Patagonia: The King of Chemistry
Enigma’s CEO John Gutteridge’s take on why he thinks marketing has played a small but significant part in Yvon Chouinard's - founder of Patagonia - decision to make a $4.4 billion bequest to NFP, Holdfast Collective.
Yesterday, Yvon Chouinard – founder of Patagonia, eccentric rock climber and reluctant billionaire – made headlines for giving away his circa $4.4 billion business to trust and non-profit organisation, Holdfast Collective. The bequest takes philanthropic efforts to another level and places a spotlight on other global billionaires whose rhetoric about sustainability and climate change might fall on deaf ears unless they follow up with significantly greater actions and consistency.
It’s fascinating to think how this $4.4 billion was created, and how that colossal amount of money is now funding the efforts of the good guys, dedicated to fighting our environmental crisis. I can’t resist but say marketing has played a small but significant part in all of this.
Why? Because responsible business practice is now a business imperative, not a ‘nice to have’. Culturally Australians demand accountability when businesses tout their environmental credentials; they often make choices about the role brands play in their lives based on an organisation’s environmental advocacy. For marketers, this has multiple implications, but the single most important focus right now should be about building and nurturing relationships with current and prospective customers.
Patagonia is a brand that has put so much effort into being authentic and true to its values and purpose. Essentially a business that has built an incredible bond with its customers and now is known globally for driving profit through purpose. After hitting rock bottom in 1991, the business made a conscious effort to rebound by authentically staying true to its values and creating visible actions to raise awareness of its commitment to sustainability and advocacy. Their stance on Black Friday/Cyber Monday and the Worn Wear program created enormous affinity with their customers. Communicated at various touch points throughout the customer journey in a way that was memorable, authentic, and unorthodox, which created the all-important desirability and passion which ultimately led to great chemistry between the brand’s offering and its customer base.
Today, so many brands that have learnt and copied Patagonia’s purpose driven approach that it’s almost become table stakes in the marketing world. Patagonia’s success isn’t simply a consequence of their purpose and values. It’s the combination of this and the way they’ve communicated it and the consistency of when and where in the customer journey. This is how the relationship has been built.
Relationships are complex. Honesty, trust, authenticity and respect all play fundamental roles in the strength of a relationship people have with people. And the same is true when it comes to relationships between brands and people.
A recent study in collaboration with Dr Shane Moon and Neurons essentially revealed two key components to building brand relationships: Affinity and Chemistry. Affinity occurs when something resonates, typically values, purpose and likeability. Chemistry is a little more complex, subconscious and uncontrollable, but immensely powerful when realised.
Chemistry occurs when there are ‘multiple meaningful moments’ created between a brand and a consumer throughout a customer journey. During this time a flow is created, and an interdependency occurs. In its simplest form it mirrors the behaviours and emotions that create chemistry between people and yields tangible results for brands. According to the study, chemistry will result in a person 5x more likely to try something.
Now let’s look at the current climate. Businesses and brands will continue to face challenging times over the next 18 months. Next year’s global growth forecast is the lowest outside a recession year since 2008, and it’s predicted the US will tip into recession in the first quarter. In Australia, inflation is at its highest since the early 1990s and is forecast to increase further by end of year, with consumer price inflation tipped to reach around 7¾ per cent before declining in early 2023.
For marketers, this has multiple implications, but the single most important focus right now if you want to replicate the success of a business such as Patagonia, should be about building and nurturing relationships with current and prospective customers.
Who knows, that money might end up creating the next Holdfast Collective in the future.
John Gutteridge, CEO Enigma.
