The Secret to Creating Impactful Company Values in 2020
If you’re the owner of a small business or startup, one of your biggest hurdles is creating a meaningful company value statement, and for a good reason. Connecting early on with customers is a huge predictor of long term success.
But good company values aren’t what you’d expect. Let me explain.
For years, I worked on political campaigns. And when you think about it, campaigns and startups have a lot in common.
For example, when you’re a candidate running for office, the first thing you’d do is commission a survey of your target voters.
As a political candidate, you may have top issues you feel strongly about, but the majority of voters may not share your views. It’s not until you survey the voters that you’ll know for sure, and sometimes what you’ll find may come as a surprise. Once you know your target audience’s top concerns, you line those up with your solutions, and that becomes the focus of your campaign.
Similarly, when you think about your startup values, you want those to reflect your target audience’s values. Going off into the weeds or being uneducated about what they care about can turn customers off. This isn’t about being fake; it’s about aligning with your customers through your shared values in a way that resonates with them. Your company values should feel authentic to the customer, and there are a couple of reasons why.
Why Customer Values Are So Important
People’s Buying Habits Are Driven by Value
The number one reason why values are so important is that values are the driving force behind all human decisions. Understanding your customer’s values means knowing what they hold dear, the standards that guide them, what creates meaning for them, and the lines they will not cross.
People expect that the companies they support share their same values. In fact, according to a study involving more than 2,000 participants, people feel a stronger affiliation with companies that share their beliefs. Approximately 6 in 10 customers surveyed stated that they look closely at a company’s values before buying a product.
A lot of companies have already started leveraging their values in their marketing. You may have noticed labels on food products like Fair Trade and Locally Made. Customers choose these products over cheaper alternatives because the products support causes they believe in, which brings up another point. Sharing your customers’ values enables you to charge a premium for your products and services.
People’s Buying Habits Are About Themselves–Not You
Conventional value statements miss the mark for another big reason: buying decisions are based on a person’s needs and wants. People care about your business only to the extent that you can fulfill their desires.
Purchases people make are emotionally driven and then justified rationally later. Research has a name for this phenomenon. Post-hoc rationalization can be found whenever we make decisions, from dating to hiring and everything in-between. We lead with emotions first, and then we justify our decisions later.
What does this mean for your startup? Well, you’re in the best possible position to make early emotional connections with your customers. Once customers have decided they prefer a particular option, post-hoc rationalization makes it difficult for them to backpedal. The sooner you can make emotional connections with your customer, the better off you’ll be. And the best place to start is through your values statement.
Secondly, customers who feel connected to your company are more valuable than those who are just satisfied. They spend twice as much as satisfied customers and have a 306 percent higher lifetime value.
Emotionally connected consumers stay with a brand two years longer and recommend brands at much higher rates (30.2 percent vs. 7.6 percent). Knowing your customer’s value is key to earning their loyalty and longevity.
People Want to Buy From Businesses That Align With Their Ideal Self
Another reason why you should market around customer values instead of company values is people’s self-perception.
Values speak to who we want to be and how we want others to see us.
You should always market to your customer’s ideal self instead of their actual self. When companies connect with a person’s ideal image, the pay-off can be huge.
Take, for example, Patagonia’s values statement:
Our Reason for Being: Build the best product, cause no unnecessary harm, use
business to inspire and implement solutions to the environmental crisis.
People don’t buy into Patagonia because they like that Patagonia “implements solutions to the environmental crisis.” People buy Patagonia because they want to be seen as one of those environmental change-makers. The values statement speaks to their ideal selves.
The gap between the real and imagined self can create a strong motivation to buy products. A recent study from The University of Texas found that “consumers feel better about themselves when they purchase products or services that they subconsciously link to aspects of their self-identity about which they feel insecure.” Your company must speak to your customer’s feelings about who they want to be.
Customers’ self-perception is why companies spend millions on celebrity endorsements. People want to align themselves with what and who they consider successful and attractive. Almost every smoker wanted to be the Marlboro Man. At the end of the day, you need to learn how to inspire feelings within your customers. And a values statement that aligns with their ideal self is the quickest way to do it.
The Secret Is About Giving the Customers What They Want
In case you haven’t figured it out by now, your start-up’s values should be your customers’ values, not yours. Customers want to align with companies that value the same things they do, fulfill their needs and improve their self image. Most consumer decisions are emotionally driven. You must first listen to the customer and what they want before deciding how to market to them. Companies that want to win cannot afford to play by ear.
What if I already have a values statement?
After reading this, you may realize there is a disconnect between what you thought your customers cared about and what they actually want. The first step is research.
Finding out why they’re using your product can influence your marketing going forward and bring better returns. Your buyer personas may need some adjusting. My stint in politics has taught me the effectiveness of surveys. Bottom line: ask your customer what they care about first.