Tips For Building A Purpose-Driven Business

Every business has a shared purpose of making money. But for many business owners, it’s about more than revenue and profits; it’s about making a real difference in the world by introducing a product or service that will improve people’s daily lives. At its core, a purpose-driven business operates on the principle that its existence serves a larger cause. This could range from addressing social issues, like poverty and education, to environmental concerns, such as sustainability and conservation. The key is that the purpose is genuine and deeply integrated into every aspect of the business, from decision-making processes to product development and customer engagement.

Purpose-driven businesses are better positioned to grow than those that are not focused on a specific purpose. Brands perceived as having a highly positive impact, defined by their purpose, experienced 175% growth over 12 years, according to The Kantar Purpose 2020 Study. In comparison, brands perceived as having a low purpose grew 70%, and brands perceived as having a medium purpose grew 86%. Whether you are a seasoned or aspiring entrepreneur, understanding how to build a purpose-driven business to overcome challenges can help you create a world-changing company poised for growth.

The Fundamentals Of A Purpose-Driven Business

“To build a purpose-driven business you have to first define your core purpose and values. You should be able to clearly articulate why your business exists beyond making a profit. What positive impact do you aim to have on your customers, community, or the world? Once you’ve defined your purpose, let it guide all aspects of your business,” says Leah Dergachev, Founder & Chief Storyteller of Austley, a hybrid marcom agency and consultancy.

Some companies find their purpose through their vision or mission statement. Others have a purpose from the beginning because they were built to solve a particular challenge. “When my daughter was born with a rare genetic condition that robbed her of the instinctual ability to breathe, I had no choice but to get creative and develop tools that would help improve her quality of life,” explains Micheal Londo, CEO and Founder of Body Balance System, which makes red light therapy beds.

“There are a lot of ways that we can create the future we want to see through our businesses, like being thoughtful about who we hire, how we pay people, and what we buy. If you’re thinking about how to integrate purpose into your business, I suggest starting with your vision for the future: What is your north star in terms of making an impact? If you could change one thing about the world, what would it be?” says Lis Best, Executive Coach and Founder of Girls Club Collective, a feminine leadership lab.

She adds, “From there, you can work backwards: How is your business uniquely positioned to contribute to that vision? What are some of the biggest opportunities for leverage or positive impact that you have through your products or services?”

21st-century consumers increasingly seek brands that align with their values. “Today’s consumers are digitally confident and purpose-driven. They’re informed and focused on finding brands that align with their values. They’re demanding more across the board, and companies will have to raise the bar to pass muster,” says Karl Haller, Global Leader for the IBM Consulting Consumer Center of Competency. Haller led a study for IBM that found that purpose-driven consumers (defined as those who choose brands and products in alignment with their personal values) represent 44% of all consumers, the largest segment.

A purpose-driven business model not only appeals to this demographic but also cultivates loyal customers and dedicated employees. People want to buy from and work for companies that positively impact the world. Furthermore, a strong, authentic purpose can differentiate a business in crowded markets, offering a unique selling proposition that is not easily replicated by competitors.

From Purpose-Driven Product To Purpose-Driven Culture

Shifting from creating a product for a personal purpose to building a business requires intention. “Purpose-driven organizations succeed when their purpose is authentically aligned with strategy and operations,” explain Rodolphe Durand and Ioannis Ioannou in The Harvard Business Review. “Overall, leaders shoulder the responsibility not just of directing their organizations towards purpose but of enacting it daily. Their actions, decisions, and communications set the example for the broader organization, accentuating the importance of purpose in everyday reality.”

“I had one goal in mind at the start – saving my daughter and helping her live a healthy, productive life,” says Londo. “My struggle to find well-designed products in the medical industry inspired me to get into this business. We aim to deliver a high-quality, affordable product that can help people live healthier lives. Every decision we make comes back to this overarching intention, and we live our values every day in the way we interact with our employees, customers, and stakeholders.”

Building a purpose-driven business is powerful for companies that want to stand out from the crowd. By defining and integrating a genuine purpose into every aspects of the business, companies can foster a resilient culture, build brand loyalty, and make a meaningful impact. While the journey requires commitment and adaptation, the rewards – in terms of business resilience, customer engagement, and societal impact – are profound.

In an era where challenges abound, purpose-driven businesses stand out as beacons of hope and innovation, demonstrating that success and societal contribution can go hand in hand.