How has the economic downturn impacted Brand Purpose?
A lot has happened since our first Rival Spark report on Brand Purpose back in June 2022. As the economic downturn unfolds, purpose, specific issues and what it means to consumers will change with it. Our most recent wave of research, 'Pragmatic Purpose Revisited' checked back in with US / UK consumers to understand how economic worries will impact their perception of brand purpose.
We found that there is an emerging charitable intent gap which advertisers will be tempted to fill, but should do so cautiously. Marketers will be excited that the data show that a majority of consumers still believe brand purpose is important.
In fact, on many issues, consumers expect brands to lead - being more engaged than they personally are. Health, Economic & Environmental issues are areas where shared progress feels most achievable - with consumer and expected brand engagement closest. Areas such as Legal & Business issues alternatively, are seen as places for a brand to ‘get their house in order’.
The economic downturn has shifted how consumers perceive different issues. Between June and the end of october, we’ve seen an increase in every issue towards being more of a ‘shared purpose’.
However, while consumers expect progress on issues they care about, economic pressure is going to make price & product even more important vs. brand purpose. Purpose may be a thankless task for many brands in the short term. When asked to rank the importance of purchase factors, purpose lagged far behind price, product usage & performance. It stands as a value multiplier, not a creator.
However, that doesn't mean brand purpose is pointless. Instead, considering its value more holistically, as an internal north star and point of pride, an employer brand tool and as a long term investment in multiplying more functional value is key.
Our model from June stands true in the economic downturn - with brands needing to consider if they should focus more on societal citizenship & creating a path to neutrality during the coming hard months or whether now is a time to centralize a more positive direction at the heart of the business and business model.
For either, pragmatically approaching purpose, not trying to save the world tomorrow or use it as a way to drive immediate sales - will still be the best way many brands can think about it.