Brand Building in the Age of Activism
Updated: Aug 1, 2022
Building a brand used to be much easier in the old days before we had supercomputers in our pockets and Millennials roamed the earth.
A company simply had to create a unique identity that consisted of emotional and rational elements, then add design components like a logo and packaging, and finally develop communication that was delivered in a consistent manner across a limited number of channels. Voila!
It’s true that brand building became more complex with the advent of digital technology, but this was due more to the fragmentation of media and the need to communicate consistently across multiple and disparate offline and online channels. Perhaps, the bigger shift was that companies had to reconcile with no longer being in control of how and where consumers consumed content, and be prepared for a two-way relationship. It required brands to become more flexible and learn how to develop meaningful relationships, on their customers’ terms. However, the fundamentals pillars of brand building still pretty much remained the same.
Now, a new generation of socially conscious consumers are pushing companies to re-write their brand building playbook. Consumers expect companies to take a stand on social and political issues. 86% of people want CEOs to speak out on issues like the pandemic, automation, racial justice and climate change. They also expect private companies to help solve societal problems that in the past were squarely the domain of governments and nonprofits.
Every business still needs to be profitable to survive and none are equipped to act like an NGO. So, how do CEO’s and companies successfully build brands in this age of activism?
Not too long-ago companies were able to get away with cursory statements, or by appending a hashtag, and get credit for showing support. After last summer’s racial justice protests many companies again issued statements in support of black employees and used the #BLM hashtag (Black Lives Matter). I did a quick analysis of the executive leadership at twenty of these companies and found they had a grand total of four black executives, accounting for an abysmal three percent of senior leadership.
This fact was not lost on consumers. Criticism from the court of public opinion was swift and harsh, for everyone from Apple to Allbirds, and was not restricted to customers. Former employees at a number of companies took to social media to call out hypocrisy. The message was loud and clear - words ring hollow and count for nothing unless they are backed with tangible actions.
It is fair to say that ESG (Environmental, Social and Governance) is now table stakes for brands. However, those that pay lip service or offer fuzzy platitudes will be penalized, which was not the case before. Take the fashion industry which has been making loud noises about reducing their carbon footprint for years, but have done little by way of offering tangible metrics and measurable goals. The fashion industry remains the second biggest polluter on the planet, more than air travel and maritime shipping combined.
Companies will no longer be able to get away with obfuscating or soft-pedaling the realities of where they stand. Nor will they be able to get away simply with writing cheques. Only brands that have the courage both to share internal hard truths, publicly and transparently, and to follow through with real actions that have positive impacts in the communities they serve, will benefit.
Companies need to start by acknowledging how far behind they are, as the majority will be, on issues ranging from increasing corporate diversity to reducing carbon footprints. Next, they should solicit feedback from multiple quarters, including former employees and external critics, before presenting an honest assessment. Such an assessment is useless unless it is accompanied with an action plan that has measurable metrics and realistic timelines to affect change.
Rather than being faulted for acknowledging their shortcomings, these companies will be lauded. But those who wait to be pressured by employees and customers or mandated by the SEC to begin disclosing corporate diversity figures and other ESG goals will be punished.
To be clear this is not about altruism; it’s smart business. Edelman’s Brand Trust survey finds that US brands are 4x more likely to gain consumer trust when they take action on social issues. We are also seeing consumers across generations voting with their wallets, with 64% of people saying they are willing to switch or boycott a brand based purely on its social stand.
Brands that take the lead on these issues will see the positive results reflected not just across society, but also in their bottom-lines.