Why an Authentic Purpose Is the Best Differentiator Entrepreneurs plan on how they'll execute a business or service, but the real question driving a sustainable brand should be 'Why?'

By Kelly Wenzel

Opinions expressed by Entrepreneur contributors are their own.

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Authenticity within a company means adhering to a central purpose. And that's important because, as I see it, consumers now care more than ever about the "why" in brands they associate with: what they buy, whom they work for, which places they frequent.

In a startup, this "why" can be especially important. Others can always copy how to solve the problem, but no one can copy the "why" that drives your particular company. It's like DNA: so unique to your business that tapping into it creates sustainable differentiation.

Take the outdoor apparel brand Patagonia, for example. A pioneer of sustainability in business, Patagonia has always practiced what it preaches. In March this year, the company announced its collaboration on a $35 million effort to help install solar panels on homes in eight states. And its "buy less" mantra from back a few years ago -- urging customers to keep using what they had rather than hurry to buy Patagonia parkas -- actually increased sales by one-third.

Related: 7 Habits of Remarkably Effective Brands

"Why' over "how'

When companies such as Patagonia tap into their "why" from the beginning, they see a distinct shift in revenue and market traction, over those that don't. Despite this observation, in my experience, too often the answer to "how" precedes the question of "why." And that's unfortunate.

I was recently investigating a new social marketing product, and from reading the company website, wasn't sure what it did. The company claimed its approach was better than that of its competitors, but the message fell flat. It wasn't until I spoke to the two impassioned co-founders that the purpose behind their product was clear -- and it was very compelling. That made all the difference for me.

It also illustrated again for me how the most effective organizations capture their "whys" -- call them visions, missions, raisons d'être -- and communicate them at scale in ways that feel authentic and human. When the purpose precedes the product, great results follow. A purpose-led startup gains a more loyal community of customers.

In a recent study, customers rated authentic characteristics such as honest communication and sustainability as more important than product utility and brand appeal, and 63 percent of consumers said they would prefer to buy products from companies they perceive to be authentic. Consumers are willing to pay more for products made by authentically purposeful brands.

A more engaged workforce

In an environment with a workforce increasingly composed of millennials, defining your purpose can be instrumental in attracting and retaining top talent. A 2016 global Deloitte study showed that millennials want more than a paycheck -- they want a meaningful mission. A company that taps into its purpose and understands what problem it wants to solve will attract these young people, who will not only believe in the same vision but will work hard to ensure it's achieved.

Related: For Startups Recruiting Talent, Money Really Isn't Everything

A better bottom line

A few years ago, I led a rebranding at a company in a crowded market segment that was quickly being commoditized. Our strategy: All our marketing efforts shifted to highlight our mission instead of our products.

And the strategy worked: The pipeline jumped 90 percent, the close rate increased by 3 percent and revenue climbed 50 percent -- all within a quarter that had historically been the weakest of the year for this company. We didn't add a single salesperson, sign a new partner or release a new product. We simply communicated the reasons that drove us to succeed, and people listened.

Digging deep to find your purpose

To ensure you're creating a company that consumers will trust, ask yourself two questions:

1. Why do I want to solve this problem more than others? What drove you to tackle this pain point in the first place? What motivates you to go to work? What would success look like to you?

Wrap-style carrier brand Baby K'tan was born from a singular purpose: President and co-founder Michal Chesal had a concern about her son, who had been born with Down syndrome: She needed a way to carry him that provided sensory nourishment. So, she built her product around her "why," and her company has been wildly successful as a result.

Southwest Airlines' core purpose is displayed right on its website: to "connect people to what's important in their lives through friendly, reliable, low-cost air travel." That purpose (and the constant messaging surrounding it) is why it's one of the most trusted companies in the United States.

2. How does this business help me achieve that purpose? When it comes to purpose, lip service alone will not cut it. Our company's CEO, Shawn Riegsecker, has a quote I love: "A value isn't a value until it costs you money." A plainer version of this would be: Your purpose can't be just words on a page. You have to live your true value and be "all in."

Sustainable household-goods company Seventh Generation is committed to making the world a better place for future generations. It lives out this purpose by asking its community to line-dry all laundry. That's being authentic even to the detriment of its bottom line (the company sells items such as dryer sheets) speaks volumes.

Related: How Sustainability Disclosure Creates Competitive Advantage

Similarly, Hyundai is not afraid to take action on its mission. During the recession, it let its customers return newly purchased vehicles if they lost their jobs. The decision was born from Hyundai's central purpose -- to make people feel safe -- and the adherence to that purpose allowed Hyundai to survive during a time when many companies struggled.

Business is a copycat league. If your business is successful, other companies will be quick to copy your products, your messages and even the ways in which you do things. But no one can copy your "why." If you make your purpose the foundation of your business, the trust of your customers will follow.

Wavy Line
Kelly Wenzel

CMO, Centro

Kelly Wenzel is the CMO of Centro. Centro develops digital advertising and media management software to help advertisers streamline and scale digital campaigns.

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