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Why some brands shun purpose and honesty

Monday, 20 June 2022
Why some brands shun purpose and honesty

Current trends suggest consumers value honesty and right behavior highly.

Assuming that’s right, how does this translate into approaches to marketing? Over 2022 we surveyed 7,000 consumers and 600 marketing leaders about their perspectives, to discover where they agree or disagree on this topic.

Customers do value brand purpose (where a brand takes an ethical, sustainable, or political stance), with close to half (47%) saying it’s important to them.

We also discovered a strong alignment between CMOs’ marketing objectives and the benefits of purpose. CMOs say that improving loyalty, increasing sales, winning new customers and building a reputable brand are the top four benefits when thinking about both purpose and marketing objectives.

It’s for this reason that three in five (59%) of CMOs promote purpose to some extent. But almost a quarter (24%) do not.

When we dig a little deeper, we find a small group of marketers resistant to purpose and even honesty.

Avoiding purpose

Of the 24% that do not promote brand purpose, almost half of them (10% of the total surveyed) do not promote any kind of ethical, sustainable, or political stance.

There may be good reasons for brands to take this approach.

We know that there are five main barriers to adopting purpose and many of the reasons that emerged show that many brands are nervous about the problems of adopting purpose authentically and the dangers of perceived inauthenticity.

This preoccupation can act as a disincentive to adopting brand purpose until the brand’s concerns are met and dealt with.

Keeping away from purpose

When asked how important brand purpose is to their customers, seven in ten (70%) of CMOs say that purpose is important.

Conversely, 19% say that purpose is unimportant to their customers.

When clarifying their stance, 14% of the total say that brand purpose is ‘not relevant’ to their customers. Simply – these CMOs say that their customers do not care.

This is a familiar refrain – of respondents seeing their job as producing a specific product or service, and purpose as irrelevant. This is an increasingly untenable approach if half of consumers (47%) value purpose.

It could be that those companies who believe purpose to be irrelevant for their customers map perfectly onto those consumers who have no interest in purpose either (7% of consumers say purpose is ‘extremely unimportant’ to them).

But this is unlikely.

Honesty is not always the best policy?

The research shows a stubborn proportion of CMOs resisting not just purpose, but honesty. One in eleven (9%) CMOs say honesty is not important to their customers.

Conversely, 80% of CMOs say honesty is important to their customers.

We know that customers believe strongly in honesty, with the overwhelming majority (94%) of consumers say honesty is important to them.

It’s therefore difficult to empathize with the position of this 9% of CMOs.

If honesty is not important to customers, what does that mean? That CMOs can mislead about their product or service and customers will not mind?

This seems a very risky strategy, but this strange result seems to show that this 9% does indeed believe brand honesty is overrated.

By contrast, CMOs reveal a litany of dire outcomes for those participating in dishonest marketing, including poor reviews or ratings (46%), reduced sales (42%), negative word-of-mouth (35%) and reduced loyalty (30%).

So, dishonesty is risky. But this stubborn 9% disagrees.

The risks of dishonesty

When asked about the risks of dishonest brand marketing, this 9% who say there are no risks, are joined by another 21% who say the risks of dishonesty are ‘negligible’.

Could there be another way of examining this? Could it be that some marketers see dishonest businesses ‘getting away with it’? Possibly. Here it’s necessary to separate two sets of respondents.

First are the ‘cynics’ who are suspicious of brand purpose, and even of honesty, in marketing. These respondents may produce misleading marketing, but see no penalty for doing so.

Second are the ‘pragmatists’ who can perhaps see dishonest brand marketing occurring from the ‘cynics’ and see no penalty for those cynical brands’ dishonest marketing.

Essentially, the first group produces dishonest marketing while the second witnesses that dishonesty, and sees few consequences.

One company known to have been dishonest in its operations is Volkswagen, which in 2015, was exposed as having misled regulators and consumers about the environmental performance of its diesel vehicles.

Their ‘clean diesel’ was marketed as exactly that – a clean and responsible choice. The company had in fact been falsifying lab tests for up to seven years using a special piece of software that could spot when a test was underway and reduce emissions for the duration of the test, leaving a lasting false impression.

This was a sophisticated and considered piece of dishonesty. Not only did the scandal hit Volkswagen’s brand hard, but it was also subject to fines of up to $61 billion in the US alone, and its CEO quit.

As mentioned above, the penalties for dishonest marketing can be severe, as Volkswagen discovered.

A path through

One in 12 (8%) of CMOs follow this pattern:

First, they do not promote an ethical stance in their marketing – they are part of the 24% who do not promote an ethical, sustainable, or political stance.

In addition, they believe that their customers are not interested in brand purpose, which is true for 19% of the total – this group represents almost half of those who are skeptical about the relevancy of purpose for their customers.

Finally, this group believes honesty and transparency are important to their customers. In this case, they form part of the majority opinion.

There is a paradox here. If a company decides to be more transparent about its operations, this strategy only works when there is good news to tell.

If the company uses, for example, slave labor, it’s difficult to see how more transparency would be a good outcome. Unless they abolished slave labor in their supply chain.

This is the opportunity for these brands: by clinging to honesty and transparency, and letting the implications of that play out, this shows a possible route towards more brand purpose.

By being more transparent, this should in turn drive greater responsibility and purpose.

If you'd like to read the full report Brands that take a stand: Marketers who match consumers’ desire for purpose and honesty come out on top, why not download your free copy today?

It's quick and easy, just click the link below.


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