Value Proposition: A Short Lesson in Selling
A value proposition is an offer or message that explains why a product is different or better than competing products. Value propositions are an essential part of marketing. When you consider all of the options available in your market, what makes yours the best choice? Is it the lowest price, the highest quality, the most significant number of features, or some combination of these three factors?
The Value Proposition is a straightforward concept which can be used for any business. We are all selling something to somebody, and to succeed, we need to figure out what that something is. In the business world, the Value Proposition is what separates the people who make money from those who don't. It's not the technology you're selling but how you're selling it.
In my opinion, the most important thing for a salesperson to learn is value. In other words, what value does your product or service offer your customers?
I'm a massive advocate of value proposition because it helps you understand what the customer needs and how your solution can solve their problems.
However, the problem with most people is that they focus too much on the product and not enough on the customer. They're often so caught up in the product's benefits that they forget about the benefits the customer will get from using the product.
So how can you overcome this?
Well, if you have a great product, then there's no need to worry. But if you're struggling to sell, I want to help you understand the value.
And to help you do that, I've put together a short guide to help you identify your value proposition and how you can better communicate it to your customers.
Table of Contents
What Is a Value Proposition?
A value proposition is a compelling story that answers three questions: Why should I buy this product? What does it do? And How is it going to benefit me?
In advertising, these three questions are called the 3 C's of Value.
Value, the first part of the 3 C's, refers to the perceived benefits of using the product. Value makes you feel better about using the product, saving money, reducing pain, or improving performance. The second part of the 3 C's – what it does – is what the product does and its effect on the body, the environment, or society. And lastly, how is it going to benefit you? This is where the story comes in and why it's so important.
When crafting a value proposition, you want to ensure that you have something compelling and meaningful to tell your audience. It's also important to be honest, even if your product doesn't provide the perfect solution for everyone.
The truth is, you will have to find a way to differentiate your product from others on the market or offer enough unique benefits that your potential customers know why they need to buy it. The goal is to answer the question, “What is it that sets you apart?”
Ask Yourself, “What Am I Telling People?”
Once you've decided on your value proposition, it's time to ask yourself a few questions to determine what kind of impact you're making with your product.
Do you have a product that's easy to understand? Are you being clear and concise when explaining the benefits? Do you clearly explain what the problem is that your product is solving?
Is it clear what the product is, what it does, and how it will make a difference? Does it answer the question, “Why should I buy this product?” If it's missing something, try adding a few extra details. Make sure that it's clear, simple, and compelling.
Are You Speaking in the Right Tone?
Your tone can make or break your pitch. It can also be an excellent tool for communicating your message and creating the emotional connection that drives sales.
You can use your voice, choice of words, and delivery to communicate that your product is the best, trustworthy, and just the right thing.
It's important to convey confidence in your product. Use words that inspire trust and a desire to learn more. Ask yourself, “Am I telling people what they want to hear?”
Consider the following examples of standard pitches:
- I'm sure you want the best for your kids, so you'll love the organic food that I sell!
- We've seen our company grow in the past ten years. Now we're ready to share our knowledge and expertise with you.
- We're a family-owned business, and we take pride in providing quality products and exceptional service.
- We make a real difference in the world by positively impacting people's health and the environment.
- You'll get the highest quality products, the best customer service, and a chance to save money when you work with us.
- We are a great team that provides value to our customers.
- I'm confident our product will help you because we only choose the best ingredients.
- We have a team of dedicated and caring people who are passionate about what they do.
- You'll get an affordable, convenient, healthy product that you won't find anywhere else.
- I'm excited to share our story with you because we are proud of our values and believe our customers deserve them.
- I'd love to tell you more about our team, our products, and the benefits of working with us.
Why Do We Need a Value Proposition?
In business, a value proposition is a written statement about a product or service that makes it more valuable or desirable to the target market. If you're looking for a job, a value proposition might sound something like this:
“As a recent college graduate, I have a degree in [subject], and I am looking for a position where I can use my knowledge to [advance in my career]. My experience and skill set [match the requirements of the position] and I am willing to work hard to learn [the job responsibilities]. I look forward to meeting with you to discuss [your organisation's values and mission] and to see if [our company] is a good fit for you.”
What Is the Purpose of the Value Proposition?
A value proposition's purpose is to communicate why a buyer should choose your products and services over your competitors. When communicating with customers, you must clearly articulate your value proposition to convince them to buy from you.
Value Propositions for Marketing Materials
Your value proposition is essential for marketing materials, such as brochures, flyers, and sales presentations. Value propositions are also helpful when writing articles for your website or social media sites.
When creating your value propositions, consider the following:
- A value proposition is designed to make a potential buyer want to do business with you. Therefore, it should be written in a positive, appealing tone. A value proposition for a salesperson could be, “We have experience selling [this type of product] to your industry, and we can help you do the same.” Or, “We can offer you a custom-designed package with the latest technology, and we can provide outstanding customer service.”
- A value proposition for a marketing professional might include, “Our team of designers and graphic artists can create marketing material that communicates your message effectively and helps you meet your goals.”
To ensure your value proposition is compelling, consider the following:
- Keep the main idea in mind. Avoid using too many words or going into excessive detail. If your audience is interested in hearing more about your products and services, they'll be interested in reading about them. If you're looking to build a relationship, the value proposition should focus on the benefit of the relationship.
- Think about your company and its values. Ensure your value proposition supports your company's mission, vision, and values. You'll want to avoid saying negative things that may conflict with your company's values. For example, if your company doesn't accept unsolicited proposal requests, a value proposition that says, “We provide free proposal writing and marketing advice” may seem enticing, but it's misleading.
- Make sure your value proposition is specific. It should focus on one reason the buyer wants to work with you instead of your competitor. For example, if you're pitching a financial investment firm, your value proposition should state, “We provide customised portfolios that will help you achieve your financial goals.”
- Keep it brief. Don't write more than a couple of sentences. If your audience is busy or short on time, they may not have the patience to read through lengthy value propositions. Consider how long the value proposition will appear on a website or social media post, then keep it to three sentences or less.
- Keep it consistent. The same value proposition is used throughout all of your marketing materials. Consistency is critical for effective marketing.
Ask yourself these questions:
- How would my potential customer describe me?
- What does my target market like?
- What are my company's strengths?
- What are my company's weaknesses?
- What do my customers expect?
- What does my competition offer?
- What does my competition charge?
- How do I benefit from working with my competition?
- How can I differentiate myself?
- How can I make the process easy?
- Can I make the process better?
How to Write a Unique Value Proposition
There are many different ways to define value. Each is unique, but they can all be boiled down to one thing: why should someone choose you over your competitors?
Most businesses don't offer anything new or unusual. They follow the same old formula. But some do have something unique or special to offer. Those companies have figured out a way to communicate their value proposition.
When it comes to defining your value, there are two components you need to consider:
- What's new and different about your business
- Why it's worth paying extra
Let's start with the second component. What's new and different about your business? What makes your product or service stand out from your competition?
Why is this new and unique feature or benefit so vital that it merits higher prices?
Your goal should be to articulate a clear and compelling value proposition for your business. This could be as simple as:
- Our prices are lower than other companies
- We offer free shipping
- We have a better selection of products or services
These statements help your customers understand why they should choose you instead of your competitors. It's also helpful to focus on your specific value rather than a general statement about your business.
Think about how you describe your products and services to your customers. Do you focus on features similar to your competitors, or do you highlight something new and unique? If you're like most businesses, you probably focus on your unique features. But think about it: is it the most effective way to get noticed?
A value proposition is different from a description or tagline. A tagline is what you say to a potential customer. It's usually the first thing a customer hears when visiting your website or calling your company.
A value proposition is different. It's what you say about your business. It's the promise you make to customers about what your company offers. Think about how you might present your business in a commercial. You'd make a clear and compelling promise.
How would you sell your product or service? You'd have a tagline for your business, but you'd also have a value proposition. It's what you say about your company. It's what you promise to your customers.
In other words, the value proposition is what you say about your business. It's what you're selling. A value proposition is a promise. It's how you show your customers what you can do for them.
Here are some examples of ordinary value propositions. Think about how you might use these in your own business.
- We offer the lowest prices for the broadest range of products.
- We have the best selection of outdoor and garden supplies.
- We have the best selection of books, games, and toys.
- We are the largest provider of pet products in the US.
- We deliver the most reliable shipping and returns.
Do you see the difference? What is the most significant difference between these value propositions?
The most crucial difference is that the last one is a promise. It's a promise that your business offers something unique or special. A promise is a promise to do something for your customers.
When we look at our value proposition, we see that it's a promise. And it's a promise to do something unique and special for our customers.
Does this make sense to you? How does the first value proposition differ from the second? Is there anything you notice about the difference?
Now that we've discussed the differences between a value proposition and a tagline let's turn to how you can write a clear and compelling value proposition.
You may want to create a separate document that lists your unique value propositions. In that document, you can write the value propositions that make up the promises you'll offer your customers.
You can also create a value proposition worksheet that you use to track your progress. This is an easy way to evaluate your business's value proposition daily.
Remember: a value proposition is what you say about your business. You promise to do something unique and special for your customers.
If you're writing the value proposition on your own, it's essential to be clear about what you're saying. That's why you should use a Value Proposition Worksheet. You can download it for free and use it to list the unique benefits and features your business offers.
What Happens if a Value Proposition Fails?
Your customers are more likely to be loyal if they feel they get more value for their money. If they feel like they're getting a good deal, they'll be more inclined to stick with you over time. It's easy to think that providing a good experience is optional and, therefore, doesn't have to be a value proposition. But that's not always true.
When value propositions fail, customers tend to switch vendors. They might choose a competitor because they think the price is lower or the quality is inferior. In this scenario, the customer experiences a negative value proposition.
Customers often blame the vendor for the poor value proposition when this happens. But the real problem is that you've failed to offer value to your customers. It's your job to ensure your customers feel like they get more value for their money rather than less.
How Can I Make My Value Proposition Work?
Listening to your customers is the easiest way to improve your value proposition. You may think you know what they want and need, but they may disagree with you. Take their feedback seriously and ask them why they think the value proposition isn't working.
Communicating how you intend to improve the value proposition is also essential. The key is to understand what your customers want and need. If you're confused about your customers' desires, don't hesitate to ask for advice from your sales and marketing teams.
Don't just assume that your customers will be satisfied with your products or services. It's essential to show them they get more value than expected. In addition to listening to your customers, it's vital to demonstrate that you know your customers' pain points and are focused on resolving them.
It would be best if you made your value proposition as clear and concise as possible. You can do this through verbal communication or in writing. Using a CRM or email program, you can easily add a value proposition statement to your messages.
To help you develop your value proposition, ask yourself the following questions:
- Do my customers expect me to provide more than I'm willing to deliver?
- Do my customers receive more value from my products or services than I'm willing to give?
- What can I do to improve the value proposition?
If you can't make your value proposition work, consider offering something else in place of your products and services. Perhaps you could provide a complementary product or service or offer a trial period to help your customers see that they're getting more than expected.
You can also try to improve your value proposition by:
- Making sure your products and services are of high quality and meet the needs of your customers
- Providing exceptional customer service that helps your customers solve their problems
- Offering additional features that your customers want
- Being open to change and adjusting your offerings to fit the changing needs of your customers
- Including your customers in the development of your products and services
Conclusion
Selling is an art and a science. And like all arts, it requires practice and understanding. You must know what you're selling and why someone would want to buy it.
I showed you how to apply these ideas to your business. By the end of the article, you'll have a solid idea of how to structure a business that sells a product or service.
As a side note, selling a physical product will probably have a different value proposition than a service.
And as a final note, there is no “one size fits all” when it comes to the value proposition. Every business will have its own.
Get this free guide and learn about a value proposition!
