Turning the Tables: Leveraging Purpose as a Strategic Advantage for <scp>SMEs</scp>

ABSTRACT When executed well, purpose can become a transformative force, turning a business into a breakout success. Despite the wave of purpose‐driven businesses in recent years, the concept of purpose remains underdeveloped. Purpose is a core component of business models but is difficult to retrofit into large corporations, which makes it especially valuable to understand how SMEs can effectively leverage purpose to differentiate themselves from bigger players. The study follows a constructivist grounded theory approach, using a comparative multiple case study design and qualitative content analysis. A key outcome is a conceptual framework that identifies critical components of brand purpose. The framework shows start‐up and SME managers which components are essential to crafting a purpose, to strengthen its clarity, appeal, and motivational power. It supports managers in the process of developing their purpose, integrating it into their business, and illustrates best practices that explain why and how these components can be used to communicate their purpose to both internal and external stakeholders.