Stengel, who now runs his own consultancy, spent three years tracking 50,000 companies to find out the secrets to long-term success. Along with Millward Brown, he identified the top 50 companies that are “ideals driven” in his book Grow.
Twenty-one of these top 50 companies are in this year’s BrandZ list. ‘Grow’ brands have increased in value by 87% over five years. This compares to 43% for the other brands included in the top 100 list. According to Stengel, his top 50 brands out perform the market threefold.
Brands as diverse as IBM, Starbucks, MasterCard and Dove (see below) make Stengel’s top 50. But Stengel says, “they all have commonalities”.
“When you go in and strip away differences in language and culture, you find that they ask similar questions. IBM and Innocent, for example, are very different, but the way they think about their ideals has similarities.”
Other companies are starting to notice the success of those businesses that have a purpose beyond profit, he adds. “There’s a growing awareness that this is the right way to do business because it has a really big impact on why people buy things.”
Benoit Garbe, vice-president at Millward Brown, which worked on the Grow research project using a variety of methods including neuroscience, says brands that improve people’s lives will also have a healthier bottom line. “We looked at the brands that have built a deep relationship with consumers and how each of them has grown in the past 10 years. Then we asked, did that relationship turn into stronger financial growth? For the most part what we found was that these companies were ideals driven.
“When brands create these ideals, they create a better relationship with consumers. Your marketing is more meaningful and people buy into what you stand for.”
Marks & Spencer, which is number 10 in the top UK brands, has made a commitment to its Plan A sustainability programme. Marketing director Steve Sharp says the shareholder-owned business needs to demonstrate that it is doing more for the planet.
He says: “Increasingly people are looking behind what companies really stand for and using their spending power to back those they agree with. Companies will have to behave better if they’re going to attract customers because it’s becoming more and more important to people’s buying decisions.”
Despite a difficult economic climate, Sharp believes its customers still want to see a commitment beyond profit from the retailer. He says: “It’s difficult during a recession [but] recessions will come and go so we think it’s particularly important to carry on during difficult times. In difficult times, it seems obvious to be more thrifty and more careful and not so wasteful.”
Millward Brown’s Garbe agrees, and adds that businesses which commit to their ideals will make more money: “Those companies that evaluate what they stand for, what their higher meaning and purpose is, know down the road that they will eventually create a higher profit.”