Why business success comes from offering a promise, not a product

“My favourite example for Virgin [Group] was when Sir Richard Branson launched double beds on Virgin Atlantic… And a journalist said to Sir Richard Branson: ‘This is a brilliant idea. How did you come up with this idea?’ And Sir Richard Branson said: ‘I didn’t come up with the mile-high club… I just decided to give consumers what they wanted.’”

Carl Bates, managing director of Sirdar Global Group

Carl Bates, managing director of Sirdar Global Group

This example was highlighted by Carl Bates during a Business Partners seminar in Cape Town, South Africa concerning the difference between product and promise in business. Bates, a New Zealand-born business speaker, mentor, author and global entrepreneur, is the founder and managing director of business advisory and solutions company Sirdar Global Group (and is also CE of the Sirdar South Africa Group).

During his presentation, Bates told business owners there is a fundamental difference between a business that delivers a product and a business that delivers a promise. His Virgin Atlantic example shows how Branson, founder of Virgin Group, focused his business strategy on delivering a promise to meet the needs of consumers, rather than on products.

“If you think business is about creating money you will never create the wealth you could otherwise create in business,” explained Bates, noting the irony in this statement. “If you understand that business is not about making money, it’s about delivering a promise, you will fundamentally change the game.”

He added that the role of an entrepreneur should be to undertake a promise to consumers and the role of the enterprise should be to hold that promise. “The most successful businesses on the planet understand the context of promise.”

The Disney World example

Another example of an enterprise that understands the importance of delivering a promise in business is Disney World, which Bates said holds the promise of creating magic. “The way Disney operates – in everything they do – demonstrates the use of their promise.”

For instance, the way Disney World disposes of its rubbish.

Bates highlighted that Disney World in Florida, the US has around 100,000 people walk through its gates and up its Main Street USA each day. “Could you imagine the amount of rubbish that would be put in rubbish bins up and down Main Street USA on any given day? Could you imagine a 20 ton truck driving up Main Street USA on the way to Cinderella Castle? It would break the magic. So what do they do? They empty every rubbish bin in Disney around the world from under the ground.”

According to Bates, when Disney World in Florida was hit by a hurricane in 2006, they managed to get up and running almost immediately. “The hurricane hit Disney World in Florida at 3pm one afternoon. At 9am the next morning Disney World in Florida opened without a single sign of damage to the average [visitor].”

This, explained Bates, is an example of how Disney sticks to its promise of creating magic for consumers, no matter what.

To highlight his point, Bates asked his audience if they had heard of Knott’s Berry Farm in California and only one person raised his hand. “It’s arguably a better theme park than Disney,” Bates said. “The critics say it’s a better theme park. I have been there – it’s a better theme park than Disney if you define a theme park by the specifications of the product.”

But, he added, in a room full of people who have heard about Disney World, only one person has heard about Knott’s Berry Farm. Bates said this was because the one delivers a product while the other delivers a promise. He recommended that every entrepreneur reads Creating Magic by Lee Cockerell.

“Disney is about the concept of promise. They understand that their business is about creating magic. The challenge for us as entrepreneurs, if we truly want to succeed, is to understand the difference between product and promise and choose the game we want to play,” he concluded.