PURPOSE, INC.

Participants:

Michael Young

Melissa Anderson, Co-Founder and President of Public Good Software

Michael Young:

Welcome to the Purpose, Inc., the podcast where we discuss corporate purpose and stakeholder capitalism. I'm your host, Michael Young.

A lot has changed in a few short months in 2020. First, COVID, George Floyd, Black Lives Matter. We've seen a tremendous amount of brand response to all of this social change, some of it good and positive, some of it frankly off-key. And I've wanted to address the consumer brand media social action dynamic for a while and I'm excited to welcome Melissa Anderson to the podcast. Melissa is the co-founder and president of Public Good Software and Public Good Social Impact Platform has become the leader in making news actionable, working with leading publishers including CNN, Tribune Media, HuffPost, Vice and brands such as Microsoft, Unilever and Danone. And Public Good sits at the intersection between brands, media and social activism and it has the ability to make news actionable. So, to put it in an example, you're reading a story about Black Lives Matter and through Public Good’s partnership with media organizations, a reader could click on a link to go directly to make a contribution or a gift to Black Lives Matter. Same could be said for the Red Cross for disaster relief.

So, today, Melissa and I talk about the actions that brands are and should take particularly in light of the social change that's going on. We talk about why brands are sometimes uncomfortable to take action around their purpose initiatives and how Public Good can enable some of that. We talk about the erosion of trust in media, government and institutions and why brands are well positioned to call consumers to action and engage consumers. So, great interview, great conversation. So, without further ado, my discussion and interview with Melissa Anderson of Public Good. Melissa, thanks so much for coming on the podcast.

Melissa Anderson:

Well, thank you for having me, Michael.

Michael Young:

Excellent. So, lots to talk about today. Just for the benefit of our listeners, Public Good, it's at the intersection between brands, media and NGOs, social activists. So, could you unpack that and explain the role of Public Good and how you interact with each of those stakeholders?

Melissa Anderson:

Sure, absolutely. And so, I think the best place is to start with really what we do. Public Good is America's leading AI for good technology which makes news and content actionable. So, what I mean by that is if you're reading a story about anything from climate change to domestic violence or social justice to COVID-19 and how it's affecting us. We serve action, right?, within the article that the reader can take to make a difference. So, kind of changing the paradigm of content from being likable and shareable to also being actionable and look, the idea of an action like donate to American Red Cross being an immediate article about natural disaster is not new. But what is new is how scalable our tech can do this on a completely automated basis. So, our sophisticated artificial intelligence machine learning really goes beyond keywords. So, when an article is published, it’s able to truly understand what that article is about and then serve actions that make sense to make a difference and these are on our publisher partner sites including everyone from CNN, HuffPost and Vice to Vox and USA Today as well as local news leaders like Meredith and Gatehouse. And so, we give the opportunity for brands to actually sponsor these actions in the news. So, that does two things. That drives awareness of what those purpose brands are doing to make a difference and it empowers people to make a difference alongside that brand, to participate with the brand.

So, I know you asked me about kind of each stakeholder. So, and kind of talk through that and what that looks like. So, for the for the media partner, I mean really by having these actions and content, they're there changing that feeling that their readers feel after reading bad news. They're feeling bad about what they're reading about in the state of the world to feeling good that they were able to do something to make a difference. And from a business perspective, that drives both reader engagement and changes brand perception. For the brands, it gives them the opportunity to amplify the good work they're doing and drive participation from readers which drives both impact and brand perception for the brand as well. From the reader perspective, we're able to empower consumers to make an impact and to make them happier after they've read the news rather than feeling depressed. And then, of course, the NGO piece of this as the fourth stakeholder, they are the beneficiary in many of these campaigns whether they are sponsored by a brand or if they're non-brand sponsored action.

Michael Young:

Got it. And so, Melissa, what you were just describing, is that your social impact platform?

Melissa Anderson:

Yes, that is our Public Good social impact platform which essentially lives within our actions all over these media news sites. People often ask me I don't know if I see you. I'm like you've probably seen this many times. But we are really the capability behind the actions. They're not always branded. So, if you go to CNN, we're powering all of their COVID actions. If you go to USA Today, we are the engine behind their racial justice actions and we actually just went live today.

Michael Young:

Ride on. Fantastic. Well, and that's an area where I want to dig into. I think when we started talking a couple of months ago just planning this episode, COVID was the big story and since then, we've had the murder of George Floyd and others, Brianna Taylor, Ahmaud Arbery among others and Black Lives Matter has really come front and center. So, there's been a lot of brand response. So, I'd love to get your view of that given where kind of you are in the ecosystem and what's changed since a couple weeks ago, a couple months ago in terms of how brands are interacting along the lines of social action?

Melissa Anderson:

Sure. Yeah. 2020 has been a year of fast and rapid change. So, it feels like so long ago when we first connected. So, thank you for kind of bringing us up to today's moment. I think as I look back over brands’ response beginning in March, yeah, at first, there was this pause of what should we do, this paralysis which is normal. But generally, many brands stepped forward in relatively a very short time frame to activate especially a short time frame when we look at the bigger global brands. And when we look at the responses, we found that really the best responses followed what we've called the ACE framework. And so, A is around act, C is around communicate what you're doing and then E is empowering others to make a difference and either give or get help around COVID. And I can explain more about that framework later but I think a great example of some of the brand response we saw was Nestle. They donated a million dollars to No Kid Hungry to help the 22 million kids who had lost access to their school lunch when schools closed due to COVID-19. And then in addition to communicating that, Nestle empowered families to help find a meal through their online meal finder which is really that final piece and empowered people to get the help they need and to give help as well.

Look, as we turn to talk about the response to George Floyd, Black Lives Matter, at the top of mind especially for me today as I'm reading CNN headlines and Unilever’s recent movement to halt advertising at least through the end of the year. I think what’s top of mind is the Stop Hate for Profit movement. So, for those that may not be familiar, there's a growing number of brands that are boycotting Facebook advertising for the month of July and great to see that not only the Patagonia and Ben & Jerry activists type of brands are jumping on board but also a lot of the mainstream brands such as Verizon and a number of leading agencies urging their clients to join as well. And as I mentioned just an hour ago, Unilever made their announcement and look, this is significant. Their company was the 30th highest spender on Facebook advertising in 2019, pouring more than $42 million into the platform. So, this is really a game changer. I think that this is really going to cause a Facebook and the social media platforms to need to relook at their content in light of losing these advertising dollars and I think that all of this kind of wraps up to say this is a great example of brands taking real action even when there may be a short-term loss of sales when they halt this advertising.

Michael Young:

Yeah. I've been actually very pleased to see that particular boycott come into being and I do hope it has an impact. Scott Galloway, if you follow him, said about Facebook, “This is not about the First Amendment. This is about second gulf stream.” Right?

Melissa Anderson:

Yeah.

Michael Young:

So, it's just about money and I think money talks and if advertisers say hey, enough is enough, you've got to change, maybe finally Facebook will get the message and change. So, brands getting into social action is not new but I think there are always steps forward and missteps. And I guess what action should brands be undertaking and what should they be avoiding in the realm of social action and impact from your standpoint?

Melissa Anderson:

Sure. Yeah. That's a great question and yeah, thanks for bringing it up and I think that does bring us to the framework I mentioned earlier. The ACE, kind of ACE framework which is first act when these issues hit hard and it’s really important to prioritize and get advice as needed to establish where do you want to be as it relates to diversity as an example and your plan for improvement. And then secondly, really focus on communicating. Talk about what you're doing but even more importantly, talk about your plan to get better. Look, most brands don't have an ideal track record if you begin to dig in and look at pay disparity and board representation. But rather than making a big statement or advertisement about what you stand for, consider talking about your commitments and your path forward including the plan of action that you are taking as well as empowering others to take action alongside you as well. And I think, as you mentioned, the George Floyd murder is very I think and racial justice is a scary topic for brands to approach. But if we even look at how the sustainability communication has been effective in saying rather than we're going to be totally sustainable tomorrow, we're committed, it's more of what is our journey. We’ll pledge to cut the carbon footprint by X percent by next year and this type of approach acknowledges that the brand is not perfect but also demonstrates a commitment to improvement. Yeah, I think as you ask what action should brands be undertaking, I think that due to the fear of backlash, a lot of brands have backed away and I think the most dangerous, the most important thing to understand is that silence itself is absolutely a statement. That's a mistake to think by speaking out, you're not staying neutral or staying safe from criticism.

Michael Young:

Yeah. I think that's the really big point and I think what I've noticed and what I've seen and read and heard in talking to other people is that silence is no longer acceptable. Action, tone indeed or the alignment between tone and deed is really what needs to happen. But I think there is going to be some forgiveness for mistakes more than ever. In other words, come out make a mistake rather than sit back and wait for someone else to do the job.

Melissa Anderson:

Yes.

Michael Young:

That I think is maybe and I think because that Black Lives Matter is no longer just African-Americans, it has absolutely transformed almost overnight into multiracial, multi-generational, multicultural, everyone is behind this. Well, I wouldn't say everyone but a vast majority of Americans are behind this and that's the feeling I'm getting in what I've observed is better to make a mistake in good faith than to do nothing and I think the do-nothing part is the thing that's going to have to go away quickly.

Melissa Anderson:

Yes. Yeah. No, I think that's absolutely right on. And then in addition to that, I think one of the most dangerous ways to respond would be to make a big bold statement without an action plan backing that. Said a different way, ads without action does run that risk of backlash. So, I think as you're saying, be brave, do something rather than nothing but do something, don't just say something I think is a good way to sum it up.

Michael Young:

Yes. Correct, correct. How about it? Okay. So, then the media piece is interesting to me in particular. Obviously, I've worked in communications and media for a long time. And so, you're creating some connective tissue then between brands, media, readers. Say more about kind of that role. And I'm going to have Meg Parker Young on the podcast coming up to talk about kind of the role of media and the connection to trust. And so, how do you think about trust and reader connection broadly?

Melissa Anderson:

Yeah. So, I think there are a couple directions to take that. I mean I think that when we think about trust today, I think that major brands are actually in one of the best positions in terms of being a trusted force because consumers are really looking to them to kind of play this role as we've seen trust erosion over time be it with government institutions or media. And I'm hopeful that we can work to rebuild that trust around media, government, institutions over time. But today as background, when we look at the Edelman Trust Barometer, it's clear that people are really hungry for information and that they're looking to brands for that. So, a couple data points that are top of mind out of the Edelman Trust Barometer, one, 78% of people are expecting businesses to engage, help and protect the greater communities they're serving in addition to their employees so to really play that broad role and 80% of people want brand communications to focus on how they're helping people and what people should do, 85% of people want brands to use their power to really educate the public around what's happening with today's pressing issues. So, I think that really the spotlight is turning on brands as a trusted source for information in this really unusual time.

Michael Young:

Absolutely. And I've heard that from Alice Korngold who's definitely a thinker and a thought leader here. I just interviewed Eric Wohlgemuth from Future 500 and it's not that brands can do everything but brands do have great power and that corporate citizenship has to be turned to a real force for good. And the one thing as you were talking, I was thinking a lot about is this interconnection and Eric Wohlgemuth talks about this, about the interconnection now between employees and activists and a lot of changes coming from consumers, absolutely, and especially intergenerational. But it's coming from inside too, right? The call’s coming from inside the building and I think that's also a very positive move is we're starting to see companies really listen to employees and customers.

Melissa Anderson:

Absolutely. And if we think about that employee piece, attracting top talent, retaining your best people I mean are the two most know very important things for a company to thrive and grow market share. And so, both of those are dramatically impacted by how a company is acting or not acting in terms of their responsibilities.

Michael Young:

Yeah. And those factors go off the chart intergenerationally, right? Gen Z and Millennials are just like no more, time out,

Melissa Anderson:

Not doing it.

Michael Young:

Not doing it. Just no, no, no. So, I think again, the forces for change are putting pressure on organizations in a positive way and we are starting to see that movement. So, how should brands be thinking about measuring purpose? Right? ESG stocks are clearly outperforming the market right now. We've got old measures like NPS and satisfaction surveys. In your view, what others tools are out there? How else should brands be thinking about engaging with stakeholders?

Melissa Anderson:

Sure. Yeah. And to double down on your point about ESG, I mean look, from the Business Roundtable to Edelman Trust Barometer to the Harvard Business Review, we're seeing acknowledgment from leading CEOs, business leaders and marketers that consumers are already seeing purpose as their key to purchasing even before 2020. Massive growth of ESG, investing and social responsibility investing as well has been unprecedented and now is measured in trillions and I think shows that even the most results-focused investors the importance of purpose in a company's performance. So, I think what's missing, as you asked me the old terms like NPS and today we're looking at the move in the market, but I think what's missing is translating these high-level goals to targets and KPIs for folks below the C-suite like the marketing, communications, [inaudible 00:21:45] and agencies. It isn’t particularly hard to do. Purpose has measurable significant media impact on virtually all brand affinity metrics like Net Promoter Score which has been repeatedly shown to drive these KPIs like customer acquisition, cost retention and larger scale deployments have been shown to lead to purchasing preference. But all too often discussion of purpose is kind of left to CSR or other parts of big organization that have limited budget. So, they aren't able to activate at a scale that meaningfully moves these numbers.

And so, to get the benefit from purpose, it really needs to be done at scale and that means it needs to be put into people's objectives at really every level of the organization. And some see this as distasteful because it doesn't feel like you should benefit from purpose or translate this into KPIs all the way through the organization but the truth is that the only way to make significant impact is to align it with company outcomes and stakeholder objectives.

Michael Young:

Yeah. If there's anything capitalism is good at, it’s measuring. Right?

Melissa Anderson:

Yeah.

Michael Young:

And why shouldn't this be measured absolutely categorically? And you get what you measure. Right?

Melissa Anderson:

Yes. Exactly. And I think that's that next piece of evolution to take the goal at the highest level of purpose, sustainability, etc. and how can we translate that down to the day-to-day marketing executions that are coming out of the digital marketing departments or the agencies versus metrics like impressions, [inaudible 00:23:38] those type of things that level back up to advertising but don't level back up to purpose and brand sentiment.

Michael Young:

Well, and if it's an engineered soundbite, congratulations but you said purpose is the key to purchase. If that's one of your soundbites, it's amazing. I'm going to maybe use that as the title of this episode. But I think absolutely, categorically, decisions about brands are being made now based on brand behavior that are going to last decades and I think that's really what again, we're seeing in terms of intergenerational pressure on brands and consumer behavior. Consumers are voting with their feet and their dollars and it ultimately is going to ladder up to a material risk issue to bring it back to what the board and the C-suite understand is materiality and risk and this is now a long-term risk issue is if we don't get this right, it is going to impact our survivability.

Melissa Anderson:

Yeah. Absolutely. And as you mentioned, long-term effective survivability, it is really interesting to see that as we look at the—every major brand is going to have a misstep at some point on their journey and for those brands that have a strong consumer sentiment, when they have the missteps, the stocks are down fairly quickly. For those brands that don't have that really trust from the consumer, then those missteps are much more costly. So, we've talked about purpose being key to purchase but it's also just key to this long-term really risk mitigation around everything from purchase to brand reputation.

Michael Young:

Yeah, yeah. All right. Melissa, this has been a fantastic discussion and we're going to check back with you in the months ahead. We're coming to the end of season one. So, I expect an invitation back later in the year, maybe early next for season two to continue this discussion because I think your unique position, Public Goods Software's position is going to ultimately prove out to be very vital as brands and media and consumers continue to intersect. So, I'm very grateful to you for your time and your insights today. Thank you so much.

Melissa Anderson:

Well, thank you so much. This has been a pleasure and I really look forward to rejoining as the year progresses.

Michael Young:

Fantastic. All right. We're going to leave it there. Thank you.

Melissa Anderson:

Take care. Bye, bye.

Michael Young:

Bye.

Michael Young:

The Purpose, Inc. Podcast is a production of Actual Agency, helping innovators communicate in a changing world. More at www.Actual.Agency.

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