Friends,
I hope that all is well with you and yours, and that this e-mail finds you on a boat with shoddy connection, in the tropics, three months after I sent it.
In today’s newsletter, we discuss the purpose paradigm and how the tide is starting to turn. For premium subscribers also decision-making under radical uncertainty, the danger of indexes, AI’s fuel demands, and Bill Gates’ naïveté.
Now accepting keynotes for 24Q4-25Q2
Every year for the last decade or so, I have created three main presentation decks. For 2025, however, I have (for the first time) added a fourth due to popular demand. They are:
What to Do When You Don’t Know What to Do: How to turn change into a competitive advantage. (Based on the new book by the same name.)
Pushing the Envelope: How to create and nurture an innovative organization.
Resilient Retail: How to survive and thrive in the modern marketplace.
The Unknowable Unknowns of Artificial Intelligence: How to manage an unquantifiable risk.
If you want to book me for your event, corporate speaking slot, or workshop, merely send me an email. To make sure I am available, please do so at your earliest convenience; my availability is limited and the schedule tends to fill up fast. More information may be found here.
A couple of updates before we go-go
As some may remember, a couple of months ago, I had to take my two-and-a-half-year-old daughter to the hospital to have her eyesight checked. It turned out that she had, for some reason, lost a significant part of her vision on one eye. Naturally, we got her glasses and she has been very good at wearing them. However, when we went back for a checkup on Tuesday, despite great improvement, there was still a ways to go.
In order to get the eye going again (kids’ eyesight work slightly differently than ours do), she now has to wear an eyepatch for a few hours a day. No complaints as she put it on, even though it markedly worsened her vision (the patch goes over the “good” eye). Then, as she got to take it off again a while later, she looked at her mother and said “mom, is my eye strong now?”.
The very next day, she came up to me as I was doing some emergency plumbing due to our cleaning woman having been a bit, shall we say, over-enthusiastic. “Dad, I need to train my eye. Will you help me?”
Kids, man. They get you right in the feels.
On a completely different note, I rarely discuss politics in this space, but Jesus Kenneth Christ on a unicycle juggling kittens has the US election jumped the shark. The choice, as far as I can tell, stands between mental decay and moral decay. That either candidate was allowed to represent their party says a lot and none of it good.
Having said that, I trust the people around Biden to make up for his deficiencies. The evidence is overwhelming that the people around Trump will not make up for his.
Lastly, I chucked out a question on LinkedIn yesterday about new thinking. Turned into a pretty interesting conversation overall.
Moving on.
The Purpose Paradigm Redux
A turn of the tide
A long time ago, I wrote a column on so-called brand purpose that would become the closest to an evergreen piece of content I have ever spat out; it got me interviews in large newspapers, on national TV shows, and landed me on some journalistic list of people to contact in the event of, well, events. Today, the topic is as relevant as ever, though perhaps not in the sense that many of its proponents had envisioned.
I did warn them. As I wrote six years ago:
[T]he supposed evidence for brand purpose as an indicator for future success has been proven to be severely flawed and ostensibly a systemic delusion resulting in a halo effect. Though proponents often claim their views are based on rigorous research, they operate mainly on the level of storytelling.
Today, slowly but steadily, it feels as if the business world is starting to catch up.
Now, to set the appropriate expectations, I am not going to go into a long spiel about the history of purpose, where it came from, its most common forms, and so on. If you are interested in that, I would recommend Nick Asbury’s new book The Road to Hell (his newsletter is also very good). Instead, I will merely observe that purpose, DEI, ESG, and so on, neither collectively not individually constitute a lever that one can pull to automatically generate profit. Despite infamous McKinsey claim to the contrary, they never did. As far as I am concerned, the biggest mistake the purpose brigade did was to believe it could prove otherwise with the scant available evidence; once the proverbial cat was out of the proverbial bag, not only were reluctant executives given an easy way out, but it also provided a perfect setup for conservative voices to go “see, we told you so; they were lying”.
And so, despite what you may have heard out of one particular PR firm at Cannes, a number of brands (from Bud Light to Tractor Supply) are now starting to backpedal. Many have already publicly changed their tunes, scrapped campaigns, eliminated jobs focused on DEI, stopped sponsoring Pride events, and even withdrawn carbon-emissions goals. More are about to. Admittedly, things may be slightly different in Europe, as there is new EU legislation on ESG coming. But I know from personal experience that many companies will only do it because they have to - and not devote so much as an extra second’s worth of effort beyond the bare minimum.
It is an unfortunate turn of events, but one that was logically inevitable the moment people such as Jim Stengel started claiming that purpose was the best financial choice for businesses. If one argues that the reason for doing ESG and DEI is entirely based on profits, it follows that one would do the opposite if it were better. Much as companies clearly choose to when, for example, not paying their taxes.
The situation was, I believe, made all the worse by the endless posturing and holier-than-thou sneering from the people leading the charge. As I wrote in a column in January of 2020:
These days, it seems you cannot be in a room with a group of marketers for even two minutes without being force-fed the latest spoonful of Weed-tasting brand purpose rhetoric. One after another, they line up to tell you how their brands are no longer providers of goods or services, but changing the world for the better.
Come to think of it, consumers should be so lucky that they exist. After all, what is the best way to increase diversity if not through buying a deodorant?
Just don’t look at what the marketers themselves are doing. While perfectly happy to tell anyone within earshot at Cannes how important diversity is, an embarrassingly low 11% of the (more than 1,000) award-winning entries came from agencies with an equal gender split at department and board-level. Less than 2% of Cannes Lions attendees were people of colour or from underrepresented communities.
As it turns out, most agencies, and many marketing departments, are made up of the same kind of people, in the same kind of age bracket, with the same kind of backgrounds and the same kind of beliefs, values and biases. In other words, while happy to lecture consumers on diversity, marketers themselves turn out to be as good at it as a goat’s arse is as at playing the clarinet.
There is an absolute point to doing right in the world, and diversity (in all its forms, so long as it goes beyond the superficial) is far more likely to be a benefit than a hinderance in contexts where difficult problems, innovation, or insight generation are important. But many purpose related efforts add costs, and if you do not have a strong evidence base to justify them, you have to argue on morals and principles - at which point you may well find yourself back on square one with the advertising agencies that assume that the entire world is liberal.
Ultimately, what people say and what people do are different things. GenZ survey radicals become fiscal conservatives when their own money is on the line; more than happy to claim that they only buy from brands that stand for something while shopping from Shein in real life. The same applies to companies. As we know, the employers that are the most enthusiastic about their values also tend to be the ones that live up to them the least in the eyes of their employees.
If you are a strategist, you will inevitably incorporate your own worldview into your work. The question, as ever, is where you draw the line. There is nothing wrong with taking a stand, nor wanting to make the world a better place. But you had better be prepared to stand up to those who have opposing views - and the lost purchases that may follow.
After all, as Bill Bernbach once said, a principle is not a principle until it costs you something. As plenty of brands are now starting to find out.
Until next time, have the loveliest of weekends.
Onwards and ever upwards,
JP
This newsletter continues below with market analyses and an additional column exclusive to premium subscribers. To unlock them, an e-book, and a number of lovely perks, simply click the button below. If you would rather try the free version first, click here instead.