faces constantly shifting challenges, businesses and companies of all sizes can help individuals, society and the environment with a purpose beyond profit mindset.
The notion of higher purpose might feel a bit esoteric to some people, but this type of business is very clear on why it exists and the impact it wants to have in the community or around the world. In this post, we will explore the importance of being purpose-driven and the benefits it can bring to your business.
I’ve noticed in the last decade, more and more businesses have started on the purpose and impact journey of merging their approach with environmental and social goals in mind.
As a result, the lines between the public, private, and social sectors have blurred. This shift has led to a rise in sustainable businesses, increased community involvement, and a greater awareness of social responsibility – I believe all good and necessary aspects of running an ethical business and contributing to the betterment of the world. But the vast majority of businesses do not operate this way and in my opinion, the pendulum needs to keep swinging in the direction of more purpose-driven businesses, with the benefit being to our people and planet.
You might have heard other terms for a purpose-driven business including mission-driven or impact-driven business. The terms are interchangeable when referring to a business that is focused on achieving a specific mission or purpose, helping to make the world a better place through societal impact, beyond just generating profits.
Why should a business be purpose-driven? Here are 5 key reasons:
1. Attracting Customers
Customers are increasingly looking to buy from companies that align with their values and beliefs. By being purpose-driven, your business can appeal to those customers who share your vision and are more likely to support your brand over the long term.
Why do your customers care if you are a purpose-driven business?
Today’s consumers are increasingly socially and environmentally conscious and are looking for businesses that share their values and contribute to the greater good. Here are some reasons why customers care if a business is purpose-driven:
- Emotional Connection: When a business has a clear purpose and mission, it can create an emotional connection with customers. Your customers want to support businesses that share their values and beliefs and that make them feel good about their purchases. Give them a reason to choose your business!
- Trust: Purpose-driven businesses that are transparent about their values and impact create trust with customers. Customers want to know that your business and other brands they love and support are authentic and have a positive impact on society and the environment.
- Social Responsibility: Impact-driven companies that prioritize social responsibility and environmental sustainability appeal to customers who are looking to make a positive impact with their purchases. The shift in business I spoke about earlier, speaks to customers who want to support businesses that are committed to making a difference in the world.
- Loyalty: When your business creates a meaningful and positive impact on society it can generate customer loyalty. Customers are more likely to become repeat customers and brand ambassadors when they feel that they are part of a larger movement or cause.
- Meaningful Purchases: Your customers are increasingly looking to make purchases that align with their values and beliefs, and what they care about is changing. Impact or purpose-driven businesses offering products or services that contribute to a greater cause or mission can appeal to customers who are looking to make meaningful purchases.
For more statistics and reports, visit our resources page.
Case Study Example: Salt Spring Coffee.
This a great example of a Canadian company hitting all the marks. As a customer, would you support them knowing this? I sure would (if I drank coffee that is).
- We roast to inspire change and we recognize the impact that the coffee industry has on farmers and ecosystems.
- We’re committed to being a force for positive change in the coffee industry.
- Our goal is to support people and natural systems to thrive along our entire supply chain, from seed to cup.
- We carefully consider the big-picture impacts of all of our decisions to make the right choices for the best outcomes in the communities and environments where we operate.
- We’re committed to imagining what’s possible to help our customers, employees and farmers lead better lives and thrive.
- Change takes root only when we work together. We want customers, suppliers and farmers who are willing to learn, work hard, innovate and collaborate with us to realize our vision.
2. Engaging and Attracting Employees
Let’s face it, without your employees, you have no company. How better to attract and retain top talent than by giving them a reason to love your company and clamour to work for you and stay with you? That’s the power of ‘purpose’. When employees are clear on the purpose of the business and the impact it wants to have, it can help to improve their engagement and satisfaction.
Mission or purpose-driven businesses can provide a sense of meaning and fulfillment to employees beyond just a paycheque, leading to increased productivity, loyalty, and retention.
Your employees want to work for a business that shares their values and beliefs. When you prioritize social responsibility and environmental sustainability you can attract employees who are passionate about making a positive impact on the world.
Why do your employees care if you are a purpose-driven business?
- A Sense of Purpose: Your employees can feel a greater meaning and purpose beyond their paycheque. Increasingly, employees want to work for businesses that have a positive impact on society and contribute to a greater cause or mission.
- Employee Engagement: Greater employee engagement is fostered by providing employees with a meaningful and fulfilling work experience. When your employees feel that they are part of a larger movement or cause, they are more likely to be engaged and committed to their work, have longer employment, and recommend your business to others.
- Team Cohesion: Greater team cohesion is strengthened by providing employees with a shared sense of purpose and mission. When your employees feel they are part of a larger movement or cause, they are more likely to work together and support one another in achieving their goals.
Using the Salt Spring Coffee example, do you think they have an engaged workforce all working toward the same mission and vision? 100% they do!
“We understand that a fair wage takes care of our employees’ basic needs and provides the discretionary income required for a decent quality of life. We also recognize that excessive work is detrimental. To support the health needs of team members, we limit overtime and provide a Wellness Benefit that can be used for things like a gym membership, yoga lessons or a bike. We know that an authentic connection with the communities where we live and work supports wellness. As of 2015, employees can take advantage of up to 24 hours of paid time each year to volunteer with any of our 1% for the Planet partners.”
According to a Porter Novell’s Purpose Study, 61% of employees choose, leave avoid, or consider an employer based on their values and beliefs.
For more statistics and reports, check out our resource page.
A clear purpose can help your business stand out in a crowded marketplace by providing a unique and compelling reason for customers to choose your products or services. It can help to differentiate your brand from competitors and create a stronger connection with customers.
Here are some ways you can help differentiate your business as a purpose-driven business:
- Unique Value Proposition: As a purpose-driven business your unique value proposition sets you apart from competitors. By focusing on a social or environmental mission, you offer a unique and compelling reason for customers to choose your products or services over those of your competitors.
- Emotional Connection: The emotional connection you create with customers by aligning with their values and beliefs, helps to build brand loyalty and differentiate your business from competitors.
- Authenticity: Businesses that are authentic in their mission and values can differentiate themselves from competitors who may be seen as less genuine in their commitment to social or environmental causes. Be authentic. It creates a deeper connection with your customers and builds trust in your brand.
- Innovative Solutions: Businesses that are focused on solving social or environmental problems develop more innovative solutions; this sets you apart from competitors. By leveraging your mission to drive innovation, as a purpose-driven business you can differentiate your brand and create a competitive advantage.
- Positive Impact: To have a positive impact on society will differentiate your business by appealing to customers who are looking to make a difference with their purchases.
The coffee industry is a crowded marketplace. Salt Spring Coffee company customers are loyal and massive brand ambassadors because of what the company stands for. If, as a consumer, you knew the stories behind their commitment, education, and financial support to their farmers, would you feel different about choosing their coffee beans over another? Probably.
A Store of Hope
It’s not only about fields and coffee farms: we need to look at entire communities. Take, for example, the women of the Soppexcca co-operative in Nicaragua, who work long hours sorting coffee beans at the mill. Many of them walk to work, leaving few hours in the day to shop for family necessities. As a result, the women were routinely buying food and goods from roadside vendors in small quantities and at high prices. In 2010, with funds from our Fair to Farmer program, the women opened a mercado, or store, steps away from the sorting mill, creating a safe environment where they can buy what they need at a manageable price. Watch the video here.
4. Long-term Success
By having a clear purpose and vision, your business can create a strong foundation for long-term success. This helps to build resilience and navigate challenges (like a pandemic!), and industry disruptions more effectively.
Here are some ways in which being a purpose-driven business can lead to long-term success:
- Clear Direction: As a purpose-driven business you have a clear and compelling purpose. This provides a clear direction for your business, guiding decision-making and strategy development. This purpose keeps you focused on long-term goals and objectives, and avoids short-term thinking that can hinder long-term success.
- Innovation and Growth: Purpose-driven businesses drive innovation and growth by leveraging their purpose to identify new opportunities and solutions. This could lead to the development of new products and services, expansion into new markets, and increased revenue over the long term.
- Supply Chain: Purpose-driven companies often look up and down their supply chains, making changes to reflect their commitment to people and the planet.
- Outperform Other Businesses: Brands with a high sense of purpose have experienced a brand valuation increase of 175% over the past 12 years, compared to companies without a strong sense of purpose, according to Kantar Consulting’s Purpose 2020 report.
5. Positive Impact
Finally, a purpose-driven business has a positive impact on society and/or the environment. By focusing on creating value beyond just profit, your business can contribute to the greater good and enhance your reputation in the eyes of customers, employees, and stakeholders.
Learn how Salt Spring Coffee is “innovating to sustain because we only have one planet”.
Some Final thoughts
Being purpose-driven is essential for businesses and companies to thrive today. Conducting business this way helps to pave the path forward not only to attract customers, but also to engage employees, differentiate your brand, and create a foundation for long-term success. In addition, and definitely not a separate outcome, is the positive impact on humanity and our planet – no matter what social, economic or environmental cause you choose to champion. By focusing on a higher goal beyond just making a profit, your business can fulfill a meaningful and fulfilling purpose that can drive success and growth for years to come.
Want help to become a purpose-driven business? Business 4 Social Good™ helps to define your purpose, create impact, and change the world, through training in our Social Good Academy™ with other like-minded entrepreneurs in a group setting, or consulting one-on-one. Our clients learn how to have a purpose-driven focus on a triple bottom line to achieve profits in ways that are better for people and the planet, making decisions that positively impact their people, customers, suppliers, community, and the environment using the power of their business as a force for good.