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Golden Circle: What, How, and Why

Updated: Oct 3, 2023

In the ever-evolving ecosystem of brands and consumers, Grapdes plays a unique role in helping brands of various industries define their brand stories and purposes. Thus, defining the core purpose of the brand becomes extremely crucial before moving forward in the brand journey. Customers too often view the brands they closely indulge in as an extension of themselves, thus making it more relevant for marketers and brands to coin their function.


The core to any brand’s positioning starts from wondering about its What, How, and Why? which makes up the Golden Circle of marketing. Before we move into the importance of the golden circle, it's essential to understand the significance of coining the three rings within the circle.


‘What’ is generally a brand’s product offering or service. ‘What is it that your brand is bringing to the market?'


The ‘How’ talks about ‘How your brand differs from its competitors, basically its Unique Selling Proposition, internal and external.'


Lastly, the Why.
Unlike the other two, the Why is often overseen and crucially underrated.

Customers don't merely buy into the product/service your brand is going to offer but the purpose, cause, belief, and reason your brand stands for. Legendary brands that have become a part of our daily consumer journey have managed to remain market leaders specifically by coining and practising their ideologies.


Let’s take Nike for example, their philosophy has been ‘to make you move’ to push you beyond your hindrances, insecurities, and thoughts. One cannot think of the phrase ‘just do it’ without invoking the brand’s core purpose and the same is quite fitting for a fitness brand.


How does a customer buy?


For the ease of better understanding, let's break down a customer’s buying journey and then go on to identify where a brand’s philosophy/ vision plays a role


Awareness

This is the initial stage at which a potential customer comes across a brand for the first time. The source of this can be simply word of mouth or advertisements.


Consideration

At this stage, the consumer is solution aware. They know that a particular product is what they are seeking but will go on to ponder about the provider of the said product/service.


Decision/Purchase

After careful consideration, the consumer has decided at this stage. Whether or not to make the said purchase, by a given provider/brand.


Retention

At the retention stage, the consumer is a regular customer, this goes to denote that the brand still holds the consumer’s interest and loyalty.


Advocacy

Advocacy is the most ideal stage every brand wants its consumer to be at. When the consumers themselves become testimonies to the brand and its offerings.


Customer buying journey stages - icons representing: awareness, consideration, decision, retention, and advocacy.

Across the stages mentioned above, understanding the philosophy of a given brand is a subliminal factor affecting each stage. Starting from awareness, if the source of awareness is word of mouth, there is an added factor of trust by the former user which automatically leads to consideration. Advocacy is the defining stage for any brand’s cycle where the customers become influencers, they relate with the brand’s personality and their own and how they want to be identified.


What a brand stands for, the actions and issues it's identifying & engaging with, the messaging it's doing and especially how it appeals to a buyer are some answers the consumers are indirectly conscious of.


Why start with 'Why'?


“People don't buy what you do, they buy why you do it”

The golden circle was introduced by Simon Sinek in the year 2009 through a TED Talk on How Great Leaders Inspire Action. The concept explains how the ‘why’ communicates to buyers on not just the consumer psychology level but at a biological level by sparking the limbic part of one’s brain that helps in decision making, feelings of trust, loyalty, and gut feelings. This allows us as consumers to notice emotional messaging associated with a certain brand which is most likely to influence our purchase/decision.


The easiest way for a brand to communicate to an individual is by expressing its personality. This process begins from defining a brand’s strategy to using branding to express the coined persona. The design scheme uses the tone of voice, and the messaging plays an important role in communicating the value proposition of the brand.


The ultimate aim is to stand out in the market and among the competitors by creating a strong foundation that helps consumers associate the brand with a set of brand attributes, benefits, impressions, and emotions; emotional and physical offerings.


Talking about the core of the brand also helps in carving out the niche of your customer segmentation. These customers are typically those who stand for the same beliefs as your brand and relate to your brand's vision and mission. If we have to be accurate, customers who fall under the categories of Innovators, Thinkers, Achievers, and Experiencers are those who will make up the niche of any customer segmentation. Capturing them will automatically allow the rest of the majority to follow.


Identifying the right customer audience also helps greatly with digital marketing, giving great insights into strategic positioning and targeting of campaigns to consumers based on their engagement of content as a basic example.


Let’s discuss some brands


Let’s talk about one of the super-brands; Apple. Apple’s cause has been to ‘challenge the status quo'. They’ve made products user-friendly by making them simpler yet challenging mediocrity, with unconventional thinking and continuous innovation for the customers alone.


Apple was one among the first to talk to The misfits. The rebels. The troublemakers. The round pegs in the square holes. The ones who see things differently. They’re not fond of rules.

And why exactly did Apple choose to talk about the misfits? If we analyse closely, they also spoke to the ‘misfits’. To target those, who didn't identify as the regular Joes, to those whom the regular solution-oriented brands could never get to, thus creating a heightened sense of aspiration, altering self-image and moving on to being a symbol of status quo in the society.


Nike: Another iconic brand that has surpassed its industry to act as a motivational reference for anyone and everyone across the world. Their cause has been ‘that action is rewarded. The brand has fearlessly always stood by its cause not just in selective discourses but also via its many path-breaking campaigns that were subjected to some backlash.


Nike like other activewear brands could have communicated just about the benefits of their activewear, how it helps one workout better, hassle-free. But they recognised a deeper issue: unmotivated individuals and the brand needed to communicate to them, one that spoke to the hardcore athletes as well as those thinking of taking up a morning walk.

Now that we’ve invoked some of the super brands, we want to talk about some of the super brands we are working with!


Inali Foundation, established with the ideology of challenging disabilities by enabling lives, is a non-profit organization helping provide prosthetic upper limbs for amputees who have lost their limbs in various accidents. Over the last 5 years, the foundation has distributed almost 6k+ limbs with this just being the beginning of many initiatives like ‘Limbs on wheels’ and ‘Pukaar’ being their flagship events to reach out to amputees in remote areas.


The brand believes in ‘challenging disabilities’ and the stigmas associated with them, unlike other non-profit organizations, Inali Foundation aims to be a beacon of hope for amputees and looks forwards to fighting for disabilities in every sense possible.


Fuelflip Energy is an impact technology startup, aiming to reduce the harsh environmental effects of pollutants usually released by using diesel generators across various industries and residential areas. Fuelflip’s Duel Fueling Kits help in curbing greenhouse gas emissions by providing alternative sustainable solutions that are economical and environmentally viable.


Fuelflip Energy believes in flipping the fuel usage pattern for a better future, by providing smart solutions. Aware of the rising CO2 levels in the environment, the brand is actively raising awareness about various environmental issues and how it is playing a role in countering the same.


Text: WHY of the brands. Examples of brands with their beliefs: Apple, Nike, Fuelflip, and Inali Foundation.

Is the power of branding a myth?


Let's go a little beyond the power of branding and explore if the purchase decision is solely based on branding and communicating the core of the brand. If we were to explore the ‘why’ of any and every brand, we are inevitably reminded of the need to make profits, to survive in a growing and competitive market.

Surely talking about the same as the core purpose of a brand will be futile, brands often associate themselves with an emotional cause that’s relatable and problem-solving. The core reason behind the same is to tap into the customer’s emotional psyche, enhanced perceived value offering of the brand thus contributing to the brand retention, recall and messaging in the market.


But is that all that's required? Is that enough for a brand to reach its ideal target consumer? Not really. It's also important to invoke the ‘how’ of the brand. How talks more about the values, behaviors, and principles that differentiate brand A from brand B, and guides behavior and decision-making across the company.


Final thoughts


While there is no set rule as to what works for a brand’s success; every brand's communication will answer all the aspects of the golden circle, and it is also crucial to do so for clarity of information. Brands can often employ different permutations and combinations of talking about the what, how, and why that's befitting the respective brand and its strategic objectives.


However, brands failing to talk about the why often end up fading out of the market in the system of other brands constantly restating their core purposes and visions, thus innovating themselves to stay relevant and updated along with their new customers.


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