Branding, Culture, Politics, and Everything in Between

I recently bought Robert Reich’s book “Supercapitalism”, which has been getting a lot of media coverage lately. Reich is a former minister from Clinton’s cabinet with some pretty interesting things to say. I haven’t read the book yet (have to get the thesis out of the way first), but this review by Lawrence Lessig made my buy the book from Amazon. From Lessig’s review:

As I said there, we need to understand the nature of the corporation — to make money — and come to love it, and yet, to keep it in its proper place, just as you can love a tiger, but know that it’s not the sort of thing that should play with your kid. [...] Corporations are not more efficient governments. They are instead increasingly efficient money making machines. And while there’s nothing at all wrong with money making machines — indeed, wealth and growth depends upon them — there is something fundamentally wrong with trusting these machines to restrain the drive for profits in the name of doing the right thing. The cushion that enabled that in the past (relatively limited competition) is gone. The job of GM is even more now to make money for GM.

I’ve been thinking about this lately. It is indeed true that a corporation’s sole purpose is to generate maximum profit, but is this really in contradiction with doing “the right thing”? As Holt argues in “How Brands Become Icons” (and his academic articles), brands that manage to make themselves into being “more than about making money”, i.e. being about some higher cause or mission, are the ones that become iconic. In other words, the most successful brands (and most likely most profitable) are the ones who … don’t aim to maximize profits – at least in the short term. Google is a good example; they’ve done a good job of managing their “do no evil” image (although the murmurs are getting louder every day) by investing billions in environmental initiatives and by creating an organizational culture that fosters innovation and playfulness by allowing initiatives that on the surface seem crazy and downright wasteful (Google Copernicus, anyone?) Apple has resisted short term profiteering by keeping their product line relatively narrow and I think that as a company they really are about something else than maximizing profits, call it “Think Different” if you will. Both Google and Apple enjoy extremely high stock prices at least partially because of their way of doing things.

This makes for an interesting situation. I think Reich is absolutely right in saying that we shouldn’t expect for brands to do the right thing, but in my opinion brands do better when they actively resist maximizing profits – especially in the long term. Of course, this only applies to identity and consumer brands, I don’t see how ExxonMobile would do any better than their current obscene profit margins by doing the right thing.