If I said these two words to you as a two ways to grow your business, which is the most important to you?
You may think “profit” is the most important, right? But profits are a by-product of your purpose and showing your customers why you exist for them.
How are you impacting their lives? If we focus on our customers’ needs, better profitability will be a by-product.
The question you really have to ask yourself and understand is:
Why does your business exist?
Why is your purpose important?
Your purpose is roughly three to seven words explaining why your business exists for your customers. Your purpose should be about THEM, not you. It is a small statement, with immense power.
Tesla: To accelerate the world’s transition to sustainable energy.
Walt Disney: To make people happy.
TED: Spread ideas.
These may be big-company examples, but a clear purpose statement is just as important for small and medium-sized business.
A defined purpose statement is the antidote to a hugely profitable business… because we know that consumers are wired to take a self-interest and therefore will engage your business if your why resonates with them. Thereafter, your purpose will drive alignment of values and loyalty.
If you don’t focus on purpose, you’re likely to focus on profit
Guess what? Your customers aren’t interested in you making a profit. They’re too worried about their own profit. They’re more than happy for you to make a profit… provided you meet their needs first.
Let me give you a real-life example. One of our customers was on the hunt for a new car. It was the end of the month and during the negotiation stage, the salesman and business owner said: “We can do it for this price but I need the money in my account tomorrow. That’s the end of the month and it will look better for my figures.”
Do you think she bought the car? No. Why? Because she didn’t feel appreciated, she was just another sale to the business owner, not a valued customer.
The correlation between a business’s ability to serve a higher purpose and stronger financial performance has been proven. So, defining your purpose is a smart business strategy.
It comes down to engagement; with your team and your customers
Numerous studies have told us that a strong sense of purpose drives employee satisfaction, which will help to improve customer loyalty.
Articulating your business’s purpose to your team allows them to see that they are contributing to something bigger than themselves. Linking your purpose to their tasks and responsibilities allows them to see their connection to the outcome; how their role is attributing to the overall vision of the business – how they are impacting your customers’ lives.
If you focus on meeting (and exceeding) your customers’ needs, better profitability will be a by-product.
It’s essentially internal marketing; to achieve buy in and alignment from the team; providing motivation to deliver on your purpose whilst breeding loyalty.
Getting clear on your purpose will also transform your other marketing. Being able to clearly articulate why you exist for your customers in your marketing will tie customers to your brand and make them more inclined to refer you to others.
When that new customer does their due diligence, that is, they stalk your website and social media, it’s more likely they’ll develop an emotional connection to your business and buy from you.
Your purpose must first be defined by the leaders
Only when your purpose is crystal clear can you articulate to your team and then your customers and target audience.
Having a clear purpose is also about sustainability. There is mounting evidence that in these times of change and disruption, having a clear purpose will improve a business’s ability to transform and adapt.