What Business Are You In... and Why?

People don’t buy what you do. They buy why you do it. Does your organization know its purpose?

In 1960, Harvard Business Review published a famous article by Theodore Levitt called “Marketing Myopia.” Levitt made a powerful argument that organizations should stop defining themselves by what they produced, and instead reorient themselves towards customer needs. No one had so aggressively and practically made the case for centering on customers.

In 2009, Simon Sinek took a slightly different approach to this concept with what he calls “The Golden Circle”. He asserts that people don't buy what you do. They buy why you do it.   

Sinek’s Golden Circle has three layers:

Why? – The core purpose of the business. It's why the business exists. 

How? – The value proposition of the business. It’s your secret sauce.

What? – The products and services that your business delivers. 

Sinek says that many organizations focus on the “what” but don’t do a good job articulating their “why”, often dismissing it as “fluff”. By articulating the “why”, people who share those fundamental beliefs and passions will become customers and your most loyal advocates. It’s key to attract and retain customers.

The Impact on Customer Acquisition

There are a few key foundational elements to your marketing and sales efforts. Those elements include what target audience you focus on, in what channels you’ll reach them, your value proposition, your messaging, and points of differentiation that will lead them to you versus another solution. 

The “how” and “what” in the Golden Circle help get to those foundational elements. However, it’s impossible to effectively craft your messaging and build your brand without knowing your “why”.

With the right efforts, many of your best prospects will find you versus you finding them. With knowing and understanding your “why”, you can craft the right strategy that yields concrete results – leads and conversions.

The Challenge of Getting to “Why”

Part of the challenge for many business leaders is that if customers are buying and a business is growing, it’s easy to get comfortable. An expanding market keeps an organization from having to think very hard or imaginatively. Let’s face it, during times of growth, many don’t give much thought as to how to expand and often assume it will continue.

But time and again, expanding markets don’t guarantee success. Others can come in and fill a need that you aren’t. The railroads did not get into trouble because there was no longer a need for passenger and freight transportation. It’s just that cars, trucks, planes, and technology filled the need better. It’s because they didn’t know “why” they were in business – what purpose they were serving. Therefore, they didn’t innovate their “what”. They just thought they needed more of what they had.

The other challenge is changing a mindset. Many business owners feel that the efforts that do not directly “sell” a product or service specifically are wasted marketing dollars and sales efforts. With technology, the buying process has changed dramatically. With the right efforts, many of your best prospects will find you versus you finding them. With knowing and understanding your “why”, you can craft the right strategy that yields concrete results – leads and conversions.

Three Examples of Companies That Really Know Their “Why”

Nike doesn’t just sell shoes. They sell many products and services because they are crystal clear about their “why” which is “inspiring the athlete in all of us”. If Red Bull was just in the energy drink business, would they have orchestrated Stratos, where Felix Baumgartner did a freefall jump from 128,000 feet? That freefall jump makes sense for a company whose purpose is “helping us live our lives to the absolute extreme”. It builds their brand and their connection in their customers’ lives. 

Ok, those are consumer examples. You say those don’t apply in B2B. Let’s consider Marketo. Marketo is a marketing automation software company. They are on a mission to solve marketers’ biggest challenges of today and tomorrow. They have created an initiative and community called “The Marketing Nation”. This community is made up of marketing peers to help each other become better marketers. If they were just selling marketing automation software, they wouldn’t have created the community.

The Sports Sales “Why”

So for those of you in the business of selling a seat or a suite, is your purpose to maximize utilization? Or are you helping people create memories or traditions? Or are you one that helps people fulfill their dreams to be part of the action? Or are you giving them an opportunity to spend time with friends or relive their childhood? And is that purpose just on gameday? Or can you make an impact on their lives outside of just those days? 

It’s worth a little time to figure out what business you are in and the purpose you serve. It will enable you to innovate products, services, and programs that help make deeper connections to your current and future customers.

 

About the Author: Nancy Koors has over 25 years of experience as a strategist, marketer, and operations executive in the professional services and technology industries. She currently consults with companies, from startups to mid-market leaders, on their customer growth and retention strategies. Her Customer Acquisition Bootcamp teaches businesses how to integrate inbound and outbound efforts to find their next customers. To learn more, visit www.findyournextcustomers.com.

Nancy also has partnered with the ALSD to launch the WorldWide Club – custom-curated, bucket-list experiences offered exclusively to ALSD member customers.

 

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