For a single sentence, a value proposition has quite an important role. It conveys the essence of your brand in terms that are meaningful to your customers, to help you carve a distinct and valued place in their minds.
The best value propositions emerge from the spot where these three factors intersect:
• What you do best.
Identify your brand strengths. What do you offer that makes customers want to buy from you?
• What your customers care about.
Gather customer insight to make sure you know what’s important to the people you currently do business with — and the people you want to do business with in the future.
• What your competitors can’t match.
Do your research to understand what issues are driving your industry, how your competition is responding to those issues, and where you fit within that marketplace framework.
Assuming you’ve done your homework to identify the sweet spot where all three factors align, how do you judge whether you’ve chosen the right value proposition? Start by drafting a statement articulating what it is. Email us for a handy worksheet that covers the five components a value statement should address. You may want to explore several different statements. Give each statement a ranking of 1 (weak), 2 (moderate) or 3 (strong) based on how it measures up on these five filters:
1. Is it Relevant?
Remember that relevance is defined by your customers, not by you. Many value propositions fall short because companies mistakenly focus on things that they value internally, instead of things that are meaningful to their customers. So you’ve been around for a bazillion years. That’s great for you, but it may not mean beans to anybody else — particularly, for example, if you’ve been making tape cassette recorders all those years. State your value from your customers’ point of view in language that reflects what matters to them.
2. Is it Believable?
Be wary of value propositions that stretch credulity with your audience. If you truly are the “world’s best” at something, and can support it with facts, go for it. But keep in mind that the truth of your claim may not be enough if customers still find it hard to believe. If they’re not buying what your selling (figuratively, or literally) perhaps you’d be better off focusing on a more plausible message. At the very least, you should recognize that you have a communication challenge ahead that could take significant time and money to overcome.
3. Is it Ownable?
The strongest value propositions focus in on something that’s unique to you alone, something your competitors can’t also offer. In a crowded or mature market, it might be tough to find such a value position. If that’s the case, try to identify a value position that no one else is talking about. Just remember that your competitors will likely start talking about it once they realize it’s a value customers want. To keep the position you carve out, be prepared to spend at least as much time and money defending it it as your competition does trying to steal it from you.
4. Is it Elastic?
Your value prop should give your company room to grow and evolve. Smart companies are always on the lookout for new opportunities. A good value proposition should not confine you to what you are today, but encompass what you might become in the near-term future.
5. Is it Emotional?
Does your value proposition make an emotional connection with your audience? Often the emotion resonates in the creative expression of your value proposition, not in the statement itself, but it is important to have an emotional component because it helps make your value promise memorable, to sear it into the minds of your customers.
Use these filters to evaluate each value proposition statement you are considering. If any statement tests poorly on any filter, you might want to give it a second thought.
Share your insights or questions about evaluating value propositions. Be one of the first 10 to comment and we’ll send you a valuable Tartan T-shirt.