The relevance of a Purpose-Driven Strategy in enabling FMCG companies to sustain long-term Customer loyalty and optimal Financial Performance : a South African perspective

Abstract

In recent decades, purpose has remained one of the most prominent subjects in business sciences. Despite this, the evolution of purpose-driven and its underlying conceptual framework remains opaque and unavailable to guide companies in their strategic interventions. Using data from a sample of 266 employees in the FMCG industry in South Africa, this study examined the relevance of a purpose-driven strategy and the key enablers to sustain long-term customer loyalty and optimal financial performance. Significant positive relationships between these core business concepts were discovered. At a time when social and environmental consciousness around capitalism is emphasised, companies must advance this agenda with all stakeholders. This is evident in the data; employees are drawn to a greater purpose, ethical leadership, and a meaningful corporate culture. This study formalises the significance of a purpose-driven strategy and demonstrates how achieving this correlates to customer loyalty, financial growth, and financial consistency. In this quantitative analysis, critical enablers that might serve as a roadmap for companies are identified. Furthermore, financial growth potential and financial consistency can be achieved through the optimisation of financial performance and a strong association exists with a purpose-driven strategy and customer loyalty. Finally, this study provides empirical evidence which supports the relationships between purpose-driven strategy, customer loyalty, and financial performance.