In 1960, HBR 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 re-orient themselves toward 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/your secret sauce.
- What? – Products & Services you deliver.
Sinek says that many organizations focus on the “what” but don’t do a good job articulating their “why” and often dismiss this 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.
Why? and the Impact on Customer Acquisition
There are a few key foundational elements to your marketing and sales efforts. 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 vs. 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?
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 think 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 vs. you finding them. With really knowing and understanding your “why”, you can craft the right strategy that yields concrete results: leads and conversions.
3 Examples of Companies That Really Know Their Why
Nike doesn’t sell just shoes, but they sell many products and services because they are very 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 customer’s lives. Ok – those are consumer examples. You say those don’t apply in B2B. Let’s take 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.
It’s worth a little time to really figure out what business you are and the purpose you serve. It will enable you to innovate products, services, programs that help make deeper connections to your current and future customers.
Nancy Koors is a co-founder of Growing B2B. GrowingB2B helps businesses build a marketing-led lead generation effort to enable sustainable growth. To make sense of the complexity of the customer acquisition process, tools and identify how to better align your marketing and sales efforts, join GrowingB2B at the Customer Acquisition Accelerator Bootcamp. Register Now as it starts January 12, 2017. If you can’t make the bootcamp or just need help developing or improving your customer acquisition efforts, contact Nancy here.