The Value Proposition and Why You Need One
Successful companies create a link between what they do well and what their target audience want. Here’s how to create a ‘Value Proposition’.
Firstly, we need to go back to basics because if we agree that the ‘value proposition’ sits between the business strategy (what a business wants to do well) and delivering in an understandable way what the customer desires (brand strategy), then we need to understand what we mean by business strategy and brand strategy.
Now a great deal has been written about business strategy and having been round the block a few times, I think I’m right when I say that most so called experts get this wrong! You hear and read things like strategy is how resources should be allocated to achieve the mission. No, it isn’t! It’s true that you can’t develop a strategy without determining your goals which is what the ‘mission’ is all about, but strategy is more than that. I read an article recently that said business strategies are the choices made with specific targeted customers that allow you to grow your business effectively. No they aren’t!
A business strategy details the vision of the business which is different from the mission. The vision describes what the success of the business will look like by defining targets and customers etc. The strategy then goes on to describe ‘the how’ by determining your competitive advantage and communications channels. All successful businesses succeed by developing points of difference and competitive advantage; points of difference being how your customers perceive your competitive advantage.
How do you create a value proposition?
So, what about brand strategy…again another misunderstood term. Brand strategy is the method by which the character of your company will be recognised by the target audience to which you are trying to appeal.
Now the value proposition is the value the customer receives (experiences) after purchasing your products and services. It’s what makes them feel good and enables them to improve their business, or lives. Before we move on, we must agree that the value proposition is the way your product and service make your customers feel after they have purchased your product/service. In other words, it is not your product/service nor is it the competitive advantages your product/service possess.
So, how do you do it? Here are a few basic guidelines:
- In my opinion, the most effective way to create your value proposition is to use the language that your customers would use to describe your products and services. Speak how your target audience speaks. Copywriters and collateral generation in general often fall into the trap of trying to appear sophisticated, comprehensive, or overly technical with the hope of trying to impress the target audience. If you are not sure of the language and tone, do some research, send out questionnaires, or better still, go and speak with them directly; conferences, trade shows are good for this.
- Next, be clear about what you are trying to say. Again, copywriters often fall into the trap of using jargon and industry buzz words. That’s not good. Just tell them how buying your product/service will improve their situation. Tell them why they should buy from you and not your competitors. Clearly, you can’t knock the competition but through ‘ghost writing’ you can make them think about the choice they are going to make. Tell them what your product and service does together with the advantage and the benefit. Remember to use the ‘So What’ test and make sure you ask the ‘Why?’ questions.
Now we understand what makes up a value proposition, it is now time to actually do it…and here’s what you do.
Ask yourself this question…What is it that we do that is better than everybody else? Make a list.
My old boss used to say that if you can’t explain what you do as a business in one sentence, you have a serious problem. The same is true here. You should be able to describe your value proposition in one sentence. This uses the list from point 1 combining this with the brand voice.
Once you’ve done that then you need to publish your value proposition where your target audience will see it. That’s where your communications strategy will play an important part.
Lastly, be hard on yourself. Come up with a choice of value propositions and then test them. Show them to your audience and ask them what they deem from the statement. Remember, on a website homepage for example, you have no more than five seconds to grab the attention before your prospective buyer bounces.