Value Proposition
What is a Value Proposition?
A value proposition is a clear statement that communicates the benefits and value a product or service adds for its customers. It explains to your customers why they should buy from your business specifically over your competitors. A successful value proposition effectively outlines the problems your product or service solves for your target audience and features tangible results that customers can expect when they choose to buy from you. Your value proposition is a crucial element to your marketing and sales strategies, and can be the difference between a customer choosing you over another supplier.
In this article we’ll cover:
What Makes a Good Value Proposition?
When did you last see a brand and think “Wow. These guys know exactly what I’m looking for. They really see me and understand what I want.”?
Maybe you were scrolling through their Instagram page or you read an interview with the founder in your favorite publication. However you stumbled upon them, the brand that you fell in love with managed to clearly articulate to you the value that they would add to your life or your business. Essentially, they had a killer value proposition.
Take Slack as an example. The headline of their value proposition is simple: making work life simpler, more pleasant, and more productive. Slack does this by bringing all your customers, conversations and apps into one place. And with over 200,000 paid customers using the software, Slack’s value proposition demonstrates just how instrumental it can be for teams to make their work life simpler, more pleasant and more productive.
But why does this kind of value proposition resonate so well with Slack’s target market?
No more navel gazing
The reason so many Slack customers believe in its value proposition is clear. They can see themselves in the language. Rather than explicitly telling the target audience how great Slack is, the value proposition hinges on the basic principle that Slack can help customers to overcome communication barriers with their teams and their customers. Genius.
Successfully crafting your own value proposition requires you to really get into the head of your customers and understand what they need from your product or service.
How to Create an Effective Value Proposition
We’ve already outlined what makes a great value proposition, but how can you take your brand from bland to brilliant in the eyes of your customers? Start by asking yourself a few key questions to get a better understanding of what you need to articulate in your value proposition.
- What precisely does your product or service do?
Be specific here. Does your software just generate revenue? Or does it help media companies find new, engaged audiences looking to discover their next favorite series?
2. Who is your target audience?
Think carefully about who your ideal customers are. What industries do they belong to? What level of seniority is their job role? Who is their current supplier? What size of organization do they belong to? You might also want to look at developing buyer personas of the people already in your customer base to give you real-world insights.
3. What are the pain points for your target audience?
Identify the particular business problems your audience is hoping to solve. Is it to build brand awareness in hard-to-reach markets? Or maybe to better track the ROI of events activity to prove the value of marketing efforts?
4. How does your product or service address these pain points to deliver value?
What is the unique benefit your business offers your customers? Where in the customer journey does your product or service streamline a process, make things more efficient or deliver an elevated experience?
Structuring your value proposition
Now you’ve got into the mindset of your customers, you can start to draft out a full written expression of your value proposition. Below, we’ve included a suggested framework to get you started.
Pithy headline
Airbnb is a great example of a simple headline: Host anything, anywhere, so guests can enjoy everything, everywhere. Your headline should be memorable, and your customers should immediately be able to get an understanding of what your product or service offers them.
Brief explanation of pain points
Outline the current situation causing your target audience a headache.
How your offering addresses them
Here, you will articulate the ways in which your business can solve your audience’s challenges. Be creative in your storytelling. Imagine how your product or service can tangibly change the day-to-day lives of your customers, and show them how much time they could save, how much more data they could access or how many more sales they could make.
Proof points
Statistics and testimonials give validity to your value proposition. How many customers have you helped achieve their business goals? How much have you improved performance? How many markets do you operate in? Give your customers reasons to believe in the power of your brand.
Memorable sign off
As with your headline, include a wrap-up sentence that will cement your brand in the mind of your customers. It should be short and sweet, and ownable to your business based on the pain points you’ve identified and the solutions your product or service specifically offers.
Communicating Your Value Proposition in Sales
Your value proposition will run through everything you do as a business, across every channel from your website, to your social profiles and your presence in the media. A successful value proposition will align all parts of the business in providing a unified messaging framework that is consistent no matter where you are meeting your customers.
In sales, this will mean your outreach communications. From your cold emails, to your social prospecting and your discovery calls, your key messages should be reflected in every touch with your prospect. In every email, or call, you’ll want to outline exactly the pain points your customers are facing and how your business can solve them, always tying the communications back to your value proposition headline.
Take a cold outreach email as an example, it might look something like this:
Subject: Need better data on how your B2B webinars are performing?
Hi Sarah,
I noticed you work with Gravitax in their events team, I used to work with Fred, your head of commercial in my last role!
Are you struggling to get a clear picture of who is attending your webinar series and how they are engaging with your content? We see this a lot, in fact 63% of customers that we talk to don’t know when their audience drops off a conference. And 71% struggle to keep webinar attendees engaged after the event has taken place.
Solus plugs into your webinar platform like Zoom or Teams and provides granular data on who shows up, who never tuned in and which points of your webinar saw the highest engagement. And our CRM integration means that you can segment your follow-up activity to target your customers based on what they really want from your content. Our packages start at just £170/ month, because we know how hard it is out there for start-up events teams in this market.
Get to know the customers behind your content with Solus.
Want to know more? Book a discovery call with me here or reply to this email and we can get something in the diary.
Have a great day,
Mark
Common Mistakes to Avoid When Creating Your Value Proposition
Don’t overpromise
It can be tempting to position your product or service as the silver bullet that will drive more sales, or make your customer go viral on social media or reduce their budget by 90%. But customers will see straight through any claims of fixing all of their problems at work. Be honest about the actual value of your product or service and proudly advocate for how it’s helped other customers do better business.
Avoid generic statements
In a competitive marketplace, your value proposition should be ownable to your brand. Look at competitors and see how you can differentiate your product or service, and speak to what makes you unique. Do you service a particular sector? Do you have best-in-class service levels? Are you more competitive on price? Find your niche and own it.
Center your customer not your business
We’ve already spoken about why your value proposition needs to center the pain points of your customers. To convince a prospect to buy from you, they need to see themselves in your proposition. Make it easy for them to see how you can help solve a pressing issue they face in their jobs.
Regularly update your value proposition
Test and learn is essential for all aspects of business, but especially so for developing a strong value proposition. As you learn more about who your customers are and what they need, you should amend your value proposition accordingly. What was true last year for your market might now be irrelevant. Regularly gather customer insight and keep ahead of the competitor landscape to shape your value proposition effectively.
The Power of a Personalized Value Proposition
If you sell to multiple sectors and markets, you will need to tailor your value proposition to each audience segment. If a pain point rings true for your British market, for example, it won’t necessarily correlate to the experiences of your prospects in the US.
It might seem like a lot of work to amend your messaging, but personalized emails achieve an impressive open rate of 29%, and an unbelievable 41% click-through rate.
Tools like Surfe help you craft personalized message templates in LinkedIn and InMail, so you can target your sales outreach to the specific pain points of each of your audience segments. So, you can elevate your communications and convert more leads.
Frequently Asked Questions (FAQs) about Value Propositions
What is a value proposition?
A value proposition is a simple statement that explains why a customer should buy your product or service, and the value it adds for your target audience.
Why do I need a value proposition?
Your value proposition is an essential component to your sales and marketing strategies. It can be the difference between a customer choosing to buy from you or choosing to go elsewhere.
What makes a good value proposition?
A good value proposition will detail how your product or service addresses your customers’ common pain points. It will be clearly memorable and will be supported by proof points to persuade your customers of the value of what you are selling.