The Importance of Your Business Purpose Statement
Most business owners are aware that they need a mission and vision statement, usually posted to their website.
However, there is one piece of information that you absolutely need to have first. It’s called a business purpose statement.
Simply put, the purpose statement makes your existence crystal clear. It’s the why of WHY you exist and WHY a customer would want to interact with you.
Think about going on a journey. You don’t just start off without knowing why you are leaving! Sure, it’s important to know where you are going and how you will get there. But understanding why you are beginning this journey may affect every decision you make along the way.
And it is the same with your business. You need to know the basic reason for why your company exists before you can even begin to think about how it will go about its business.
Having a purpose statement sets the stage for you to create a vision statement (the “what”) and mission statement (the “how”) .
What is the purpose statement used for?
As a small business owner, you most likely have a very clear idea of why you started your company. But you may not have made that purpose clear to your customers and your own employees.
An article from Indeed suggests that a purpose statement can be used to:
- Increase motivation: When everyone in your company is on the same page, they know where they fit in the organization and how they can help the company thrive.
- Distinguish from the competition: When your purpose is very clear, it’s reflected in your engagement with your customers. Your business will stand out, drawing customers in with your strong identity.
- Meet goals: If your employees know the direction your company is going, it will be easier to set and meet manageable goals,
- Establish employee loyalty: An often-overlooked reason for having a clear purpose is that when your goals are clear, your employees feel good about the work they are doing.
Finding your process for elaborating on your purpose
Getting started on writing your own purpose statement isn’t difficult. But it does require some time and thought about all the factors that go into one.
Here are some things to think about as you are working on your purpose statement:
- What’s your brand story? What story would you tell people about how your business got started? Was it a hobby that turned into a business? Or maybe it was an unmet need that you saw an opportunity to jump into. No matter what it is, your story is YOUR story. It is important for you to know it and tell it to the world. Remember, your brand may be the most valuable thing about your business, so be aware of it and develop it along with your business.
- What was your motivation? It may be simple or it may be a long story, but understanding the motivation behind your small business is key. You may even want to attach some descriptive words to your motivation, like community or sustainability. Words that describe your reason for starting the business will resonate in many other marketing efforts down the road.
- How do you empower your customer? This is where the kernel of truth is for your purpose! Why do you do what you do to attract customers to your business? Try to make this statement clear, simple and fairly short. It will serve you, your employees and your customers best if you can describe the way you empower your customer without referring to notes or looking it up on your iPhone!
According to one study, 8 out of 10 Americans said they felt a deeper connection to companies with values that they shared. And when that company did a good job of conveying their purpose, 88 percent said they were more likely to buy products and services from that company. Clearly, many successful companies know that having a business purpose statement is good for the bottom line.
Feedback and change aren’t all bad!
Ask for feedback from your key stakeholders and your employees. Getting feedback is especially important, from your team. After all, they are the people who will help you carry out your organizational purpose!
And based on that feedback and the fullness of time, you may even change your purpose statement. That’s ok, as long as it’s a relevant change. In fact, it’s probably a necessity as your customers and technology evolve.
Think about Netflix, virtually a household name. The company started out as a distributor of content digitally but has evolved into a producer of original content that could win Emmys and Oscars. Or consider Dell, which started out as a maker of PCs back in the mid 80s. Today, of course, Dell has expanded into storage and servers, data protection and networking, along with its hardware products.
The purpose of these companies (and many others) has changed over time. Yet they have continued to grow and increase their profits as they recognize their new business purpose.
At Tomato FIsh, we strongly believe in defining your purpose as one of the first steps on your marketing journey. We invite you to take our short, free quiz that will give you an immediate score on the four key foundational elements that should make up your strategy.
You’ll get your score immediately and then book a free call with us to learn more about what your score means. We will start you on the right road to a stronger marketing foundation.
Tomato Fish Is An Indianapolis Consulting Company Focused On Helping Small And Midsize Businesses Make Good Strategic Planning Decisions.