Doing well and doing good aren’t mutually exclusive

Altruism and sustainable profits aren’t always concepts you’ll find in the same sentence, but don’t tell that to Dave Simnick.

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Simnick, founder and CEO of SoapBox Soaps, created the company in 2010 to do precisely that — to help people in need around the world while at the same time building a leading CPG brand, and attaching meaningful purpose to a commoditized category — soap.



“The biggest thing we’ve tried to do at SoapBox is change the emotional meaning of something so commoditized as a bar of soap,” Simnick told attendees of the inaugural Future Leaders Summit, jointly presented by Drug Store News and Mack Elevation Forum.



The crucial first step in creating such a business is to distinguish between “cause marketing” and a “purpose-driven” brand. “Cause marketing is an afterthought; purpose is intentional,” he said. Cause marketing is about taking a product that has already existed and “bolting on” a cause to it because the brand needs a new marketing strategy, whereas purpose is “in the DNA of that company,” he said.



As a best-in-class case study of what NOT to do, Simnick shared the example of a 2011 Kentucky Fried Chicken cause-marketing campaign that got blasted on social medial for trying to entice customers to buy a half-gallon fountain soda to help support the Juvenile Diabetes Research Foundation. “There’s a certain irony in trying to raise money for diabetes by potentially giving your customers Type 2 diabetes,” Simnick quipped. “When we look at authenticity and we look at how are we marketing toward millennials, purpose is essential.”



Millennials aside, consumer interest in purpose-driven companies and brands isn’t just a trend or some passing fad, Simnick noted. According to the 2012 Edelman Goodpurpose survey, 76% of consumers around the world believe it’s right for a company to support an important cause while making a profit at the same time. Fifty-three percent rank the social purpose of a company or brand as the No. 1 reason for making a purchase when all other factors, such as price and quality, are equal. In fact, 44% of consumers around the world would be willing to trade up and pay a premium for a brand associated with a strong purpose.



“The point is purpose matters, and after 10 years of research, the data says ... you will outperform your competitors 12-fold if you have [a strong] purpose,” noted Future Leaders Summit moderator Dan Mack, managing director of Mack Elevation Forum. Purpose does more than activate your consumer base, it galvanizes your employee base, too. “A purpose mobilizes people in a way that pursuing profits never can; ... purpose is bigger; it’s transformative.”



Simnick provided three additional learnings for how to make purposeful marketing work for a brand:

1. Quality matters: Crunching the numbers on a one-for-one, purpose-driven deal — Soap-Box Soaps promises to donate one bar of soap to a community in need for every bar purchased — can be a challenge. But sacrificing quality in an effort to drive more dollars to the bottom line may lead your promotion to bottom out. “The giveback — that purpose — is the cherry on top. That consumer still wants the best thing; that’s the reason they’re buying it,” Simnick said. “The reason she buys us the first time is because of the mission. The reason she continues to buy [us] is because of the efficacy of the product.”

2. Keep the message simple: Another lesson Simnick learned was to keep the offer simple — consumers don’t buy into an offer they can’t understand. “When [consumers are] looking at purpose, cents and percentages don’t make sense to them,” he said. “If someone here told me that they gave 5% of gross to this one charity, that [would be] an amazing financial commitment. The problem is consumers don’t get that. They look at that and think, ‘Where’s the other 95% going?’”

3. Authenticity and transparency seal the deal: Finally, with a smartphone literally at everyone’s fingertips — about 198.9 million consumers in the United States own a smartphone according to the latest comScore figures — verifying the authenticity of a deal has become easier than ever. To prove that SoapBox is delivering on its brand promise, each SoapBox package has a unique tracking code, branded the “Hope Code,” that can pinpoint where in the world the donated bar will be heading. “We have to prove to [the consumer] how they are part of the narrative that we are co-writing,” Simnick explained.