Business models are evolving every day, as technology advances and the world becomes smaller new market opportunities arise. Like the saying goes, the early bird gets the worm. The sooner you catch these new business models the easier is going to be for you to put your company in the spotlight. Thankfully, new business models are being affected by altruistic personalities. In 2006 there was a company that stole the spotlight for a pretty radical business model. TOMS founded by Blake Mycoskie was the brand that acquired the model of one-for-one and became an international sensation. Also known as a buy-one-give-one model, today there a still many brands that still use this strategy.
When business models involve the client and empower them success is achieved.
Thanks to advanced communication technology in the 21st century, people become more aware of global issues faster. I believe all humans have some level of empathy. At the core of our being, we want to help others if possible. If you are presented with the opportunity to give something to a needed community by simply buying the pair of shoes you where gonna buy anyway. The chances of you making that purchase become higher, you are not just buying for yourself anymore. Having the customer care enough to make a purchase is what I find interesting on a psychological level.
Environmentally Friendly Business Model
When business models involve the client and empower them success is achieved. A recent model that is spreading fast is the, in lack of a proper name lets call it, Environmentally Friendly Business Model. It’s relatively new, I believed it started about four years ago. I define this model as a brand that aligns itself with a cause and donates a percentage of their profits to charities that align with said cause.
Take for example Sand Cloud here is the Wikipedia description: “Sand Cloud Towels is a beach lifestyle company that sells beach towels and beach blankets. They also make shirts, leggings, and accessories like phone cases and stickers. Sand Cloud sells through their website and other retail outlets and donates 10% of net profits to marine life foundations, such as the San Diego coast keepers, Pacific MMC, and the surfrider foundation.”
Sand Cloud is aligning itself with a cause: saving our marine life. And then explain to the consumer that they donate 10% of profits to organizations that work to save marine life. So even though Sand Cloud doesn’t do the research and the rescue like the non-profits do, by associating themselves with those organizations they change the perspective of the buyer. The company is no longer a greedy capitalist, they have humanized the brand.
I found Sand Cloud through Instagram and became an Ambassador within 30 minutes of finding it. This brand did something powerful to me and to many others. It engaged my attention, brought attention to a global problem, made me feel part of the solution and managed to make a sale in 1 hour of me discovering them. That is good business. And I believe it can be scaled to a much larger scope. I believe the reason these “radical” models are successful is empathy. I’ve seen new brands popping up all the time with this model. Another example would be BottleWell, they promise that a single purchase provides a family with clean water for 20 years. If humans really didn’t care, these models would have failed. But thankfully we do care.
We always knew
The thing is, we have been learning this in business classes for a while. But only now actual businesses are giving back to the community or the environment or the world. Look at the empathy map my teachers taught me in university:
We used this map to understand our user/customer/client/stakeholder on a
stalker deeper level. We also create personas in order to do the same thing. Personas are archetypes of the end user. A persona works like a singular icon of an entire group, we make a persona based on user research, we write a description of their attitudes, behaviors, goals, personal details and skill sets. And all because of how important we already knew empathy is. The problem was we were just using different labels for it. Or creating new maps in order to understand the client. When in reality we need an Empathetic Business Model.
As Irwin Kula stated on his article Empathy as Business Model: “As customers are empowered in unprecedented ways to damage brands for behaving badly or being inauthentic – and as businesses are similarly empowered to know exactly what customers want (not need) and to target them ever more cleverly? – we will indeed require empathy.” Humans have always shamed other humans, and this has been the era of shaming companies too. Now companies are being included in the moral scale, we no longer buy from companies that don’t support our values. For example, the ongoing battle that Greenpeace is holding with Wilmar International, the supplier of palm oil that is destroying forests in Indonesia. At least three companies have changed to a sustainable supplier. That is the power of empathy.
Empathetic Business Models have just started.
Companies can’t present themselves to the consumers as money making machines. We finally care enough to boycott the company that is destroying Indonesia’s forest. We care enough to buy a pair of shoes because we know a child in need will get one. We also care enough about preventing the extinction of our animals, or to fight for access to clean water. We do care for other humans and our planet. And companies need to take note and start acting how their users expect them too.
This is just the beginning
Empathetic Business Models have just started. It can be as simple as 4Ocean’s, here the Wikipedia description: “4ocean is a United States company selling bracelets made of recycled materials. The company promises to remove one pound of trash from the ocean and coastlines for each bracelet they sell. 4ocean sponsors events where volunteers remove trash.” Really easy to understand right? Buy a bracelet online, one-click away and the company will do the work for you.
I’m going to work on a table for Empathetic Business Models for a future post. I’ll start with the questions:
- What is a must-have feature to be considered empathetic?
- Is it necessary for the stakeholders to be aligned with the values as well?
- Do you always have to donate a product or profits to be considered empathetic?
- Does the company have to be aligned with a global cause, could it be local?
I feel like there is so much to explore on this subject. Please share with me your thoughts. I would love to engage in conversation and share ideas. And don’t forget to check the related articles for some extra information about how empathy is changing our businesses.
- The Empathy-Driven Business by Alexander Vonnemann and Fabian Pehlke
- Empathy as a Business Model by Irwin Kula
- The Final Countdown: Now or never to reform the palm oil industry by Greenpeace International
- Empathy as a Key to Business Success by Tim Berry