Customers care more about the values of the companies they buy than ever before. It’s more than your purpose. It’s more than what you sell. They want to know what kind of company you are and what do you care about. Does a company want to do more than drive profits? That’s why I interviewed Dr. Philip Kotler, who is known as the “father of modern marketing.”  He is the S.C. Johnson & Son Distinguished Professor of International Marketing at the Kellogg School of Management at Northwestern University and co-author of Brand Activism: From Purpose to Action. In this interview, you will hear Dr. Kotler describe brand activism, the importance of focusing on a purpose as a company, and the problems encountered when companies do not use brand activism correctly. To start, what is brand activism? Dr. Kotler: Brand activism is a movement toward making a brand do more than just tout the virtues of a product or a service, its usual function, and to go and even identify some value or values that the company has and cares about. For example, The Body Shop, when it started under Anita Roddick, she made it her point that she’s not only selling skincare products as a retailer, but she really was also fighting for animal rights, civil rights, fair trade, environmental protection. So, her brand was active. I don’t mean that all other brands are passive because they do a lot of work, but the implication is that companies carry reputations, and they want to carry a good reputation. More and more consumers would like to know what kind of company this is, what does it care about. Our society is saddled with many problems, and does the company care about any of these problems, or does it just think it’s supposed to make money? An increasing number of companies would like an identity that goes beyond just making the product or service. And that is what we are calling brand activism, the brand that connects with some cause or causes. A Lack of Trust in Society  Brian:  That’s a helpful distinction. You recently wrote a book on this topic. I’d love to know the story behind why you wrote the book Brand Activism and why now? Dr. Kotler: I think that, if you look at some barometers, like the Edelman trust barometer, about the level of trust in society today, it’s undoubtedly been falling. Brian: Yes. Dr. Kotler: And as a result, many companies are not going to be trusted either, as part of maybe government not being believed, and other institutions. And companies ought to be the first to fight against bad companies rather than stand near them or be part of them. So, the idea is that, at this time, companies want to be profiled in a certain way. In other words, the reputation a company has could be just whatever happens in its course of actions. Or it could also be something that could be designed better. Consciously better. What are the different branding stages of development? Dr. Kotler: And you see, the whole idea of a brand itself has gone through several stages, and that’s very important. I think brand activism is probably the highest stage, but let me tell you what the stages are in my mind. Brian: That would be great. Evolution of brands from marketing-driven to values-driven Dr. Kotler: Yes. The first stage is when the company simply does its best to feature its product and services. Now that’s normal. The brand name was an identifier. Then brands moved into trying to define the company’s positioning, but not social positioning. Just their positioning: Walmart is the lowest price, Disney is family entertainment, DuPont is the highest quality, and Toyota is long-lasting, reliable performance. So, in that second stage, the brand became—not just one mentioning a product, but positioning the product. Then the brand moved further to define a set of qualities about the company. For example, John Deere makes all kinds of equipment for farmers and forestry workers, and construction workers. At this stage, John Deere would describe its quality, its integrity, and its innovation. It’s really positioning, but it’s multi-positioning. Namely saying that it stands high on many traits that most people value. But this could move into a fourth stage where the brand adopts a very specific cause. You know about customer social responsibility, and a lot of companies are into that. So, a company may say that it really cares about the climate problem and wants to help move solutions toward keeping a safe climate in the world. Or it could be some other cause. Then brand activism is alive with that development of going from customer social responsibility to the company, saying, “here’s one of the things we’re going to move forward on, to the extent that we can afford to do it. We want to make more useful products, make money doing that, but we also want to push forth some cause that would help all of us.” So that’s the evolution of branding, and brand activism is at one of its latest stages. How have customers changed their expectations? Brian: It’s interesting, as I’m listening to you, as you talked about just the drivers that have been… Some of them have been consumer expectations. The trust that we have towards institutions has fallen, but what has really been driving brand activism, and how have you seen, or from what your research has shown, have customers changed their expectations? Dr. Kotler: I think customers were asked how they feel about the economy and society. We would hear them talk about concerns and fears related to immigration, a decline in ethics, the problem of gun control, a very high federal budget, very high debt, and education failure. Some people, either they never got a good education to everyone—or the college education, whatever it was worth, saddled them with a lot of debt. So, there are all these social issues, and they become the ground out of which brand activism becomes essential. We would say that companies do not have the right to be silent about these issues. An increasing number of people would argue that companies owe it to their consumers to show that they care for more than just their product and making money. And that’s the groundwork that inspired brand activism. And what about B2B companies? Brian: As I listen to you, it sounds like all these things that externally happened in the world around us, which affects our daily life, influence brands to pick up some of the slack in terms of being able to connect with customers. Do you see a difference between B2B companies and B2C companies with brand activism? Dr. Kotler: No, I don’t see a difference. I think both companies will want their reputation to go beyond just making their product as good as possible. If you take equipment companies like John Deere, you take consumer companies like McDonald’s or Coca-Cola. If you start doing a count of the companies that have made their brand more active, there’d be many B2B and a lot of B2C companies in that list of brand active companies. Brian: I was just trying to think, some of the brands that come to mind for me would be like Nike, or Patagonia, Ben & Jerry’s, Starbucks, are pretty acknowledged, and I know that you’ve highlighted them in terms of consumer brands. Do you have any names of like B2B examples that people could look to? And it could just be for me. I was thinking perhaps Salesforce.com or Apple. Anyone else? Dr. Kotler: Yeah. By the way, I’m glad you did mention Salesforce.com because its leader is one of the pioneers in this area is Marc Benioff. And as CEO, he says that he wishes he and other companies pay a higher tax because that’s the only way to address these growing problems. He is distraught with homelessness in San Francisco, where he’s located. And affordable housing, which is missing. He personally told other companies in San Francisco to pool their money in a fund that could be used to double the budget for fighting homelessness in San Francisco. So that kind of thing comes from a company which is a B2B company. I would think that B2B companies have been generally slower as marketers. Most of what we know about modern marketing, aside from sales training and thinking, came from the consumer side. It’s not just a sales thing Dr. Kotler: It was P&G and Unilever that created a difference between sales and the concept of marketing. A company might say, “I do marketing because I have a salesforce, and I advertise.” That’s not marketing. That’s just having two resources that could be used within the marketing framework, but it will not be equivalent to creating a sound and effective total strategy that will keep a firm alive and well for years and years to come. So marketing is more than just sales. Now, that concept of marketing came to the B2B world later than it came to the B2C world. But then B2B discovered marketing and is doing more with it now, and I think they will do more with brand activism. Remember, B2B companies are very close to their customers. Consumer companies don’t even know that much about individual customers. They can learn a lot now, more and more than ever, but B2B companies know through the salesforce every buyer and what they are like. And maybe they don’t think their values have to be done through brand activism. Pretty much, any business buying from another business knows a lot about the values of the seller. That’s why they’re buying from that seller. Brian: Right. Dr. Kotler: There’s less need for the B2B companies to get into brand activism because it’s happening anyway. It’s not just a marketing thing, either Brian: Brand activism, though, it’s not a marketing thing, right. In terms of, it goes deeper into the business strategy and purpose. Do I understand that? Dr. Kotler: Absolutely. No marketing CMO, chief marketing officer, will take the brand that he is responsible for protecting and enhancing and suddenly move into brand activism on his own or her own. That is a decision that is corporate level. No one plays around with choosing an issue like gun control or the environment or our overcrowded prisons and just does it through the marketing department. This is part of designing and protecting the firm’s reputation and meaning. We often see the word “purpose” coming up now in the literature. What is your purpose as a company? “Well, I make cars.” That’s fine, but fundamentally, what are you contributing? How are you justifying your company in terms of making life better in society? Brand activism works best when inspired by leaders Dr. Kotler: Brand activism must come down from the top. It should be in the discussions on several levels of the company. One of the benefits of being brand active is that your employees may be turned on more to the company and its contributions. They tend to be very proud of their company because it cares about more than just making widgets. So that’s probably a motivation for the CEO and the executive suite people to say we really want to get into choosing our values carefully, and putting them into our brand framework, because it will help not only those customers we now have, but to attract more customers, and also to excite our own employees about our purpose. If it’s not just a marketing thing, what can marketers do? Brian:  I get that marketers can’t do this on their own. It really needs to be top-down from the CEO, the board, looking at the whole executive team, so what can marketers do? Are there things they can do to support brand activism? Dr. Kotler: Well, if the impulse is going to come from the CMO, chief marketing officer, here’s what can be done… Let’s say you’re in a company that is not doing brand activism. There’s no display of their values or the issues they care about. One could ask (the CMO or the marketing department), “wouldn’t it help if we start worrying about the future of water and whether there’ll be enough to make our Coca-Cola?” The water problem will be a massive issue in the future. Maybe they should bring that to the executive suite. Putting into their brand work some mention of doing what can conserve water and protect good water. So, it is stimulated initially by someone in marketing that sees that it would be an excellent move to refresh the brand. The CMO’s role in the process You know, every brand gets tired over time. One of the critical requirements of the CMO is to be able to kick that old view of the brand and put in some fresh insight and meaning. So, the brand manager who begins to care a lot doesn’t have to be quiet about it and may successfully get the company at the top level to endorse this thing. The CMO can research any issues that might arise or embarrass the company by taking that cause. If there’s any level of real risk, brand activism probably won’t be adopted. So, I really believe that brand activism is something to be brought to the attention of the company’s senior management by the CMO, or another way, to consider taking some action on that. Framework for Brand Activism Brian: As I’m listening to you, I hear the idea that marketers really need to start with a plan, and as I understand, you put together a framework so that people can put brand activism into their organization. Can you just describe the framework you put together for brand activism? Dr. Kotler: The first need was to describe the different types of brand activism chosen by a company. Categories of Brand Activism source: https://www.marketingjournal.org/finally-brand-activism-philip-kotler-and-christian-sarkar/ The models that we distinguish are, first, it could be social activism. That would mean taking a stand on gender, LGBT, race problems, aging problems, education, or healthcare. That would be to identify your company as being concerned about social issues. The second would be workplace activism. Instead, the company might want to address issues of corporate organization, CEO pay, worker compensation, or labor and union relations. So, the brand may really be addressing workplace issues. The third possibility is that the brand addresses political issues, so we call that political activism complaining about lobbying, voter rights, or gerrymandering. Or the fourth form might be environmental activism, where there’s concern about air and water pollution, emissions, and conservation. The fifth would be economic activism, where the company takes a stand on wage and tax policies that impact income inequality and the redistribution of wealth. Finally, you may go toward legal activism and discuss policies that impact corporations, such as tax policies, citizenship policies, or employment laws. So that’s the framework, and we provide a system of maps and canvases and scoring systems that could help a company that gets serious about adopting brand activism. By a scoring system, it would be a system to see how the company is viewed before it went into brand activism, what it is expected to accomplish in the minds of its customers and the public about being active in that set of issues, and what it is is their score. Brand Activism Scorecard to measure the extent of the firm’s commitment How impactful has been their adoption of that issue. And on what? On sales growth, on profit levels, market shares, etc.? So, we do need some scoring system to know if we should increase our brand activism on that issue, or just stay where we are, or if it’s not working for us at all. Being authentic and genuine  Brian: The thing that I’m hearing is that we need to decide our purpose or reason for being beyond money. That’s part of the purpose, the overarching goal, and from there, then the framework helps me show where I am at today and how I can improve. How do you see empathy fitting into this for the customer? From a customer standpoint, for example. I’ve heard some critique for women’s issues, and companies “pink it up.” Meaning they put pink on things for women’s issues, but it’s not authentic, and we’ve seen some other brands do that. Do you have some thoughts on this? Dr. Kotler: This can get lost in what we might call very superficial talk by the company. That there’s no real commitment. We would say to the company; you’re active about being against pollution; what have you done with that position? If the only thing you’ve done is talk against pollution, but no action, then we’re not as impressed with that. There’s a term you may remember, green grassing. It’s about appearing to be a green company, but just through talk and not doing much about it. I believe there should be researching customers and figuring out what their questions would be; For example, “do you know whether company X cares about some social issue” and if you find out that hardly any customer of yours noticed that you took a stand on that issue, then it’s not working. Probably because you’re just talking it up and not committing—so, we need scoring. When it works well, we believe it enhances the firm’s value in the minds of existing customers and the employees and potential customers. It may even be an entry point that discussing pollution opens your company to many people who don’t know much about your company, but they know a lot about pollution. They’re happy to see another ally in the fight against pollution. The word empathy suggests that will customers really be empathetic with the company, feeling that the company is sincere and caring genuinely about that issue, or will they not believe it’s authentic? Additional Resources: The Case for Brand Activism – A Discussion with Philip Kotler and Christian Sarkar Purpose matters to marketing Get the book: Brand Activism: From Purpose to Action