To many, the term “Champion Brand” may evoke thoughts of company name recognition, top-rated products, memorable packaging and clever marketing strategies or carefully crafted PR campaigns. When we think of brands, we may think about the consistency in a company’s messaging.
But in a recent global study of public and private companies, the Darden School and APCO Worldwide discovered just how much louder actions speak than words. The traditional strategies of branding and marketing are no longer what keep stakeholders engaged and committed to a brand over time. Corporate behavior — an organization’s actions, practices and policies — has far greater impact.
Globally admired brands focus less on products and more on practices: It is how a company acts that will boost its chances of earning the label of Champion Brand. These companies walk their talk.
While this may sound simple, it has become harder to do. In recent years, the business climate has dramatically changed. Global companies speak to broader and more diverse audiences. The complex global landscape — a world which now includes a 24-7, back-and-forth dialogue with savvy and well-informed customers, employees and community members — is changing how leading companies act and communicate.
To learn about the impact of these trends on business leaders, Darden and APCO conducted an in-depth study throughout 14 global markets. Of the 36,551 respondents who were surveyed, over 7,800 of the more engaged stakeholders were further sampled. In the second part of the survey, those individuals also answered questions about nearly 500 private and public companies around the world.
From this data, 10 key insights emerged that every business leader should know. These insights fall into two main categories: the changing role of business in society and the evolving audience landscape.
People acknowledge the growing impact and potential of business to play a greater role in society.
- How a company operates in society is just as important as its products and services.
Many may be surprised to learn that 68 percent of the survey’s respondents said that when evaluating companies, it is as important for them to know how the organization operates as it is to know what it sells. This suggests that businesses should rank their corporate practices as equally important as their products, if they want to convert their stakeholders from active onlookers to raving fans.
- Companies have a bigger impact on society today than 10 years ago.
It has long been known that a company’s products and services can greatly impact individual lives (think life-saving prescriptions and exercise equipment, for example), but now, people believe that businesses can influence broader, social issues such as the environment and human rights through their policies and actions (think “green” packaging and corporate policies that prohibit the use of child labor). In fact, 77 percent of those surveyed agree that global corporations have a bigger impact on people’s lives today than they did just 10 years ago.
- The standards for good corporate conduct are rising.
Seventy-three percent believe that people scrutinize what companies do more today than they did 10 years ago. Stakeholders are watching, and responding, based on corporate conduct: 74 percent have also taken some form of action, including boycotting a company’s products, contacting a government official or spreading the word about an organization, based on its corporate behavior.
- Engaging in social issues is an opportunity to build stronger relationships with stakeholders.
An overwhelming majority of those interviewed, 94 percent, said that companies have the ability to shape a better society. That’s great news for business. But corporations would be wise to remember the old adage that with great power comes great responsibility: Stakeholders want their companies to exceed the “do no harm” rule (à la not decimating forests or contributing to pollution or disease), and actively champion social issues that they care about.
- Business is increasingly involved in social issues.
The Champion Brand survey data showed that business can be an important conduit to social change, and people now expect corporations to answer the call. With 60 percent of respondents agreeing that companies now serve some functions in society that were previously reserved only for the government, business is no longer viewed as a passive bystander to social change, but as an important player that has a responsibility to help make it happen.
The audience is changing: More stakeholders are engaged across multiple interests and channels.
- There is a core group of engaged stakeholders who are looking at companies from a 360-degree perspective.
In studying the survey respondents more closely, we discovered a rather unexpected phenomenon: the emergence of the “stakebroker.” According to Dr. Karen Buerkle, managing director of APCO Insight, the opinion research consultancy of APCO Worldwide, “Stakebrokers are not your traditional opinion leaders or influencers who read the news and talk to people about their opinions; they are a highly engaged group that looks at companies from a 360-degree perspective. What makes this audience unique is not just that they are more informed and active, but that they engage with companies from the perspective of ALL of the traditional audiences and their respective interests simultaneously (consumers, community members, environmentalists, policy influencers, employees and investors).”
- Stakebrokers’ interactions with companies are much more sensitive to issues than the general public.
Business leaders may want to heed another key insight revealed in the Champion Brand study: 73 percent of the stakebrokers surveyed did not buy a product specifically because they didn’t agree with the company’s practices, compared to 35 percent of the general population. Although stakebrokers represent a smaller percentage of consumers, their activism across multiple channels and their power as influencers make them a formidable force in the global market.
- Stakebroker activism is highest in “emerging” economies.
From this worldwide study across 14 global economies, we had the ability to make observations not only about people’s behaviors and actions, but also how those behaviors and actions may have differed across different countries. Interestingly, the number of stakebrokers who took some sort of action toward a company were highest in India (90 percent), China (87 percent), and Brazil (82 percent). The data indicates that there is a higher proportion of stakebrokers in these emerging economies than in more developed markets.
- Stakebrokers want to be a part of something bigger.
What else does it take to become a globally admired brand among stakebrokers? Sixty-two percent agree that the best companies are those that advocate for things that matter to them. As Brad Staples, CEO of APCO Worldwide, observed, “Today’s companies are realizing that successful, great brands must go beyond building trust with their stakeholders and actively champion for their stakeholders interests. Only if they do this, will those stakeholders champion these brands. Once companies ingrain this into their DNA, they can grow to earn their place as true leaders in their industries and society.”
- Stakebrokers are younger and on the rise.
To maximize the full potential of Champion Brand strategy, think young and think global. APCO’s survey data showed that stakebrokers are more likely to be younger (Generation X and Y). Add to that the demographic changes underway in emerging economies and it’s not hard to see that the trend of engaged stakebrokers is going to get stronger in the coming years. Specifically, the recently-released United Nations Population Fund’s (UNFPA) State of the World’s Population Report revealed that India has the world’s largest youth population, with 356 million 10–24 year-olds, followed by China (269 million), Indonesia (67 million), the U.S. (65 million), Pakistan (59 million), Nigeria (57 million), Brazil (51 million) and Bangladesh (48 million).
It’s the new era of the Champion Brand.
In the end, the Champion Brand survey unveiled evidence that the expectations for and scrutiny of global brands are increasing rapidly. To become a “champion,” companies will need to think about practices as well as products and actively engage with all stakeholders — young and old, and around the globe.
From all indications, the era of the stakebroker appears to be here to stay. And it will be the companies that demonstrate meaningful commitments to engaging with and improving society that will be able to stay in the game with them for the long haul.
Professor Parmar teaches in the Executive Education program True Leadership: Leading With Meaning, which delves into contemporary research in authentic, personality-driven leadership to help participants tap into their values, move beyond reactive forms of leadership and reignite a sense of purpose.