Sell the hole, not the drill.
BackstoryWhen I was the Manager of Financial Planning and Analysis at Black & Decker (BDK), the Marketing Department taught me an important lesson: People do not buy quarter-inch drills, they buy quarter-inch holes. What they meant by this is that a hole is the benefit that a drill provides, and therefore Marketing should focus on the end result rather than the product.
The six-word phrase “Sell the hole, not the drill” is a common one in the business world. People do not necessarily want another product, but they do want what the product can do for them. From this perspective, a customer does not buy a thing but instead buys the satisfaction of a need. The phrase implies that a company should not focus on what it is selling, but rather on how what they are selling leads to an outcome that is desirable to a buyer. The bottom line is that if you can successfully sell the hole, then you will have more customers and more profit.
Long after I left, during 2010 BDK sold itself to the hand tool company The Stanley Works Corporation. BDK sold itself at a stock price that was toward the lower end of its trading range. I was disappointed by this decision and felt that it was not in the best interests of the shareholders. I wished instead that BDK had remained an independent company. The 100-year-old brand name is now tucked behind the Stanley name, and the conglomerate is called Stanley Black & Decker. In my view, a corporation such as BDK should have been the buyer, not the seller.
If I had still been working at BDK, then my six words of business advice to the decision-makers would have been, “Sell drills, not the whole company.”