To Make Conscious Capitalism Work for Your Small Business, Use the AID Approach
Being a business in America can be a little like being a kid on a massive playground. You want to stand out, but it’s so crowded, and your voice can get lost in the noise.
More than 30 million businesses operate in the U.S. and, as Jack Trout and Steve Rivkin’s marketing book Differentiate or Die: Survival in Our Era of Killer Competition suggests, the need to differentiate is more critical than ever. But how?
Just like on the playground, the best way to stand out isn’t always just by wearing the coolest clothes or by shouting the loudest; it’s more about who you are and what you do.
Conscious capitalism is one way that businesses can differentiate themselves. Conscious capitalists seek to elevate humanity by combining social responsibility with entrepreneurship to create change in the world. By focusing on creating a positive impact, in addition to generating profits, conscious companies create a win-win environment for everyone: happier people, a healthier planet and heftier profits.
Given that more than 89 percent of all businesses are small businesses with 20 employees or fewer, according to Census Bureau data, most business owners today aren’t beholden to shareholder value. Now more than ever, small-business owners have a significant opportunity to shape the future.
For conscious companies, the term “bottom line” no longer refers to monetary profits alone. Instead, they’ve realized that social responsibility is better for people, better for the planet and better for profits. People, planet and profits represent the new “triple bottom line.”
How conscious capitalism works
Consumers today -- especially younger ones -- are increasingly swayed by social good. They favor brands on a mission and will spend their money where their values lie. Conscious companies tend to treat their stakeholders better. They offer better conditions, better rewards and the opportunity to make a difference -- all of which leads to higher productivity and loyalty.
These conditions mean that conscious companies do better financially and can make a positive impact on the world around them. Research has shown that companies that score higher on factors such as generosity of compensation and investment in their communities actually outperform the S&P 500 index tenfold.
Discovering conscious capitalism has been transformative in my own life. I used to be so blindly focused on achieving financial success that I lost sight of the “why.” So when I ended up in the hospital and suddenly had a lot of time to evaluate my life, I kept coming back to one question: “If my life were over today, did I make a difference?”
The answer that came back to me was a resounding no. I knew I had to change how I was working and find a bigger purpose.
How to start practicing conscious capitalism
Conscious capitalism might sound like a big undertaking, but it doesn’t have to be. You can start by taking three simple approaches, which I’ve summarized with the acronym AID: align, integrate and donate.
If you have a product or service that you can tangibly give away, try aligning your giving in the same way that companies like Toms, Warby Parker or Bombas do. All three companies operate on a one-to-one principle by which they donate a pair of their shoes, glasses or socks to people in need for every purchase a paying customer makes.
Another approach is to integrate your values into your giving. For instance, my client Biotrust Nutrition has focused its giving efforts on ending child hunger. Over the past five years, each time a customer improves his nutrition by purchasing the company’s products, it provides a nutritious meal for a child in need. It has now donated more than 2.6 million meals to underprivileged children.
If you don’t have one special cause that you feel passionate about, you can model your giving after what I call a “carousel of care” by donating monthly to a rotation of charities to ensure that you are always supporting causes that have an urgent need. In the past year, my company has donated to everything from hurricane relief to cancer research and mental health solutions -- all dependent on the causes that were most important and relevant to me, my team and our clients and vendors.
Here are some additional tips to consider if you want to successfully integrate conscious capitalism into your everyday business endeavors:
Don’t be afraid to join the conversation
Never shy away from talking about the difference you are making. When I speak at conferences and Mastermind Talks, I typically focus on digital advertising and will only briefly touch on conscious capitalism. Surprisingly, the topic that consistently resonates the most with audiences is nearly always conscious capitalism. Whether it inspires them to explore conscious capitalism for themselves, or interests them in doing business with my company, it creates goodwill and makes for a great conversation topic. So don’t fool yourself into thinking you need to give a TED Talk on conscious capitalism to have a platform to speak from. If you care about making a difference, you can integrate this into any sort of conversation you might have about your business.
As long as you’re “authentic” in your purpose, it’s a no-brainer to integrate how you are making a difference into your elevator pitch. Consumers today, especially millennials, increasingly favor socially conscious businesses compared with those that have no overarching purpose. So be proud to share how you’re contributing and embrace how it differentiates you from the crowd. Remember, conscious capitalism is transformational not only for society, but also for business.
Curate your impact with social proof
In today’s connected digital world, it’s not enough to simply talk about your giving with your clients, prospects and vendors. Social media has been a driving force behind the rise of conscious capitalism. Stakeholders will want to see the evidence of your impact so that they can verify and, in turn, share it with their own networks. Be sure to curate social proof of your impact into your online media presence.
You can start by simply posting about your contributions, highlighting the work behind the charities you support and even encouraging your social media followers to donate and support their efforts. If you believe in the cause, it’s important to encourage others to believe in it, too.
When you’re on that crowded playground, it’s easy to feel like you don’t matter or that you can’t make a difference. But every act of kindness, no matter how big or small, has the potential to cascade into something far more meaningful than simply standing out. Your contributions not only make an impact, but also lead to deeper friendships, enhanced respect from your peers and even acts of reciprocity. These types of returns, more than money, often provide that “missing link” to greater happiness, success and fulfillment at work -- which is ultimately what we all really want.
The bottom line is that it’s never too early, or too late, to start practicing conscious capitalism. Build something you can be proud of. Stand for something. Make money. Make a difference. Repeat.