What business are you really in?

Written on 30 January, 2014 by Jonathan Crossfield
Categories: Small Business | Tags: customer behaviour

Customers don’t buy products.

You read that right. Before you click away thinking I’ve finally given up on life and gone ga-ga, think about it for a moment. Customers don’t buy products – they buy the means of achieving a personal goal. That means your business isn’t really the product you are selling, but the goal others are achieving.

I don’t buy a DVD because I want another shiny disc in a plastic case to clutter my shelf. I buy it because my goal is to see the film it contains. I don’t buy a new shirt because it’s a shirt. I buy it because I have a need of a shirt to cover my nakedness.

So why do so many businesses and salesmen continually sell products and not the solutions to a goal?

Not sure what I mean? Let’s take an example. Telstra’s product is primarily cabling linking your house to a network plus the devices people can use to access these cables. But if Telstra launched a marketing campaign describing copper cable, you wouldn’t be too impressed. Telstra is not in the business of selling copper cable. It’s not in the business of selling telephones, or bandwidth, or even connections.

Telstra sells the ability for its users to communicate. My goal is to be able to access information and talk to people when I need to. I don’t care about cables. I’m not even that fussed about the handset (although some people can be). I don’t need to know how these things work and have no interest in the process of getting them under the pavement into the house.

It is because Telstra understands the difference between product and goal that the marketing focusses on people communicating. Consider the Telstra BigPond commercials – the father and son solving their ignorance by accessing the internet. We don’t see the cables. We don’t learn about how data is transferred. In some of the adverts, we don’t even see a computer! The goal is clearly answered – or rather, as in some of them, the risk of not answering that goal (your child believing the Great Wall of China was built by Emperor Nasi Goring to keep out rabbits). And BigPond is put forward as the solution. It was a hugely successful campaign, but never once describes the product except in passing.

A DVD advert doesn’t describe the materials used to make the disc – it shows clips from the film. A shirt commercial doesn’t give me a history of shirt-making to better understand why we have buttons on the left or right – it shows how someone like me would look wearing it.

Apply the same thinking to your own business. What goal are your customers meeting by buying your product? That’s the real business you are in.