The Golden Circle theory is a concept that has gained significant attention in both leadership and marketing. It was popularized by Simon Sinek and focuses on how companies can communicate more effectively and create loyalty by starting with the right question: Why?
Let’s take a closer look at what Golden Circle is, why it is relevant for businesses today, and how the theory can be actively applied in marketing and leadership.
What is Golden Circle?
The Golden Circle is a simple but powerful concept consisting of three layers: Why, How and What.
- Why: This is the core of the theory. It is about the purpose, reason, or belief behind the company. Why does the company exist? Why does it do what it does?
- How: This layer focuses on the process, method, or way the company realizes its purpose. What unique methods, strategies, or values does the company use to achieve its why?
- What: This is the most concrete layer and focuses on what the company actually offers – products, services, or solutions.
Why is Golden Circle important?
The Golden Circle theory is not just an abstract leadership idea – it has strong relevance for marketing and communication. By starting with why, companies can:
- Create emotional connection: Customers often engage more with companies they feel share their values. Communicating purpose first appeals to emotions rather than just logic.
- Differentiate in the market: In a competitive market, companies that clearly show their why stand out from those that only present products and prices.
- Internal engagement: Employees who understand the company’s purpose are often more motivated, loyal, and creative.
This means Golden Circle is not only a branding tool but also a tool for strategic leadership and organizational development.
How can companies apply Golden Circle?
Implementing Golden Circle in practice requires reflection and structure. Companies can follow these steps:
1. Identify your why
The first step is defining the company’s core purpose. This is not about profit or specific products, but about why the company exists.
Example: Apple starts with Why – to challenge the status quo and think differently – before presenting its products.
2. Map your hows
Once the purpose is clear, identify how the company realizes this purpose. Which values, processes, or strategies support the why?
Example: Apple’s how could be their focus on design, usability, and innovation.
3. Describe your whats
Finally, move to the concrete layer: What does the company offer? These are the products or services that customers can purchase.
Example: iPhone, MacBook, iPad – all products that exemplify Apple’s why and how.
By following this order, communication becomes more inspiring and gives customers a reason to choose your brand, not just based on features or price.
Golden Circle and marketing
When applied to marketing, the theory changes how companies convey their messages. Traditional marketing often focuses on what – product features, prices, and campaigns. Golden Circle adds an extra layer: purpose and values.
For example, a campaign that starts with why appeals to the audience’s emotions and values. A company selling sustainable t-shirts can communicate:
- Why: “We believe in a world without unnecessary waste and pollution.”
- How: “We only use recycled materials and ethical production.”
- What: “Our t-shirts are soft, durable, and environmentally friendly.”
This approach builds loyalty because customers identify with the why, not just the what.
Typical applications of Golden Circle
The Golden Circle theory can be applied in many different contexts, both internally within the organization and externally to customers.
In branding, the theory helps companies create a stronger and more recognizable identity by communicating purpose and values first, before introducing products.
When it comes to product launches, Golden Circle can be used to present new products in a way where the company’s why clearly explains the background and meaning behind the innovation.
The theory is also highly relevant for leadership, as employees who understand the company’s core values and purpose often become more engaged and motivated.
Finally, Golden Circle can strengthen communication in general, for example in campaigns, social media posts, and advertisements, where the message starts with purpose rather than just function.
Benefits of working with Golden Circle
Working with Golden Circle provides several tangible benefits. First and foremost, it creates a clear purpose, which makes decision-making more strategic and goal-oriented, as all activities are based on the company’s why.
Additionally, customers can more easily feel an emotional connection to the company because communication appeals to values and beliefs rather than only highlighting features or prices.
Internally, Golden Circle strengthens collaboration and understanding among employees, who act more in line with the company’s purpose, often resulting in increased engagement and smoother workflow.
Overall, it also contributes to long-term customer loyalty, as brands that consistently communicate their purpose build stronger relationships with their target audience.
Note: If a company’s why appears superficial or inauthentic, customers will quickly notice, which can damage credibility.
Golden Circle in practice
Patagonia, the well-known outdoor brand, is an excellent example of how Golden Circle can be applied in practice.
The brand has a clear why: to protect the environment.
This purpose permeates everything they do – from their how, using recycled materials and supporting environmental organizations, to their what, which consists of jackets, t-shirts, and outdoor gear.
But it does not stop at the products – Patagonia also uses storytelling as a tool to communicate their purpose.
In their campaigns and on social media, they do not just show what they sell but why the products exist: how each jacket or t-shirt contributes to sustainability and what values the brand stands for.
This approach allows customers to understand and identify with the brand’s mission, creating a deeper emotional connection.
Stories start with why, highlight how, and end with what, making communication both engaging and authentic.
The result is that customers not only buy products but become loyal ambassadors, sharing and supporting Patagonia’s values because they understand the meaning behind everything the brand does.
Implementing Golden Circle in digital strategies
In digital marketing, Golden Circle can be implemented in multiple ways:
- Social media: Start posts with purpose instead of product details.
- Email marketing: Tell customers why you are sending campaigns and how it reflects the brand’s values.
- Website: Dedicate sections to the company’s mission and vision before showing products.
- Content marketing: Create articles, videos, and guides that clearly communicate why before introducing concrete solutions.
Future relevance of Golden Circle
In a world where consumers are increasingly critical of commercial messages, Golden Circle becomes even more relevant. Customers increasingly seek companies they can identify with and that have a clear purpose beyond profit.
Companies that consistently communicate their why will not only differentiate themselves but also build long-term relationships, increase loyalty, and create brand ambassadors.
A philosophy for effective communication
Golden Circle is more than just a leadership or marketing model – it is a philosophy for how companies can communicate more effectively and build deeper connections with both customers and employees.
When working with Golden Circle, start with why, reflect on how, and only then present what. This creates internal clarity as well as external authenticity and engagement.
Companies like Apple and Patagonia show that it can be a gamechanger when theory is translated into practice. In a digital age where storytelling, content marketing, and social media are more important than ever, Golden Circle provides clear guidance on how brands can stand out and inspire.
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