In today’s marketplace, consumers have many choices. For your business to succeed, you need a competitive advantage that gives your business an edge. Attracting potential customers means educating them about the merits of your product or service relative to those of your competitors, and doing so in a way that grabs their attention. In short, you need to provide them with a value proposition.
What is a value proposition? It’s a brief, clear statement to the customer about how your business can meet their specific needs in a way that maximizes their satisfaction with their purchase. A value proposition is your promise to the consumer that they will be glad they spent their precious dollars with your business.
When done well, a value proposition can be the beginning of a long-lasting business relationship as one-time purchasers become repeat customers and spread the word to others about the utility and value of your product.
Identify Customer Needs
The first element involves recognizing your customers’ needs. Who is your ideal customer? Where are they located, and what is their point of contact with your business? If your business sells camping gear, your customers are people who go camping. In this case, you might target car campers with young kids, or ultralight backpackers. The better you know your customer, the more you can fine-tune your value proposition.
Once you have identified your potential customers, you will consider your customers’ needs. A good value proposition points to key features or components, but a thorough examination of the customer’s need goes beyond the product itself and examines the “why.” What are the customer’s pain points? What keeps the CEO up at night?
The more precisely you are able to identify your potential customer, the better you will be able to target the segment of the market that is most likely to do business with you. Ultimately, all products and services offer a solution to a problem, so demonstrating to your customers that you understand their problem is the first step in convincing them that your brand is the one they can trust to meet their needs, and to do so in a cost-effective way.
Solve Their Problem in a Way No One Else Can
After the customer has seen how your business can solve their problem, they will need to understand how what you are offering provides greater value than anything a competitor might offer. Is your product innovative, addressing the customer’s problem in a completely new way? Perhaps your products offer additional features beyond those provided by your competitors’ products. Tell the consumer why they should be excited about your product. Your competitors would love to have your customers’ business, so you want to ensure that your brand stands out above the rest.
As you craft your value proposition, keep in mind that trust is an essential component of any business relationship. A good business person believes in the quality of their product and knows that they will stand by it, but a customer shouldn’t have to take your word for it. They will want proof.
Whether it be through a demonstration, testimonials, or a money-back guarantee, you will want to anticipate and address any concerns your customer might have. Keep it concise. Use strong, straightforward language and avoid gimmicky marketing jargon. Speak your customer’s language. Adding visuals will reinforce your message.
Only after you’ve offered your customer convincing evidence that your product meets their needs and exceeds their expectations should you move on to cost. Price is an important consideration in any purchase, but the lowest-priced product isn’t always the best choice. That’s why the concept of value should come first.
What sets your product apart from the rest? Be specific. Is it the materials? The workmanship? Your stellar customer support? If your product costs a bit more than your competitors’ but will last longer, perform more reliably, or increase productivity to a greater degree, your product is the one that will provide better value. If there are less tangible benefits, be sure to highlight those as well. Brand loyalty is built on positive feelings and associations.
The final step in creating a successful value proposition is putting it to work. In some ways, your value proposition statement is at the heart of everything you do as a business. By putting it in writing, you are making a statement about the core identity of your business. Your customer value proposition, along with a corresponding employee value proposition, can be part of your mission statement, guiding the decisions of stakeholders at every level.
It certainly should be the focus of your marketing materials, be they print- or web-based. A change in the market or a growth opportunity for your business may necessitate that you revisit and revise your value proposition. By employing this valuable tool, you can see to it that your business will remain profitable for years to come.