8 Benefits to Being a Socially Responsible Brand

Business leaders act, not react. By nature they are forward-thinking and innovative — a ballast on a ship. But never before has leadership been a more critical tool, with billion-dollar brands being built overnight and distribution trending in ways we never imagined.

It’s the Internet, of course. Consumers are interacting with brands in ways that could never have been done before. 20 years ago, our choices were limited to whatever was on the shelves at our local supermarket or pharmacy. Now, every brand and product is available at anytime and anywhere.
So how do we as leaders distinguish ourselves? The key is to understand how our brands can provide solutions to problems as well as to communities (our own or others). Here are eight reasons that business leaders who incorporate social responsibility into their business models will survive and thrive.

1. Social responsibility is great for business. If the only focus on is the bottom line (and it shouldn’t be), there will be missed opportunities and revenue streams. Over a 15-year period, businesses with a social mission perform 10.5 to 1 over their competitors. This is according to John Mackey’s (co-founder of Whole Foods) book, “Conscious Capitalism.” That would be reason enough for me!
2. What drives consumers to purchase isn’t adverting per se but the belief that their action has a positive reaction. Does this mean that they are willing to pay more? According to Nielsen, yes: on average, 20% more than for a similar brand without a social mission. It’s why we are willing to pay $5 or more for Starbucks when Dunkin’ Donuts offers coffee at a fraction of the price.
3. Here are two more tangible ways that social responsibility drives ROI. The average social business spends 2% of its revenue on advertising. That’s compared to 20% for traditional businesses. I highlight this point in my SmartBlogs article on StorySelling.
4. StorySelling is the idea that because of your purchase, amazing things are possible — and not just for the shareholders. Your purchase is directly linked to a tangible, positive result. Perhaps it’s providing medicine or building schools. My actions cause a positive reaction. Your impact is tangible.
5. According to the Tuck School of Business at Dartmouth University, this also results in 10% to 15% more purchasing from existing customers. As we know, it’s much cheaper to acquire an existing customer than a new customer. Why not make it even more desirable that they work with you?
6. Being the leader that you are, you know every objective is driven by the best talent. You might be surprised to learn that the social mission of your business affects them, too. Say what you will about millennials, but 70% (Deloitte) of them are willing to take less compensation to work for a business that is socially responsible.
7. Here is the kicker: employees are also 87% less likely, according to a Gallup study, to leave the job once they get the job.
8. Lastly, leadership is about setting and achieving goals. How can this be done without a social purpose? Henry Ford believed that everyone had the right to own the road. That an automobile wasn’t meant for only the elite but also for the masses. To prove his point, he paid his employees some of the highest hourly wages per hour so they, too, could afford the dream. Everyone in the organization was focused on the mission.

Whole Foods is another amazing example. Their belief in the quality of what we eat is being ineffectively copied by hundreds of competitors. You can’t match what your organization doesn’t understand. Fundamentally, purpose is instilled in every aspect of what they do — from the sourcing to the display. And, Whole Foods has some of the highest margins in the grocery business.

Finding your purpose is what makes you a leader. Think about your community, your constituents or ask your employees. Inspiration will overwhelm and actions will be met with positive ROI.
Provide your customers with a euphoria that can’t be bought!



Zack Rosenberg is a social entrepreneur and founder of DoGoodBuyUs, the marketplace for Goods that Do Good. After a career in advertising working for companies such as BuzzFeed, WebMD, SmartBrief and others, he turned his attention to transforming the world through business.

Lessons From Pat McGovern for Entrepreneurs

Very sad about the passing of Pat McGovern, the Chairman of International Data Group (IDG). He was my mentor and friend for over 30 years, and a giant in the technology, media, market research, and venture capital fields. 

Today, I took some time to reflect on what Pat taught me as an entrepreneur and investor.

Pat McGovern was a global role model for entrepreneurs, constantly traveling around the world, rewiring his brain with the best ideas from every culture.

Here are a few lessons from my experiences with Pat:

1. Focus on the customer. Listen to them intently and help them to be more successful by serving their needs. (Easy to say, hard to do.)

2. Do not dwell on the past. Focus on the future, what you will do next to make a better product or service.

3. Constantly be learning as much as you can from those around you—from your colleagues, your customers, and everyone you meet everywhere.

4. Constantly be thinking of better ways to do things. The biggest room in the world is the room for improvement.

5. Hire the best, smartest people that you can, empower them to serve customers, and get out of their way.

6. Work in small, decentralized business units as close as possible to the customer.

7. Build and maintain long-term relationships with customers, employees, investors, and friends.

8. Never bad-mouth your competition. Focus instead on your business and what you can do for your customers.

9. Think globally, act locally. Great local managers with local knowledge and experience will always outperform managers shipped in from elsewhere.

10. In every organization and in the world at large, show respect for every individual.


[Editor's note: Steve Woit worked with Pat McGovern, Chairman of IDG, for 17 years, beginning as Assistant to the Chairman in 1980 and finishing as General Partner, IDG Ventures in 1997. He is the Founding Publisher of Xconomy, a business that reflects the IDG model of local news coverage and events in top technology clusters.]

Leaders must meet their future selves

Recently, social psychologists discovered a problem most of us have in preparing for the future: we think of our future selves as strangers — as different people altogether. Valuable insight into this problem is provided in research by two university educators — Hal Hershfield, an assistant professor in the marketing department of New York University’s Stern School of Business, and Kelly McGonigal, a health psychologist and lecturer at Stanford University and author of “The Willpower Instinct.”

In experiments with undergraduates, Hershfield discovered that students who were shown a digitally aged image of themselves allocated twice as much to their retirement accounts as those who didn’t see themselves as they aged. Hershfield says that “looking ahead in time and feeling a sense of connection to one’s future self can impact long-term financial decision-making, converting a consumer into a saver.” People with this “future self-continuity” also accumulate more assets than others, including owning their own homes and having bigger bank accounts.

McGonigal has pointed out that connections can also be made along shorter future-oriented timelines. For instance, she suggests writing a post-dated letter from your future self to your present self about specific achievements and successes in the future.

For leaders, it’s especially important to bridge the present and future. Leaders have to define the future not only for themselves but also for their organizations. Still, with the extraordinary demands and difficulties of each present day, it’s easy to let the urgency of today cause you to squander the opportunities of tomorrow.

Odds are, the success of your organization will depend on how well you figure out the future. Here are five strategies to help crystallize the future into the present moment and draw you closer to your future self.

1. See yourself as the leader you could become. Productivity guru Jason W. Womack, author of “Your Best Just Got Better,” advises that to strengthen and build your professional capabilities, you should set a 15-minute timer and then write, in as much detail as possible, about a future ideal day. Apply Womack’s advice to describing your ideal future. Then ask yourself: What will it take to make this happen?
2. Create your future in the here and now. Peter Drucker, the legendary father of modern management, taught that you can deliberately and systematically build your future into the present moment with your thoughts, actions, ideas, decisions and commitments. His work on taking the best approach to constructing your future is illuminated in my book “Create Your Future the Peter Drucker Way: Developing and Applying a Forward-Focused Mindset.”
3.  Design a better tomorrow for others. Joshua David and Robert Hammond were the driving forces behind the development of the High Line elevated park in New York City. Today, the park is a smashing success, attracting more than 4 million visitors annually and boosting real estate values in the surrounding area. It took 10 years for High Line to become a reality, however, and neither David nor Hammond had experience in urban planning or design. But they did have the vision and dedication to save an elevated rail line in danger of demolition. One way you can design a better tomorrow for others is by mentoring, volunteering, or teaching.
4. Resist going only for quick wins. Though change can be difficult, it’s an inevitable facet of the future. A crucial part of change is how we consider our relationship to time—specifically, whether we look at time from a perspective of lack or abundance. Tom Butler-Bowdon, author of “Never Too Late to Be Great: The Power of Thinking Long,” believes that when you have a long-term view of the future, you’re more ready, willing, and able to build things that will unfold over years and decades, rather than going only for easy, short-term results.
5. Think with a beginner’s mind. Shunryu Suzuki, founder of the San Francisco Zen Center and author of the book “Zen Mind, Beginner’s Mind,” writes: “In the beginner’s mind there are many possibilities, but in the expert’s there are few.” In her work coaching and advising business leaders, Bruna Martinuzzi, founder of Clarion Enterprises and author of “Presenting with Credibility,” challenges clients to adopt the beginner’s mind approach. This isn’t easy for most leaders, she says, but it can pave the way for continuous learning and development.

You may not need a digitally aged image of yourself to take action as a leader today. If you practice these five strategies, you can meet your future self.

Bruce Rosenstein is a leading management writer and speaker. A former researcher and writer for USA Today, he is managing editor of Leader to Leader and author of “Create Your Future the Peter Drucker Way” (McGraw-Hill) and “Living in More Than One World” (Berrett-Koehler). For more information, visit BruceRosenstein.com.

Basecamp’s Strategy Offers a Useful Reminder: Less Is More

Unless you follow tech companies, you might have missed the startling announcement by collaboration and communications software maker 37signals that it has decided to refocus the entire company on a single core product.

“Refocusing” might be an understatement.  37signals has developed a dozen different products and services since its founding in 1999. They will now be a “one product company” focused on Basecamp, its popular project management software.  To emphasize the point, the company is also changing its name to Basecamp.  So instead of following the conventional wisdom about growth through diversification, CEO and founder Jason Fried is doubling down on one successful area and putting all of his resources in one basket.

Basecamp is a small company. Even with more than 15 million users, it still has less than 50 people on its payroll.  So it’s somewhat audacious strategy might not be a model for everyone.  But regardless of your company’s size, there’s a lot to be said for the power of pruning and the importance of maintaining focus.  For many companies, in fact, the strategy of “less is more” has been a powerful driver of success.  For example, one of the secrets to Trader Joe’s profitability (which is one of the highest in its industry) is that they only carry 4,000 stock keeping units (SKU’s) per store vs. the typical 50,000 at other grocery chains.  They also open a limited number of stores each year, trading off rapid growth for insuring the quality of their brand.  Similarly, Apple has maintained the dominance of the iPhone partly by resisting the urge to create multiple product variations with different functions and features, in stark contrast to their competitors.

Keeping a business focused on a limited number of products, customers, or capabilities is not a new idea.  In the 1950’s, Peter Drucker emphasized that business strategy needs to include “purposeful abandonment,” i.e. deciding what not to do. Similarly, Peters and Waterman’s 1982 classic, In Search of Excellence, reported that successful companies were those that could “stick to their knitting” and not get sidetracked.

Despite all of this advice, the kind of radical focus exhibited by 37signals (now Basecamp) is difficult for managers who often act like kids in a candy store. Instead of focusing on doing a few things well, they try to go after too many customer segments, too many adjacencies, and too many new technologies.  Witness the struggles of financial services firms that become too big to control effectively; or large pharmaceutical companies that place bets on so many therapeutic areas that they don’t end up winning in any of them.

It’s a natural human tendency to want to do more.  Most of us have trouble walking away from tempting opportunities, whether it’s at the dinner table, or at work.  So we end up with indigestion at home and overload at work.  That’s why it takes a great deal of discipline, and even courage, to slim down, both physically and strategically.

A case in point is Google’s recent sale of Motorola Mobility to Lenovo.  The original purchase was probably a tempting opportunity that was viewed as too good to miss; but when it became clear that the telecommunications hardware business was not in their sweet spot, Google’s senior executives made the tough decision to sell, despite the financial consequences.  And in the long run, avoiding distraction and dilution of focus will probably be worth the cost.

Most of us of course are not in the position to buy and sell companies or even rationalize our product lines.  As managers however, we can make sure that our teams stay focused on the few critical strategies and projects that will make the most difference.  We also can ask Drucker’s question about what we should stop doing; and we can push back on others when we’re asked to do things that might be distractions from the core mission of our group.  None of this is easy in the midst of day-to-day pressures.  But in the long run, it’s very likely that we’ll reap higher rewards by doing less.