A trait common to all recent generational groupings — Gen X, Gen Y and Gen Millennium — is that they tend to have a different view of the world when it comes to buying a product, joining a club or joining an organisation.
They tend to be as concerned about why a company or organisation exists and what its reason for being is, as they are about the quality or cost of the product or service being offered. Quality and value is seen as a given, not the main driver to buy.
Motivator Simon Sinek cites Apple as an example of a company which started off by asking “why” it existed before then moving on to “how” to achieve this end, followed finally by “what” its products would do and what they would look like.
Apple grew their products from the inside out, starting with a core concept of why, which then influenced how the product was developed and what the products could do.
With companies that start by deciding first what they intend making, their reason for being in business can often be overlooked, or influenced too strongly by the product or service they are selling.
Apple sells a lifestyle, an attitude — recognising the power of connecting with people who live a certain way and want to incorporate a like-minded company’s products into their lives.
The company’s products still have to be good, but Apple recognised the power of not directly selling their products but rather aiming to produce and market products which reflect a certain way of life.
As well as picking up on current trends — for example, downloading of individual songs, and touch screen operation — they ensured that right from the start their products had a certain look. Sleek, simple and white.
I recall the story of a media company deciding that PCs coupled with Microsoft software was the best answer to their business needs, but then housed them in Mac casings to ensure they appealed aesthetically to their staff demographic.
It also showed clients they were a switched on and modern organisation prepared to embrace the new.
Apple products are generally more expensive than their direct competitors, and not always the best in terms of reliability or features. However, they sell to a family of loyal customers. Just check out the queues to even get into any of the large Apple stores, while also noting how much alike the potential customers are, in appearance and age.
As long as it’s red
Another extreme example of a company which focuses on selling a lifestyle as much as a product is Ferrari.
Ferrari customers, as well as being prepared to wait months for their new car to be customised, are prepared to pay an extra price premium if it is painted Ferrari Red.
Painting it red didn’t cost the company any more, but they realised that a red Ferrari represented the ethos of Ferrari better than a car painted any other colour. Perception in this case was reality. It recognised that cost and value are different when purchasing a product that has a special character or status.
If you offer such a purchaser more than just a product, if you make them feel special, or a member of a group of like minded individuals, then cost is no longer the core consideration.
Price, quality, features and service remain important, but if a company or organisation is looking for long-term loyalty from its customers it needs to offer more. They need to make their customers feel they belong, that they are important.
Asking why first
For today’s younger generations, this is becoming even more important. As well as being able to readily access information on products and services to compare before they buy, they are also more likely to share their thoughts and concerns with others in their peer group.
Whereas once this might have been more about ensuring they only purchased the most trendy or up-to-date product, today they are just as concerned about taking advantage of group knowledge.
They want to ensure, by talking among their peers, that their views and attitudes are reflected in the products and services they buy.
Architect Don Bunting notes that recent generations are much more likely to ask “why” before deciding on a product or service.
For those of us operating in the construction sector, we need to be aware that society is changing. Today’s customers have a different view of the world, with as much concern about a company’s philosophy as about the quality of its products and services.
Concerns about the environment reflect a similar attitude. “Generation why” will be less influenced by arguments that green energy might cost more, against the need to preserve dwindling natural resources or reducing pollution. They also believe that being green reflects their approach to life in a broader sense.
Consider starting up a new construction company. By starting with what you intend to build you will end up competing with all other similar companies, entirely or mainly based on price alone.
If, however, you start from the basis of “I am in business because I want to design and build houses that people will love”, your chances of success will be higher. Then move on to how you will achieve this — by employing the very best designers, builders, materials and tradespeople.
Finally ensure that what you build suits the market demographic you are aiming for. If that approach doesn’t succeed then maybe you’re in the wrong business.