Why You Need To Create A Purpose-Driven Business
Building a successful business is about more than just creating a great product. Many companies have products or services that are similar in price, quality and function, yet only a handful excel in their given industries. Why is this?
The answer lies in a simple but powerful model. It starts with a golden circle and the question “Why?”.
If you haven’t heard of Simon Sinek, you’ve probably been living under a rock (welcome back!) for the past five years. But don’t worry, he’s about to teach you one of the most important business strategies on the planet. Seriously.
Sinek is a New York Times best-selling author, world-renowned keynote speaker and consultant who writes on leadership and management. His work has been featured in numerous publications around the world, including the Wall Street Journal, FastCompany, NPR and The Huffington Post, to name a few.
In 2009, Sinek gave a TEDx talk called “Start With Why – How Great Leaders Inspire Action.” Little did he know, but this speech would transform his career and catapult him into the spotlight as one of the world’s foremost experts on marketing, brand identity, company culture and leadership. I would highly encourage you to watch it.
Let’s explore why his message had such a profound effect on the global psyche, and uncover what it means and how it applies to young entrepreneurs.
Most companies make a fatal mistake right off the bat. The problem? The majority of businesses tell customers WHAT they do. But they don’t tell customers HOW or WHY they do it.
Truth is, some companies drift so far off course that they forget why they even started in the first place. This is a recipe for disaster. It’s so important to establish ‘Why’ you do what you do.
According to a 2016 Gallup poll, a mind-boggling 87% of millennial workers worldwide don’t feel “engaged” at work. The workforce is facing a crisis of identity. Outside of generating a profit, most companies just don’t know why they operate. And it clearly shows in dreadful employee engagement statistics.
The effects of a purposeless company aren’t just felt internally. Research from Edelman’s ‘5 Year Good Purpose Study’ has shown that upwards of 80% of U.S. consumers are “more likely to purchase from a company that can quantifiably show how it makes a difference in people’s lives—beyond just adding to the investment portfolio of a very select few.” Here are more findings from the survey:
- 72% of consumers would recommend a brand that supports a good cause over one that doesn’t.
- 90% of consumers surveyed said that a brand with a cause would make them more loyal.
So what does this mean? Well, changing demographics and new psychological motivations are forcing companies to think differently about how they approach brand identity and marketing.
Start With Why
To help you understand how you can apply the ‘Start With Why’ principle to your business, let’s explore this strategy in action.
Here’s an example. Ok. So, I run a company that sells women’s clothing online. I’m trying to reach $10 million in sales for 2017 as part of a hyper-growth strategy. How inspired would you feel to purchase my clothing if you read this?
What / How Approach:
“We’re Femme – and we make and sell women’s clothing online. We have millions of customers in 34 countries worldwide. Our clothing has won many awards. Celebrities wear it. It’s the best! We even make it ourselves. Want to buy some?”
I don’t know about you, but I’m not going to be buying clothes from Femme anytime soon (forget the fact that I’m a man for a second!). Now, this is what the same message looks like when you ‘Start With Why’.
“We’re Femme – and we’re passionate about changing the world. Our mission is to redefine the way you look and feel. We’ve changed millions of lives in 34 different countries so far. And this is only the beginning. So what are you waiting for? Join the revolution today.”
Notice the difference. When marketing and sales strategies leads with ‘What,’ the message feels hollow, empty and downright boring. However, when you ‘Start With Why,’ you change the focus and align with a higher aspirational purpose. This message is stirring, strong and inspiring.
In fact, the ‘Why’ message doesn’t even explicitly mention women’s clothing. Yet it still inherently strikes you as way more interesting. Why is that? Well, it plays into emotion and empathy, which are the two most powerful drivers in human decision-making.
Empathy, Emotion and Purpose
As the saying goes, “People will forget what you said. People will forget what you did. But people will never forget how you made them feel.”
Purpose and meaning are now more important to consumers than ever before. We know this because “89% of consumers say that, given similar price and quality, they would switch brands to one that supports a cause over one that doesn’t,” (Edelman, ‘5 Year Good Purpose Study’). But I also think it’s because people are no longer satisfied with massive corporate entities that are hyper-focused on profit, quarterly reports and big bonuses.
Old societal norms are breaking down, as new belief systems bubble to the surface and break through the veneer.
Ultimately, Sinek’s message is so important for entrepreneurs. If you’re young and starting your first company, you have the potential to get things right from the very start. Don’t underestimate how important this is!
Find out your ‘Why’ now. Trust me, it’s way easier to do if you have three employees than three thousand. Not to mention, you can embed your ‘Why’ into company culture from the very start. This acts as a compass to guide you through uncharted waters and serves as a focal point to return to if your business begins to drift.
So to market your products, services or company vision, make sure you ‘Start With Why’ and align yourself with a specific purpose. Hone in on something personalized and powerful.
At 28 & Under, our purpose is simple. We want to make the world a better place for young entrepreneurs. This means inspiring you to follow your dreams, achieve your goals and “Do What You Love.”
We wish you all the best of luck.