How effective storytelling builds brand loyalty

Patagonia has built its brand on effective storytelling that consumers trust.
Budrul Chukru—SOPA Images/LightRocket/Getty Images

If there’s a theme that’s emerged from this May’s run of reporting on trust in advertising, it’s the value of authenticity in building brand loyalty. As I touched on two weeks ago, being authentic also means accepting criticism.

For Steve Clayton, Microsoft’s chief storyteller, which was a role the company created when they hired Clayton for it in 2010, the ability to criticize his employer was the factor that kickstarted his career. 

As Clayton tells it, he was working as a systems engineer at Microsoft in London and keeping a public blog on the side, where he was honest about what he saw as the company’s successes and shortcomings, advocating for how the aging tech juggernaut could improve. The blog caught the eye of a VP in Microsoft’s corporate communications department, who decided to take a punt on Clayton’s honest approach.

“His idea was that, instead of continuing to hire traditional communications professionals into the communications function, what if we hire a passionate evangelist for the company?” Clayton told Mario Juarez in a 2019 interview. That VP then gave Clayton permission to bypass the traditional corporate PR channel, of having press releases vetted and approved, and to “just hit publish” on his own, honest blog posts.

Microsoft’s soaring sales revenue and ballooning share price in the decade since embracing storytelling suggest the approach worked. Tomes of academic research shows that consumers respond favorably to brand stories that resonate on an emotional level, too, purchasing more often from brands that resonate with them than other companies. 

“Increasingly, we know that consumers are more motivated by richer brand stories that have meaning for them,” Duncan Steels, vice president of customer transformation at consultancy Capgemini Invent, told me last week. “People are typically more predisposed to trusting brands that feel honorable.”

But crafting an appealing story is a long process. Unlike ads for specific products or new developments (which can also be built around storytelling), a brand’s storytelling is a permanent, ongoing campaign, centered around the business’s core values.

“I think the main test of a story is how often it’s told and how consistently. That’s what creates credibility and trust,” Vincent Stanely, the unofficial chief storyteller and director of Patagonia, said in a 2021 interview, bringing up again the value of authenticity in branding.

Stanley says the more a brand tries to “invent a story about their enterprise…to cast themselves in a good light or to drum up business, people tend to lose their creativity and they lose their ability to connect with the customer.”

In the years since the signing of the Paris Agreement on climate change in 2015, hundreds of companies have tried to reinvent their brand stories to “cast a good light” on their business and highlight their sustainability efforts. And, indeed, many businesses have lost that connection with their customers because of the change. 

Next month Trust Factor will be looking at the issues of greenwashing and the pushback on “woke” capital, spotlighting where such radical reinventions of a brand’s story have and haven’t worked.

Eamon Barrett


Influential footwear
“Hopefully we can reach a massive audience that will appreciate the authenticity—that we really, truly believe in this,” TikTok star Dixie D’Amelio told Fortune’s Alexandra Sternlicht about the new footwear line her family’s D’Amelio Brands launched last week. Whether the shoes sell will be a “test of the loyalty and purchasing power of TikTok audiences,” Sternlicht writes, and whether TikTok stars have the same selling power as YouTubers.

Tesla's reputation tanks
Tesla has suffered a massive collapse in consumer confidence, according to the latest Harris Poll survey on brand reputation. The EV company, helmed by Elon Musk, plunged 50 places down the poll’s ranking of the 100 “most visible” companies in the U.S., landing 62nd on the list. The poll doesn’t reveal what exactly caused the plunge, but Tesla declined across all metrics, including company culture and ethics.

Meta data
Ireland’s privacy watchdog has hit Meta with a record-breaking privacy fine of €1.2 billion ($1.3 billion) over the tech giant’s illegal transfers of European users’ personal data to the United States—and perhaps more importantly, has ordered the company to stop sending any more of that information across the Atlantic, David Meyer reports.

A.I. oversight
Microsoft has called for Washington to create a new regulatory body to have oversight on the development of artificial intelligence and issue licenses approving companies to work on general A.I. applications. The company’s position echoes calls by the likes of Sam Altman, the CEO of OpenAI, which has a partnership with the tech giant.


Next month, Trust Factor will be looking at the world of sustainability, climate pledges, and greenwashing, so it seems appropriate to end this month with a comment from former Unilever CEO, Paul Polman, on next week’s Plastic Treaty negotiations in Paris:

"Predictably, some companies are lobbying hard to undermine the talks, led by petrochemicals and fossil fuels. It’s no secret that, as our societies embrace renewable energy more wholeheartedly, many in fossil fuels see the fast-growing plastics sector as a lifeboat."

But, Polman says there’s hope in another lobby group, the Business Coalition for a Global Plastics Treaty, to which Unilever is a party.

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