Why Start-ups too need a Brand Purpose

It is now generally understood that large, long-established companies benefit from deciding on a Brand Purpose. It contributes to setting up a common goal, helps to re-focus brands that have diversified over time, and more globally unifies all stakeholders behind a common direction. 

Ernst & Young and the Harvard Business Review co-authored a research project which revealed that 58% of companies that are truly purpose-driven report 10% growth or more over the past three years, versus 42% of companies that don’t have a fully embedded purpose reporting a lack or even decline of growth in the same period.

But start-ups, who usually begin as a small team of highly dedicated people, often think they don't need to define a purpose. This can be explained by the fact that founders and managers of start-ups are simultaneously dealing with a multitude of tasks on strategic, organizational and operational levels. 

They often bear their project for a long time and don't think they need to sit and write down what their brand will bring to the market, what their relevance is for their customers, and more generally what their role will be in the economy for the future.

Wrong.

Their business's purpose is what customers, retailers and investors will be interested in when they will be looking at their brand.

Times are changing and companies, regardless of their scale, need more than ever to stand out in a noisy, distracted world. They need to give customers and retailers a reason to choose them over the dozens of similar brands on the market. 

Business now is not only about selling products or services. It's about connecting with customers to serve a purpose or solve a problem. When deciding what brands they will do business with, today's customers are looking for more than just the goods or services they provide — they care about what impact they are making in the world. 

Millennials and Gen-Z, particularly, will be looking at the values, beliefs, and social orientation of the brands they purchase. 69% of Gen Z think brands should help them achieve their goals and over half of Gen Z consumers consider how trustworthy a brand is before buying it.  

It is also important that what a brand communicates is genuine. In January 2021, a bad buzz hit French jewelry brand Lou Yetu, which was accused of a false claim of “made in France” and having terrible working conditions. An occasion to remind that Gen-Z consumers are also more likely to boycott brands (40% compared with 16% of Millennials according to IPSOS).

For the founders, having a Brand Purpose will operate as a compass when deciding between different strategic or operational routes. It begins by adding a “why” to the usual questions of “what”, “how” and “when”, as exposed in Simon Sinek's famous TED Talk “How great leaders inspire action”. 

Building a brand is no longer a one-way street. Successful brands know that they need to create lasting and branded impressions to stay both on top of mind and top in the consumer's hearts. 

In a fast-changing, highly competitive and saturated world, new brands need to have a Purpose that is strong, authentic and differentiated, and to be able to deliver this purpose through a consistent brand experience at every touchpoint. This is how they will leave their customers with branded, distinctive memories and make sure that they will choose them over their competitors, not only once but again.