Creating a value proposition is the best way to communicate how you are different from your competitors in a concise way that matters to customers. Pretty simple, at least in theory. A lot of us exist in a vast sea of competitors where (let’s face it) 50 – 70% of what we do someone else can do. Most of that is based on your products and services as well as other things that you care about such as quality and customer care. Think about pizza for a moment. You have several places to choose from when you want a slice of pizza with options from local family owned restaurants to national franchises. And let’s face it, pizza is pizza, right? Maybe, but everyone has an opinion about who’s pizza is the best and who’s pizza you would choose last. Not all of this is based on the pizza itself either. Location, meal deals, delivery, specialties, price, etc. All of you have your favorite pizza place and if you took the time to think about it, you could create their unique value proposition. In other words, why this place instead of anything else. You need to do the same thing with your company and the products and services that are offered.
A unique value proposition isn’t just about what makes you different, it’s about what makes you different that matters to your customers. For example, you may have a family owned business and that’s great if you do, but does that matter to your customers and, if so, is that why they buy from you? If so, great but, if not it is really more of a nice oh-by-the-way. So if you only have limited time and dollars to share your message with customers, you have to really hone in on what will really make them want to buy from you. Creating value propositions winds up being a lot harder than it sounds once you start to cut the fat away from your sales pitch, so how can we create an effective value proposition? If you focus on this 5 step process, you can create something very powerful while standing out from your competitors.
- Unique Product/ Service – Is there something that you are known for (almost) exclusively? If customers find it valuable then you have a headstart with this process, but not everyone does. In the event that you don’t, like the pizza example, don’t despair. We still have 4 steps to go to discover what is great and valuable about what you sell.
- Unique Markets – Do you specialize with any particular group that most other competitors ignore? If so, then this is another good headstart and you will want to include this. But, like the pizza example, it may be a come one/ come all situation for you. If you don’t have a unique market, fear not because the next steps are the most crucial.
- Why do your current customers choose you over your competitors? – This is where it gets fun. Instead of trying to figure out your unique value proposition, chances are you current customers will tell you, but you have to go deep. Answers such as quality and service are shallow to potential new customers, so find out what specifically they are paying attention to. Sometimes it is something that we overlook such as location, delivery, options or ease of use. Just ask your customers and they will tell you.
- Why do your customers remain loyal? – This is different than step #3 because we want to understand why customers keep coming back. This is different from the first time they choose to do business with you. What keeps them coming back. It most certainly has to be something that your competitors aren’t doing otherwise you would have a much harder time keeping them loyal. Again, just ask your customers and they will tell you.
What will your customers gain by working with you? – There is always something that makes you different from your competitors. Were it not true you would soon cease to exist. Sometimes it is something as simple as location or access and you can’t underestimate the simple things. Again, if you are not sure, just ask your customers and they will tell you what they gained and you will discover yet another valued differentiator.