How to Write a Value Proposition
In many ways, developing a clear and compelling value proposition is the most important part of the effective market opportunity assessment; after all, how can you sell a product or service if you can’t articulate its value? Before we can delve into the specifics of how to write the best value proposition for your business, we must first define the term and understand its meaning. A value proposition is a promise of value to be delivered and acknowledged and, consequently, a belief from the consumer that this value will be delivered and experienced. As part of an overall business strategy, a value proposition can apply to an entire organization, or parts thereof, customer accounts or products or services.
One model many marketers go by is the Value Proposition Builder, with six stages to the analysis. These include:
1. Market – For which market is the value proposition being created?
2. Value Experience or Customer Experience – What does the market value the most? The gathering of real customer, prospect or employee feedback is what determines the effectiveness of the value proposition.
3. Offering – Which products or services are being offered?
4. Benefits – What are the benefits the market will derive from the product or service?
5. Alternatives and Differentiation – Is there an alternative option, or options, the market has to the product or service? If so, what are they?
6. Proof – Is there evidence to substantiate the value proposition…and if so what is it?
So How Do You Develop a Compelling Value Proposition?
The process for writing a good value proposition consists of three stages:
- Identifying Customer Benefits
- Linking These Benefits to Mechanisms for Delivering Value
- Mapping the Basis for Differentiation or Market Play
Regardless of what specifics are involved in this process, we can’t stress this enough: At the heart of this marketing tactic is putting yourself in the shoes of your target customer and identifying – from his or her perspective – what value your product or service offers. Believe us when we tell you that the revelation for most entrepreneurs is being able to distinguish between what excites THEM about the technology and what value the product may ultimately bring to the customer.
To begin with, it’s important to note that your customer and the end-user of your product or service may not be one and the same; you might be selling to an original equipment manufacturer (OEM) or distributor, for example. Differentiating between what your CUSTOMER and the END-USER perceive as value can assist you in communicating your value proposition more clearly.
In writing your value proposition statement, you should address what market you are targeting, what product or service you are offering, how you are delivering it and why. From experience we can tell you that the chances are good that you’ll be developing more than one value proposition for various markets – we often tell our clients to focus on one sector first, go through the market assessment, collect the “voice” of the customer feedback and validate their value proposition…they can then repeat the process for another market.
So, let’s break it down: In a nutshell, your value proposition is a clear statement that:
- Explains HOW your product solves customers’ problems or improves their situation.
- Delivers the specifics about BENEFITS (quantified value).
- Tells the ideal targeted demographic WHY they should buy from you and not from the competition (unique differentiation).
You need to present your value proposition as the first thing the visitors see on your homepage, but it and its language messaging should be sprinkled all throughout major entry points of the site. This is not just aesthetics or to placate a CEO or copywriter – it improves your customer lifetime value.
What the Value Proposition Consists Of
Normally beginning with a block of text – i.e. a headline, subhead and one paragraph – with a visual such as a photo, hero shot or graphics, the value proposition can be written following this formula:
- Headline – In ONE short sentence, define the end-benefit of what you’re offering as an attention-grabber.
- Subhead (or Two to Three Sentence Paragraph) – Here’s where you give a specific explanation of what you do and/or offer, for whom and why it is useful.
- Three Bullet Points – List the key benefits or features.
- Visual – Images communicate much faster than words, so show the product in a “hero shot” or an image reinforcing your main message.
Value Proposition Examples/Boosters
We have found that sometimes, it’s the little things that tip the decision in your favor. If you find most of the major elements you’re selling are similar to your competition, you can get ahead by offering small value-adds which we call “boosters.”
These can be messaging elements such as:
- Free Shipping!
- Fast Shipping/Next-Day Shipping!
- Free Bonus with Purchase!
- Free Setup/Installation!
- No Setup Fee
- No Long-Term Contract/Cancel at Any Time
- License for Multiple Computers
- (Better Than) a Money-Back Guarantee!
- Discounted Price
Examples of good value propositions include websites that boast clear messaging regarding what the company is and for whom, specific lead paragraphs, key features outlined above the fold, relevant images and the aforementioned boosters.
The key thing to remember with value propositioning is that you don’t need to be unique in the whole world – just in your customer’s mind. The closing of a sale takes place in a customer’s mind, not out in the marketplace among the sharks of the competition.