Value Proposition is the first thing that determines whether people will take interest in reading about your product more or will they be least bothered about it. It is the main thing that needs to be tested – If you get it correct, it results in a huge boost to your product sales. If anyone would be willing to give you one single piece of advice for conversion, it would be – test and get your value proposition right. The value proposition needs to be good for every company, however, for a lesser known company, it has to be awesome. The lesser known the company is, the better value proposition it needs. Be it websites or advertisements, missing and poor value propositions are found to be the common shortcoming in all sites. Now the question arises that what exactly a value proposition is? A value proposition is an assurance with some value, to be conveyed, acknowledged and it also represents a faith from the customer that the promised value will be indeed delivered to him and experienced by him. It can be relevant to an entire organization or to its parts like customer accounts, products or to its services. Identification and creating a value proposition is an element of business strategy. The strategy is based on and supported by a distinguished customer proposition. The foundation of sustainable value construction is the satisfaction of customers.
Steps To Craft A Compelling Value Proposition:
1. What is it based on?
Development of best value proposition model has its foundation in analysis and review of the costs, value and benefits that an organization can bring to its customers, existing as well as potential ones, and other component groups existing within and externally the organization.
Customer Value Proposition is a business or marketing value statement that describes why a customer should buy a product or use the service of the organization. It is targeted specifically on the prospective and potential customers and not the constituent groups. It is similar to the unique selling proposition which is a defined statement convincing customers that the particular product or service will add more value or be a better problem solver as compared to others in its competitive set.
2. Target the audience:
The audience for a value proposition can be the end user or the manufacturer/ distributor. The initial and continuous satisfaction of the end user is the ultimate goal of every business. Customer satisfaction is achieved when advanced customer value is delivered. Price and quality are the most important factors that take place in a consumer’s purchase.
When the sales target is not the end user, rather, the manufacturer or distributor of a product, the most important factor is conveying the superiority of one product over the other product. It needs to be remembered that mainly the factors that are essential are price and quality; however there may be certain other factors that would affect a customer’s decision and it is important that they are also communicated.
3. Creation of a strong value proposition:
There are a few theories and concepts that help to exemplify what a well-built value proposition should focus on:
i) Unique Selling Proposition – USP: It is the major and directly related concept and is often considered to be the same as value proposition but it only stresses on what makes our product superior than others, the competitors. It is just a fraction of good value proposition.
ii) POD-POD which refers to Points of parity – Points of difference: POD-POD is a procedure which is used to find separate factors between trades. You can start by finding facts for parity that refers to the points that are common with the competitors. And after that the next thing is to find the points of difference i.e., the points which are different from the competitors.
iii) Feature Advantage Benefit- FAB: It is a procedure that assists you to find out what every feature of the product means to the customers. The findings are used to address the concerns, needs, desires and wants. It is begun with listing the features of the products and then the advantage which is created with it. Then it is turned by linking it to the benefit it creates. For example, a stainless steel object, say knife, has an advantage of being non-corrosive and hence the created advantage is that the user does not have to buy a knife every year.
4. Value proposition and its focus areas:
It makes you stress on those facets of your business proposition and ideas that make the largest difference. It helps you to understand what you have to deliver and what makes you the best product in the eyes of the customer. Hence, the aspect that makes you focus on this part is your value proposition.
5. Avoids wastage:
Your value proposition is the fact that helps you shun wastage of any time, energy and money. If you know your customers and their needs, you would save time by not going after the customers who won’t be buying from you nonetheless. You will save money by not offering the products and services that are unattractive for the customers. Also, you will not waste your energy in marketing the features that are not creating any value for your business.
6. Value proposition should give you the base for marketing:
A good value proposition helps the companies in framing their marketing ideas as when the basic idea, the basic feature that is to be promoted is defined, the companies can simply take the basic idea for their marketing promotion from it and refine it further to make it more efficient.
7. Defines how customers view your products:
Without a good business value proposition statement, the organization and its representatives might elaborate about the products and services in a manner that does not reverberate with the prospective and existing customers. It will not be wrong, however, the company will make it sound a bit different and the customers might misunderstand the product. If they are misunderstood, they will not buy the product from you.
8. Ask the customers:
After finding the ideal client, the organization needs to ask them a few questions like their reasons for buying /using their products/services, what things do they like the most in them, what do they have that the competitors do not have and also about other companies that they like.
Asking such questions will enable the company to know what builds the customer’s trust in you, what they really like about your offering, what is your advantage as compared to the competitors as well as which other competitors are your rivals and which other companies attract customers. It also gives you a few options for future strategic alliances.
9. Frame the theme:
By asking the questions and other researches, you have some rich themes to work with. Do not underestimate simplicity. Sometimes the clients value simple things that you do and might not realize it. Resist the temptation to dismiss those simple things an irrelevant and use it as your strong point like the core point of your difference.
Value proposition definitions are generally vague and differ depending on the source. When even the marketing gurus fail to see that a particular feature could be an almost unfair advantage over the competitors, some businesses turn them into their most effective value propositions. The customers don’t know about the competitors offering that might be same as yours if you advertise it and they don’t. Find the core of your business offering. Be specific in your value proposition because when you are vague, people will think that you are a liar. However, when you make a very specific claim, people believe you. Show proof that proves the claim made by you. Guarantee the claim made by you because if you don’t believe that you can deliver the results strongly, how do you expect the customers to believe you. Give them an option to test your claim like free trial, a demo or anything that allows the customers to experience you product first hand. Follow the simple steps and then see the difference.