Purpose. It’s the new buzzword that can either make or break your business.
Just ask executives at Volkswagen, who saw car sales tumble following a greenwashing scandal that clearly proved their inability to back up the company’s sustainability credentials.
Or talk to the team at TOMS, whose mission-driven narrative is now famous for helping the company skyrocket to success.
In an effort to win over more customers, larger organizations are sometimes quick to jump the gun on promoting their positive environmental and social impacts. But unless they can actually back up these claims, it’s not unusual to see this strategy self-destruct.
I’ve spent the last year interviewing purpose-driven startup founders for my blog globesprouting, many of whom built their businesses around a social or environmental ‘purpose’ from the beginning, and there’s plenty that larger companies can learn from them.
Following are some of the top things these purpose-driven startups are getting right, especially when it comes to driving customer loyalty with their positive impact business models:
1. Collaboration
The world is big – and so are the social and environmental problems that we’re all facing.
So please don’t be that singular company that’s going to save us all from imminent destruction – it’s arrogant, unrealistic and doesn’t instill any sense of community, like, you know, the kind you’re trying to develop with your customers!
Instead, consider partnering with other organizations who have similar goals. One of my favorite examples in the startup world is the collaboration between Indosole, Bureo and Mafia Bags. Their business models are all dedicated to upcycling materials to keep them out of landfills and instead of competing, they’re openly supportive of each other.
Because if you’re REALLY dedicated to that cause, then the more the merrier. You’re trying to make the biggest positive impact possible, remember?!
2. Practicing what they preach
I almost wasn’t going to include this as I feel it’s so obvious, but then I keep hearing about companies getting caught out and felt it was worth repeating.
If your company publicly labels itself as ‘ethical,’ then please make sure you can back up this claim.
You’re probably already well aware of companies like H&M, whose fast-fashion philosophy doesn’t seem to match up with their Conscious clothing label and recycling efforts. Even if you can’t back up your ethical claims right now, a better strategy would be to publicly commit to making improvements, rather than constantly trying to defend your current position.
And remember, being ethical goes way beyond just your supply chain.
How you interact with customers or even just respond to emails says plenty about how devoted you are to being a purpose-driven business.
I was really impressed recently when I received an email from the founder of a startup that helps people recycle used clothing – just to thank me for subscribing. This is the type of customer service sure to cut-through the clutter, in a good way!
3. Incorporating more than just the ‘one for one’ donation model
TOMS is probably best known for its One for One donation program which ensures a pair of shoes is donated to someone in need for every pair purchased.
So it was pretty revealing to see founder Blake Mycoskie talk recently about evolving this model even further into something more sustainable for disadvantaged communities. Beginning in 2013, TOMS began manufacturing shoes in markets where it also makes donations, helping to fuel job growth and create a longer-lasting impact for communities in need.
While I’m certainly not knocking any company that donates to disadvantaged communities, taking a more sustainable approach that increases employment opportunities and access to health or child care, is definitely a sign that your company is genuinely committed to making a lasting positive impact.
4. Building an authentic sense of community
I can’t tell you how totally DEFLATING it is to work with so-called ‘mission-driven’ companies who talk about ‘creating communities’ and then just expect people to volunteer their time – without even a ‘thank you’ in return.
If you’re building a community, then please show that you actually care about other people!
When I noticed recently that the team from purpose-driven startup Wize Monkey were in Nicaragua, it made sense, as that’s where the farmers who grow their coffee leaf tea are based.
But when I saw them talking about extending their commitment, beyond just helping famers to also supporting local street artists, they won over my immediate respect for going WAY above and beyond to extend their positive impacts to the wider Nicaraguan community.
5. Being 100% transparent – about everything
Clothing company honest by is 100% transparent about everything to do with their clothes - from the materials to the manufacturing to the way they calculate their prices. Way ahead of their time, I’d love to see more companies follow this approach.
As a GRI (G4) sustainability reporting trainee, when companies choose not to disclose certain information or have their report third-party assured, I always question their commitment to being truly ethical. And then I, along with many members of the public, have to wonder – why even bother in the first place?
Rebecca Cressman is a PR & Communications Consultant and the Founder of globesprouting, helping purpose-driven entrepreneurs launch and grow their business. Follow her on Twitter @becmann