 The manufacturer that is a physical ownership in the sense that you put it on your goodwill sheet Or you put it on your balance sheet or you put it on packaging But the true ownership of brands is actually in the minds and hearts of consumers. That's the first as you think about purpose Second every brand every company every CEO is now saying my brand is a purpose Is this what I call the do sir? This is the straight one the catch being just because you have a purpose You're not going to grow and I think that's very naive marketing and very naive thinking and very naive You know explanation to say my brand as a purpose it will grow and I'll explain to you why it's very naive The role of marketing and management has always been to propagate new ideas new concepts and broadcast them because The whole of management has been an intellectual pursuit Okay, we've always tried to analyze why something works why something doesn't work Put the best together and then propagate it either by an article or a book or a session like this That's what we've always done. So let's take a few things that we've heard in the past So I just take two of them and I I know that the exceptions But it's always good to look at them just to say where we've gone wrong. So number one We've always been told that if a company has more women on the board it does well Okay, we've always been told there are lots of empirical evidence lots of professors Maybe we should have put all board members of jet airways as women, right? Then maybe we would have saved that airline, right? I don't know Okay, so that this correlations in my book and I take time. It's not that easy Second we've always said innovation matters if you're an innovative company, you last forever and you'll do very very well Let me give you a great example of this Okay, and Ron was the most innovative company for a few years and number one The month before most of his leaders went to jail Okay, the most innovative company on the list blah blah, etc. Every single list till Jeff's killing everyone went to jail Okay, so the point is just because you have a tag called innovation You have a tag called women on the board. You have a tag called purpose does not guarantee you business or success That's my point. You have to do a lot more If you look at the great entrepreneurs of the past the Tatas the bill last Lord leave a Hume procter and gamble Cadbury you look at all of them. They had purpose Only thing is they didn't have social media. They didn't have people like you They didn't talk about it. That's all they all had purpose. What was their purpose? Their purpose was I live in this society. I will build a school for this society I'll build a library for this society. I'll employ employ people from this society and I will build my company So they were rooted in the society that they were born to They didn't say my purpose or something like that, but they naturally did it and it came naturally to them So that's one of the things we need to really think about Purpose is not something which dawns on us. We have to commit to it and we have to do it So do consumers truly understand this word called purpose or is it good copy for analysts shareholders and activists? That's my question So as I say is it just plain prose which is collecting a bunch of words putting it together to say I have purpose Let's look at it. So what did I do? Before I go there one warning. I'm not saying that purpose is unimportant. I'm not saying that at all What I'm saying is having a purpose doesn't guarantee success. That's all I'm saying Because this commentary which I hear is that I have a purpose and I'll grow. I don't believe that at all It happens to grow. That's a different matter. There is no correlation between Purpose and growth. That's my point So let's go. So I did a survey to check for myself Okay, can't our is the sponsor here. So I did a survey to check for myself whether consumers understand purpose number one and Do they understand the purpose of a few brands which we live with every day? That's what I did So let me give the results of it. So I asked consumers. What do you understand my brand purpose? Front and center was a big word called product in the word cloud So whatever consumers want they're saying get the product right Product is absolutely front and center Then people are saying this you have a certain pursuit. You have a certain trust You have a certain quality. You have a certain betterment, etc They come next but front and center is absolute number one is quality Then I asked for commentary to say Explain in words what purpose means to you this I just put a sample of them. This is what consumers said One consumer said not sure I mark the reds. No idea. Maybe it's to make money Some people think that fair the green ones Brands that serves some purpose of a greater good vision of the brand Brands intention of making a contribution to the world brands purpose to me personally is the very essence of brand existence So there are both sides It's not that the moment you say purpose everybody switched on and you know gets it right like price the moment You say price everybody knows what the answer is But purpose at least at this point of time people don't know Then I then I looked at some of the stats Half the consumers across the world say we will drop a brand if it's unethical That's to be expected in today's social media world The moment brands get unethical consumers say I don't want to deal with you. That's fair. You know, that's absolutely right second 91% of global consumers are willing to switch to a brand that supports a cause other things being equal Remember that other things being equal is the mandatory phrase other things have to be equal now. That's Pepsi Cola I'm sure all of you have read about it I was there in Pepsi when this happened Jenner Kendall and the ad of a can of Pepsi Cola trying to change the race relations in America Consumers are not stupid. That's what we learn. Which is my next race, which is Most consumers believe that brands cannot solve society's problems even if they claim to do so For example, can a brand solve the poverty problem in India? The answer is no Can any brand solve the traffic problem in Bangalore? The answer is no No, so you can claim what you want But consumers are clear that society's problems are the problem of society and the government Brands can profess to say what they want, but they don't truly believe it Which exactly what happened with the Pepsi can and the you know the race war in America? Because we were saying it's a big problem, but your brand can't handle it So if you look at purpose think of three things one what the world needs Second what you're good at third what you're passionate about The intersection of these three gives you some idea of the purpose that you should pursue That's where you will be the intersection of these three What you're good at what you're passionate about and what the world needs the intersection of this has Fertile area for you to discuss purpose So I checked a few examples. I checked three examples with consumers number one uber So what I have over over the next nine slides for each brand. What is the uber purpose as stated by uber? What do consumers take out in the word cloud as their understanding of the uber purpose Similarly for Apple similarly for Indian Express and you can see for yourself. There is some fit. There's not some fit So let's take what is uber's brand purpose? How many of you use uber at least once a month? Whole room. What do you think is uber's purpose? To to cheat people very good next anybody else don't Google it because I'm asking you Ah Convenience of ride now. Here's a bunch of very high IQ people right you guys are not upwards of 150 You don't know what the uber brand purpose is but you use it and that's the point I'm trying to make as long as it's convenient. It makes sense. You'll use a product or thing You don't use uber for the purpose it started with purpose comes later your experience with it Then drives you to purpose. So this is the uber purpose which is actually a very good purpose, huh? Make transportation as reliable as running water Everywhere for everyone That's a damn good purpose That's what I would recommend to you. I would tell you that there's a damn good purpose now Let's look at what consumers get out of this. This is what consumers say about uber commute travel transportation This is exactly what the consumer word cloud is on this thing So there's nothing like, you know, it's easy running water blob which etc Their experience is I've used it. It's convenient. I can call it any point of time. It's fine, etc That's what they're saying like somebody said route with cheaters the trouble is many, you know uber drivers I think are upgraded auto drivers. So they don't have a sense of what customer service is. Let's look at the next example apple So what is apples brand purpose another very good brand purpose? To empower creative exploration and expression This is apples brand purpose as stated by apple So let's see how consumers understand apple brand purpose. What is they take from it? This is what consumers understand from it innovation high quality great brand. That's it As long as apple sticks to that core they will win The day they move away from this right now innovation in the mobile phone business is negative That's why their sales are negative right now They're negative one last quarter trending down So as long as apple continues to be innovative Okay, high quality they will say The day they don't do that they will not say Okay purpose comes after that now. Let's look at Indian Express What's the Indian Express brand purpose here it is the Indian Express brand purpose is journalism of courage journalism of courage Now here's the closest fit actually if you look at what consumers understand look at that information people journalism truth awareness best unbiased Now loyalty clarity viewpoint All the words on that journalism of courage you get a lot more here. So these are three brands Stated brand purposes. This is how consumers understand them next The one place where I'm recognizing I am also part of the textiles business in the other table a group the one place I'm recognizing that purpose has a huge role is the fashion business In the fashion business whether it's Patagonia whether it's gap anybody if you are not caring for society Which is recycling of water? Ensuring that dice are safe and Anxiety ensuring that there's a circular economy to take back clothes, etc. This is absolutely fertile area If a brand is not sustainable you cannot sell to anybody in the Westwood So whether it's a gap with us Polo Ralph Lauren whether it's H&M with that Zara the first thing from a yarn to a fabric to a stitcher Is people are saying be sustainable. Otherwise, we won't touch you This industry is seeing faster purpose than any other industry that I'm tracking right now. This is number one The number of clothes being bought by people I'm sure the women here won't agree But these are facts the number of apparel being bought by people is dropping is Dropping by 40% over the last three years Believe it or not is dropping so people are getting more and more conscious saying I don't want to do this conspicuous consumption and waste resources This industry purpose will become extremely important. It's already important. It's getting even more important watch for this industry and its purpose So if you look at purpose and success because everybody tells you I have purpose and I will succeed I just thought I'll give you a two by two matrix to say Purpose is stated or unstated somebody has stated the purpose or not stated the purpose and The business has succeeded or failed. Let's look at the first box stated purpose Believe it or not. King fish. I had a damn good stated purpose go and look it up Believe it or not. No, I had a damn good purpose the best ever that I worked with connecting people or a lot of technology Businesses have connecting people as purpose Facebook has it. Okay, Twitter has it LinkedIn has it. No, I had it first Motorola Levi's they were the first to do gender equality They were the first to do talk about sustainability, etc. 15 years ago, and then they failed they went private now They've gone public again. Now they're succeeding block and a blockbuster big failure. So all stated purpose The brands finally failed or the business failed Unstated and business failure. I would say jet a ways where they said we just want to upgrade masses of people into this Let's look at stated purpose and business success. Walt Disney Lego Nike Southwest Airlines Netflix remark Very clearly stated and winning Unstated but winning a lot of Indian brands there Gadi Patanjali Nirma Nalli Saris winning big time They don't need consultants. They have a natural. I said entrepreneurs have a natural flair about what purposes and they do it, right? Okay, so this is what I would tell you Here's a company purpose. It was terrible. I won't name the company. It said in 2010. No child left behind. No child hungry by 2020 I talked earlier that a Brand or a company can rarely solve society's problems This is one of those examples. You cannot solve this problem whether you like it or not You can be part of it, but you can't make a definitive in a statement like that Here's a great example and this is what consumers reward you for. This is CVS there are a bunch of pharmacy chains in America and their purpose is Helping people leave lead live healthier lives. That's what their purpose is. They have 2800 stores They did this in 2014. You know what they did they said because we our purpose is helping people live healthier lives We will stop selling cigarettes in all our 2800 stores Cigarette sales cigarette sales at that point of time in their stores were two billion dollars Two billion dollars. They said we'll walk away We will not sell cigarettes in our stores Here's what happened as soon as they said it the day they said it the share price fell The coverage in Wall Street over the next few days was these guys can't make it work. This will fail No chance that this will ever work However, they got new business from people who said hey, that's a good purpose. We now want to work with you Can we put our range of products in your shops? No other chain stops selling cigarettes Here's the interesting part in every district or city where there was a CVS store sales of cigarettes fell 1% Because it went into a wider loop where people said hey, this is right. What these guys are doing is right Their stock price ended up at the end of one year from 64 dollars to 113 dollars So that consumers recognized and rewarded say that's a brave purpose. You're living your purpose So my point is you can say I need healthier lives But when your actions don't match it people say that's not smart, but when your actions match it people reward you At the same time in the same breath I must also tell you in the outlets of CVS nicotine patches went up by 4% Cigarette sales they went to zero Cigarette sales in the district neighborhood dropped by one, but nicotine patch, which is a fix for a Smoker those sales went up This is a very good example of living your purpose and delivering on it. That's what I want to tell you so My last six slides for you number one writing a purpose statement is an easy fad Living it is very very difficult That's what I want you to think about. It's extremely easy for a bunch of people to put 10 words and say this is purpose But it's extremely difficult to live it. It's not easy so that's statutory warning number one number two Every company has purpose Every company in a country has purpose Every brand at a global level and at a country level as purpose One of them has to be bland Correct because all purposes won't match right Because if you say every brand has to have a purpose every company has to have a purpose it won't match Something will give way. So let's look at some of this. Okay to give you an example Unilever purpose across the world is add vitality to life We serve every day needs of nutrition hygiene and personal care. You can't get blander than that That's their purpose stated a brand can have a more important purpose like that which says I want to improve the confidence amongst girls That's more tangible But I will serve everybody everywhere every time. That's too bland. Let's look at Nestle. Their purpose is good food good life We make food tasty and nutritious That's their purpose. Let's look at PepsiCo sustained growth by making More nutritious products and we'll take care of plant Sorry the planet people and products. That's PepsiCo purpose So at a global level, you'll have a purpose at a country level, you'll have a purpose at a brand level You'll have a purpose and trust me one of them or two of them will be very bland Will be least inspiring. That's the challenge with purpose It's easy for one brand a Technology type of a brand like Uber to have the same purpose across the world. It's very easy But for most of the brands, it's a little more difficult than that Purposes is a binary game. Either you do it or you don't there are no shades of they If you say something you commit to something then you have to deliver big time on it You can't say something and not do it. It's a zero one game the moment you don't do it People will catch you out and they'll say hey, this is gone. I don't trust this brand anymore Number four purpose after doing it must finally give you Social value and hence social capital. What are you shooting for? You're shooting for the good word of society, which is what every entrepreneur 200 years ago went for You're shooting for the good word of society and hence if you get your purpose, right? If you deliver on your purpose, then you must get social value and social capital That is what it should lead to Okay, your license to operate in that society is what? You should really shoot for So what's at the heart of great brands hasn't changed over decades? And over decades the heart of a great brand has been great value first Encompassing great quality delivering more than the promise staying clean and ethical caring for society taking care of people and the ecosystem This is what a brand has stood for time immemorial. That's not going to change It will never change Which our way consumers can get it they will go for that. That's the combination which is the holy grail which we shoot for so in summary is The concept of purpose new my submission to you. No It's not new it's old hat Every entrepreneur had this in him and everyone entrepreneur did it over the last 200 300 years Whether it's a Rockefeller's or anyone second do condos consumers understand purpose roughly Can they play back purpose to you like they play back your positioning in advertising? The answer is no They cannot play back your purpose Because in purpose you're shooting for something much grand with in a grand vision and you know serving the world Is purpose the core and does it help growth? My answer is no Brands which are good, which is the definition I gave you of why a brand sells if it does that even if it doesn't have purpose it will grow if It has a purpose then you can classify it as a brand Which has great value and also has purpose and it grows a Brand which does not meet that criteria which I talked about quality Ethical XYZ whatever purposes has it doesn't work Like what happened with Enron like what happened with jet airways in the examples of innovation and women board members And the challenges with purpose as I've mentioned to you is it's a zero one game Either you do it or you don't if you say something and don't do it you get beaten up really badly in a social world So finally why are people talking about purpose now? I believe people are talking about purpose because of the times we live in which is social media In the past the media determined what they said about a company or a brand you had no control Today consumers have control over brands So more and more brands want to talk to more and more consumers hoping that they're able to convince them and appeal to their heart Saying this is what I'm doing if and my final argument if Brands Had purpose and was truly understood then I don't think The government of India or anybody has to enact a CSR law Would have done it anyway think about it Okay, so any which way you look at it Purpose is important, but it's not the guarantee of success That's the point. I want to leave you with okay, so thank you very much. I had a good time talking to all of you