Brand Prism

Brands that have been most successful in navigating 2020 are those that have proactively committed to taking concrete actions and reporting on their progress with humility, candor, and transparency. Because consumers don’t just want to hear brands’ words today—they want to see their actions. Keeping a more watchful eye than ever, consumers today are keen to follow the journey—celebrating those who lead by example and calling out those whose words ring hollow.

Consumers have a clear bias toward action in 2020. While taking a public stance on an issue or making statements about overarching brand purpose may seem like appropriate responses, they fall short under the savvy and watchful eyes of consumers who want to see measurable commitments. When asked what would indicate that a brand has strong values, consumers favor tangible actions and commitments over statements. Four of the top five answers highlight demonstrable impact or making concrete investments in improving how the brand acts in line with its values.

This isn’t easy. Reputations don’t change overnight.

Our assessment of Fortune 500 brands rated the degree to which they were able to be proactive in their commitments—anticipating the issues that are important to internal and external stakeholders and formulating a track record of action that earns them the right to be vocal. Of all the variables we assessed, this was on average the lowest score, and brands across all industries struggle nearly equally. And this lack of a proactive track record makes it harder to know what to say when issues arise.

“There’s one of two things you can do [when issues arise]—act quickly and have less substance, or take a little longer and have a more well-thought-out structure and resources behind it,” says a brand expert interviewed for this research. “Would you like to do it instantaneously? Yes—but that’s not how the world works. You have to balance the desire for speed with thoroughness and being respectful of the true obligation.”

This say-do gap is critical

Brands must confront the reality that consumers are keeping up on their reporting now more than ever. So, if you commit to it, you must be ready to report on it—and report on it in ways that consumers can easily access and understand. 60 percent of consumers report that they are seeking out information on a brand’s values more frequently now than they were six months ago. Not surprisingly, the youngest generations are even more enthusiastic about tracking brand reporting.

You can’t just “check the box” when all eyes are on your efforts

It’s common for brands to develop and share annual reporting around their various social, environmental, and diversity commitments with the understanding that these have largely been mandatory exercises in box-checking aimed at industry, peer, and regulatory audiences. However, consumers report that they, too, are following these reports right now—especially reporting committed to diversity, equity, and inclusion. Nearly six in 10 consumers report seeking DEI reports either frequently or sometimes.

But just because consumers are seeking these reports out, it doesn’t mean they are getting the information they need. When asked to describe brand reporting, only a third of consumers feel that it’s honest, and just over a quarter feel that it’s transparent right now. And our own assessment of brands confirmed this. Making reporting candid was among the top challenges for brands we assessed, with many industries—including financial data services, food consumer brands, and retails brands—struggling to be honest and real about their progress.

For inspiration on how to do this well, brands can look for guidance from Gen Z. When asked how brands should demonstrate their values in their content and stories, the number one answer from Gen Z is to focus on where the brand still needs to make progress in living up to its values. Gen Z wants to see forward-looking reporting that focuses on the journey, rather than backward-looking, self-congratulatory reporting focused solely on achievements. And brands that do this well—like Target, Google, and Ben & Jerry’s—are among those recognized by consumers as having strong values.

Brands that are candid and consistent in reporting are among those recognized by consumers as having strong values.

Top 10 brands, as identified by consumers:

Consumers today expect a brand’s values to show up not only in their interactions with customers, but increasingly in the products they develop and market. More than six in 10 consumers report that it’s most important right now for a brand to demonstrate its values in its products and services. And among Gen Z and Millennial consumers, this is the number one place for brands to demonstrate their values.

According to consumers, a brand’s values can influence its products and services in a number of ways. Chief among these are creating products that benefit society and the environment directly, or that contribute to consumers living healthier lives.

“If [a pharmaceutical company] doesn’t care about the values behind its products, it’s something that consumers should care about [because it will affect our health and well-being],” says a brand expert. “Values are important insofar as they have an impact on the products.”

Younger consumers are more likely to also want to see a brand’s commitment to values extend to how its products are sourced and marketed. More than a third of Gen Z and Millennial consumers ranked “changing the types of partners or suppliers they work with” among the top three ways that brands can demonstrate their values in their products and services. And Gen Z consumers, in particular, want to see products marketed through the use of more diverse voices and special editions of products that align with issues they care about. Nearly 40 percent of Gen Z respondents ranked these among the top three ways that brands can demonstrate their values through their products.

Consumers value quality most of all.

Fundamentally—and perhaps moreso than a product’s impact on society, the environment, or personal health, or how it’s marketed—consumers still strongly equate product quality with a brand’s values today. In fact, “quality” is far and away the core value that consumers believe brands should most embody. 60 percent of consumers ranked this among the top three values that are most important for brands to have, and this was consistent across consumers of all ages.

Brands that can consistently demonstrate quality in their products and services are at a huge advantage with consumers right now. This is also the factor that most influences consumers’ overall opinions of a brand—especially older consumers.

YOUR PRODUCTS ARE YOUR FOUNDATION.

The good news for brands: it all starts with what you do best—your products. If you get it right in your products, you’re more likely to succeed at infusing your values across the other parts of your brand experience as well, according to our research. Our assessment of brands rated the degree to which values are infused across products and services, internal culture, physical and digital touchpoints with consumers, and content and stories. On average, Product was the highest-rated category across all brands and scores dropped off from there. In fact, for two-thirds of the brands we rated, Product was the highest individual rating. This reinforces that if your brand’s products don’t align with your values, it’s much harder to successfully infuse them into the other aspects of your brand and touchpoints with consumers.

This seems to be more intuitive for brands in certain industries right now. Some industries in our analysis—including household products, tech brands, and consulting firms—are able to more seamlessly wed their values to their products, while others—including commercial banks, retail, and food consumer products—struggle to fully connect their products to their values. Consumers recognize this. Among the top ten brands named by consumers as having strong values, a handful of tech brands—including Amazon, Apple, Microsoft, and Google—stand out for their ability to infuse their values into their products, first and foremost.

“Who you are as a brand and the values you espouse must manifest in your products. If they’re not aligned, you’re not going to produce products that are consistent or guided in any sort of meaningful way,” says a brand expert. “It makes certain tradeoffs tough, but if you have divergent product and core values strategies, it’s hard to be successful.”

Brands that think product-first are among those recognized by consumers as having strong values.

Top 10 brands, as identified by consumers:

Most brands fundamentally share versions of the same values—innovation, integrity, trust, etc.—and have arrived at these single-word values through carefully constructed exercises and consultant-built narratives. However, this is where far too many brands stop. They don’t take the time to define what these words truly mean in the context of their brand—and their brand alone. At best, this results in a brand’s values being relegated to job descriptions and hollow “we care” statements. At worst, values fall completely by the wayside. But when done right, a brand can more successfully and consistently apply these values across the entirety of its experience.

YOUR VALUES CAN’T BE VAGUE.

It comes as no surprise that, at their very core, most brands want to stand for very similar values. What brand wouldn’t want to be innovative today? Or to have integrity? In fact, our analysis of brands reveals the extent to which they have overlapping values. In addition to innovation and integrity, more than one in three of the brands we assessed also articulated inclusiveness, respect, and trust as core values.

This isn’t in itself a bad thing. However, the risk of defining values as single words or phrases is that without taking the time to make them feel specific and distinct, internal or external stakeholders will not know what to make of them or how to apply them.

We observed the challenge that this poses for brands in our assessment. When it comes to articulating values, making them feel distinct is the number one challenge for brands, especially consumer packaged goods, software, and consulting.

“Most [brands] have a lot of vagueness within their values,” says a brand expert. “There’s not a lot of specificity. Values can be understood and pursued with subjectivity, which leads to them falling by the wayside. There are different definitions—no way to observe it without specificity.”

“I’m not sure that every brand is clear about what their values are, or has taken the time to articulate and be strategic and thorough about how the values penetrate every part of their organization,” says a brand expert. “And if you’re not clear about who you are and what you stand for, it is very easy to make decisions or do things that would not track back to what those values are.”

Our research shows a strong link between being able to articulate values with specificity, and being able to more easily and consistently apply these values across all parts of the brand experience. We rated brands across two dimensions: the specificity of their values, which considers the degree to which they have defined them beyond single words and made them feel unique to the brand; and the extensibility of their values, or the degree to which they have consistently applied them across products and services, internal culture, touchpoints, and content. The result is a set of four brand archetypes: Niche, Integrated, Nascent, and Diffuse.

The good news: of the brands we rated, nearly half (45 percent) fall into the Integrated archetype, meaning they have relatively specific values and are consistent in their application. The second most common archetype is Diffuse, at about a quarter of brands rated (24 percent). Worth nothing is that Diffuse brands, while consistent in their application, generally scored the lowest across each facet of their brand experience. On average, brands in this category scored just 1.7 out of 4.0, compared with 3.2 out of 4.0 for Integrated brands. This reinforces that the more specific your brand’s values, the more you’ll be able to be consistently excellent in their application. Lending even more credence to the importance of specificity is the fact that half of the top 10 brands named by consumers in our survey reside in the upper two quadrants, while only two reside in the bottom.

Of the brands with more concentrated application of their values, these are nearly evenly split among two archetypes: Niche, at 14 percent of those we rated, and Nascent, at 17 percent. Within both of these archetypes, brands generally focused the application of their values on their products. Niche brands stand a good chance of becoming Integrated by merely focusing more on how their values come to life in their content and touchpoints with consumers. Nascent brands, on the other hand, appear to be earlier in their values journeys and therefore must also work at defining their values with greater specificity.
The bottom line for brands is this: words alone won’t ensure that your values truly come to life for internal or external audiences. They must be operationalized at every level of the brand.

“[Values have] to come to life in behaviors,” says a brand expert. “So it has to be activated. It has to affect daily work. It has to be in companies’ processes, it has to be in people’s work plans. It has to be in performance reviews.”

Brands that define their values with specificity and infuse them consistently are recognized by consumers as having strong values.

Top 10 brands, as identified by consumers:

If 2020 has taught us anything, it’s this: the stakeholders most likely to experience—and draw attention to—any gaps between what your brand says its values are and how you act are your brand’s employees. Employees are now the most trusted public source of information on a brand’s values, and consumers are strongly attuned to what they say and how they’re treated.

Since March 2020 and throughout the resurgence of the Black Lives Matter movement, there have been many high-profile examples of brands that have been called out for inconsistencies in how they tout their values publicly and how they treat their employees internally. Employees themselves have taken to social media and other channels to share their perspectives—and consumers are listening.

“Employees are the best advocates and ambassadors for the brand, and can also be the worst. If they’re happy they’ll tell everybody, if they’re not happy they’ll tell everybody,” says a brand expert. “It’s the responsibility of the organization to fuel what they can tell.”

THEY CAN BECOME YOUR CHAMPIONS OR YOUR WHISTLEBLOWERS.

Our research shows that while consumers may go directly to a brand first to learn about their values, when it comes to the sources they actually trust, they look to a brand’s employees. Nearly five in 10 consumers report that a brand’s employees are their most trusted sources of information on a brand’s values, outpacing other sources including brands’ websites and social media, and articles in the media.

And consumers today also expect brands to enable their employees to share the story of their values. Of the ways in which brands demonstrate their values through their many touchpoints with consumers, equipping employees to talk about them with consumers was ranked number one by more than one in five consumers. Among Millennial consumers in particular, employees are a powerful vehicle for connecting with a brand’s values.

Not surprisingly, consumers are on high alert right now for examples of how employees are being treated. They report judging the degree to which brands have infused their values into their culture by the benefits and support brands offer employees as well as how they invest in diversity and inclusion. Again, it’s more about the actual actions brands are taking here than it is about the statements they’re making. In the minds of consumers, a brand saying it takes care of its employees is much different than actually taking care of them.

Perhaps no industry has been more visible in taking steps to ensure safety and support for its employees during the pandemic than retail, and this in part explains why nearly a third of the top ten brands named by consumers as having strong values right now are retail brands. Consumers offer explanations that shed light on their rationale for recognizing these brands, many of which focus on fair wages, treatment of employees, commitment to diversity and inclusion—clearly all top-of-mind actions for consumers right now.

For brands, this is a tremendous opportunity to rethink how they engage with their employees and their consumers simultaneously, and how to use the former to more intentionally engage the latter.

“Your employees also are your consumers. They’re not necessarily two separate groups,” says a brand expert. “Everything is public, anything you do will go public, you’re putting yourself out there—the public will engage the same way your employees would.”

Brands that publicly prioritize treatment of employees right now are recognized by consumers as having strong values. Top 10 brands, as identified by consumers:

Our research shows that while consumers may go directly to a brand first to learn about their values, when it comes to the sources they actually trust, they look to a brand’s employees. Nearly five in 10 consumers report that a brand’s employees are their most trusted sources of information on a brand’s values, outpacing other sources including brands’ websites and social media, and articles in the media.

THIS AWAKENING IS AN OPPORTUNITY.

There’s proof of a tremendous upside for values-driven brands, which is only increasing with the events of 2020. Our research confirms that purchase intent is strongly tied to feelings of alignment with a brand’s values, and this has increased over the past six months.

“[Gen Z is] so woke and smart when it comes to brands and what they’re doing,” says a brand expert. “They are the next generation of customers who are shopping with and putting their money with and doing business with companies who are doing the right things.”

But it’s not just Gen Z—the overwhelming majority of consumers consider a brand’s values either a lot or some when deciding whether to purchase its products or services. And, nearly three-quarters of consumers report that it’s more important to them now than it was six months ago.

Our Readers Agree

Our proprietary research among readers of The Atlantic is also consistent with the idea that values alignment and purchase intent go hand-in-hand. Among respondents in an Atlantic reader poll, 56 percent said they wouldn’t consider purchasing from a brand if its values didn’t align with their own.

Consumers reward brands with strong values in more ways than just purchasing products from them. They also confer greater trust, desire to work there, and higher expectations of profitability. Ultimately, the mandate is clear for brands. There is a strong throughline between articulating values, applying them with consistency across the brand experience, demonstrating accountability to these values—and being recognized and rewarded by stakeholders. “I’ve seen organizations stepping up in a way that has impressed me,” says a brand expert. “It’s forced us to take more declarative action around values and commit more capital and resources that are uncomfortable even if we weren’t in lean times.”