When agents for Prudential Asia (a FleishmanHillard client) in Vietnam discuss their products and services with prospective clients, they make a point to note that their employer holds roughly 55 percent of the country’s long-term debt. Those holdings make Prudential Asia one of the largest investors in the Southeast Asian country. “We are effectively taking people’s money and putting it back into the roads they drive on and the schools their children attend and the hospitals that take care of them,” said Barry Stowe, Prudential Asia chief executive officer.
Prudential Asia is one of a growing number of companies looking to create – and promote – shared value with their customers. The concept of creating shared value (CSV) has been floating around for a while, but the term itself is still fairly new.
“Corporations, brands, organizations – they’re all trying to figure out what it means to them,” said Mary Sadeghy, a nonprofit business developer and marketer in Los Angeles. “It’s an evolution where we as a country and a society – as consumers – want to have a positive impact. People support brands and companies that are making that positive difference in the world, that are committed to doing good.”
Stowe called shared value the “secret sauce” that makes his company grow faster, attract and retain high-quality employees and uphold its promises to customers. He’s careful to differentiate shared value from social responsibility. “We’re talking about something that’s really much deeper,” he said.
Sadeghy thinks Stowe is on to something. In the not-too-distant past, companies simply wrote checks to nonprofit organizations and called it a day. “It used to be just a PR slap-on,” Sadeghy said. “Companies went for the obvious. Maybe they put a pink ribbon on their packaging or wrote a check for children’s cancer. Clearly, that’s something everyone is passionate about. But consumers are demanding that brands be more authentic. They are asking, ‘Why are you supporting that?’ When consumers see a real connection, when they see it’s not just about driving purchases, they really get on board – and they’re loyal to that brand.”
Sadeghy cited Dove, which has created a movement about empowering young girls. “It’s way beyond just making a donation to XYZ charity,” she said. “Levi’s is working on water conservation. They are researching new production methods to reduce water waste. Making denim uses a ton of water, so it’s a great, authentic brand pairing.”
Sadeghy argued shared value is a must-have for business: “If you are a sophisticated, global brand, you have to be thinking of CSV as a really integral part of your business model and marketing strategy. That idea that consumers want to be part of the solution for society’s problems is driving an awakening in brands that it can’t always only be about the bottom line. Businesses have to decide: What is authentic to our brand?”
For Stowe, the answer is simple: “We are doing good work,” he said. “We are creating wealth for families, we are creating infrastructure. And it is absolutely impossible to quantify with any precision.”
But by virtually any metric, Prudential Asia is doing very well. Its business is growing faster than its rivals. According to the company’s findings, its salespeople are 30 to 100 percent more productive than competitors. Its employee turnover rate is half the industry average in some of its biggest markets.
Sadeghy suggests shared value is likely a big part of Prudential Asia’s employee satisfaction and engagement. “Employees want to have a positive impact on their community, too,” she said. “It’s exciting for employees to know their company is working to solve problems. They feel better about working for organizations that are making a difference.”
The biggest pitfall in shared value is trying to fake it, or using it as a crutch to support an ailing brand. Sadeghy points out BP’s work for the environment following the Deep Water Horizon spill in the Gulf of Mexico. She said it was a good idea, and a good fit. But then the company used its effort as a marketing platform to trumpet what an environmentally friendly company it is. “There was a lot of backlash,” she said. “Consumers are too smart and savvy. They won’t let you use a cause to trick them.”
Photo credits: Barry Stowe (Prudential)