What Can Clean Growth Entrepreneurs Learn From the Story of Northvolt?
Lithium-ion battery manufacturer Northvolt is currently valued at €1.6 billion, making it one of Europe’s highest profile Clean growth unicorns.
What was the story that two former Tesla executives told to secure funding from the European Investment Bank, IKEA Group and Goldman Sachs?
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Northvolt really understands the common mindset of its target customers, whether they come from the Automotive, Grid, Industrial or Portable and Micromobility market.
It knows that the people who will champion its technology self-identify as ‘change-makers’ within their chosen industry; who have strong beliefs about a low-carbon future but have to make the ‘real-world’ business case for change.
Their marketing, such as this video, is relentlessly targeted on these Heroes, knowing that they will be the ‘champion buyers’ who will push for the adoption of their products and help them navigate the decision-makers within a business.
Priming is an effect, demonstrated by psychological research, where our decisions are often hugely affected by context. Northvolt knows that the change-makers who make up its target audience are frustrated by needing to fight for change within a business.
It primes this audience to support them, by playing this frustration back to them (the video above is a great example of this).
“Change won’t listen until new is better on every level” boils the general frustration of having to fight for change down to a particular mindset that stands in their audiences way – a mindset that is risk-averse, cost-focussed and emotionless.
Using a mindset as a villain can be powerful for three reasons:
It is often instantly recognisable to the target audience because they run into it regularly – making them feel like you really understand them.
It creates a strong sense of which side they want to be on – even if they sometimes exhibit this mindset themselves most people don’t want to recognise negative aspects of their own character. They instantly want to be on your side!
It primes the idea that you’re going to be the ones that help them overcome this mindset, which pervades their business or industry – making you seem scarce, which is very attractive.
Call To Adventure:
Northvolt’s Call To Adventure is effective because it juxtaposes some of the barriers to adoption (better performance and scale), with the Better World that motivates this change-maker audience:
High-quality green batteries in industrial quantities can enable the future of energy.
Crossing The Threshold:
Building on the frustrations of the Ordinary World; Northvolt’s language around ‘flick the switch to transition in your business’ both acknowledges the struggles change-makers face while implying that with them these can be easily overcome.
The three challenges for the customers of any business, tend to be trying the change, making the change work and living the change.
For Northvolt’s change-makers these are:
- Do Northvolt batteries offer better performance than we have currently?
- Can Northvolt batteries fit into the specifications and scale of our business?
- Are Northvolt batteries competitive on cost?
These are directly addressed by Northvolt’s key messages about the Gifts it provides as a Mentor.
Mentor & Gifts:
As we’ve already mentioned, people want things more when they feel scarce. One way to make your company feel scarce is to have a unique viewpoint on the Hero’s problem that can move a market, change a category or challenge the status quo.
For Northvolt this is ‘Next-generation lithium-ion battery manufacturing’. This is also a classic ‘building on the category’ positioning – where companies find or create labels for their technology that suggest a game-changing improvement on what has been done before.
People will only come on a journey of change with you if they trust you and like you. Northvolt uses the fact that its founders, Peter Carlsson and Paolo Cerruti, headed up supply chain operations at Tesla to build credibility and demonstrate that like the change-makers they’ve battled with battery supply chain issues.
You might not be a former Tesla executive, but do you have relevant experience that will project credibility and similarity to your audience?
The three gifts that a Mentor offers have to align with the 3 Challenges that customers will face.
This is done through Northvolt’s key messages about what developing the world’s greenest battery cell and establishing one of Europe’s largest battery factories Northvolt can provide:
- High-performance Energy, Power and Life cells.
- Customer tailored battery cells, modular components and complete scalable battery systems, at an industrial scale.
- Scale, automation and vertical integration (owning many elements of our value chain) means Northvolt batteries are extremely competitive on cost.
Allies & Gifts:
When they’re uncertain, people will look to the actions and behaviours of others to determine their own.
Northvolt uses its list of partners such as BMW Group, Scania, and Siemens to reinforce trust in its Gifts as a Mentor.
Northvolt won’t have had all of these on-board when it started out – but make sure you emphasise the credibility your existing partners to help you secure future customers. We see so many investor presentations that throw away this slide, by not fully leveraging them to create trust in your company.
Finally, to go on a journey of change the destination has to be worth the journey.
To paint a picture about how buying a product or service can improve a customer’s life, companies focus on showing how it will help people ‘get ahead’, ‘get along’ and ‘get meaning’.
- Get ahead – advancing our status in our tribe(s}.
- Get along – advancing our connections within our tribe(s].
- Get meaning – advancing our purpose in life (or at least for this chapter in our life). This last one doesn’t have to be world-changing – depending on your personality, your purpose can be equally rewarding whether it benefits one other person or the whole world.
Northvolt paints an effective picture of the future for its change-maker potential customers:
- Get ahead – High-performance lithium-ion batteries at a competitive cost.
- Get along – Recognition as a change-maker from others in their business and beyond.
- Get meaning – Enabling the transition to the sustainable future they imagined.
Show this Better World to your customers. If you only hope they’ll figure out how your solution will make their lives better, you’re leaving an important part of your story to chance.