At the end of the day, a huge part of marketing and sales comes down to the ability to convey the value of one’s product or service to the customer. If a prospective customer doesn’t understand your company’s value, or senses that a competitor may be better suited to fulfill his/her needs, you’ll likely lose that business. Not only does your company need a customer value proposition, but it needs one that is clear and effective.
What is a Customer Value Proposition?
Too many businesses confuse value propositions with branding and slogans. These aren’t the same. While slogans are an excellent way to help build your company’s brand and create recognition, they won’t necessarily communicate the right message to your potential customers.
A value proposition tells potential customers what your product or service is going to provide, which is something that will satisfy a particular need. In short, it answers the question, “why should I buy from you instead of your competitor?”
How to Create an Effective Value Proposition
Communicating your “value” can be a tall order, and many companies take a “kitchen sink” approach by giving customers a laundry list of benefits. This can fail to resonate with buyers because it isn’t sufficiently focused on their need.
If you’ve narrowed your market, this should not be an issue because you have identified and understand your customer segment. If you still need some direction, Salesforce recommends that you ask a series of questions to identify your client’s most pressing needs when formulating a customer value proposition.
- What are your objectives with this product or service?
- How do you plan on measuring the success of this purchase decision?
- How will you decide which product or service is right for your needs?
The answers to those questions can help your company better focus its customer value proposition. According to Quicksprout, there are five types of value that you can target:
- Functionality. What problem or need are you addressing? How can you do this better than the competition?
- Economics. Outline the financial advantages such as lower cost and operational savings.
- Emotions. Emphasize the most attractive parts of your offer that can create emotional attachments to your brand.
- Symbolism. Can you convey a sense of luxury or environmental responsibility with your products or services?
- End Value. Do you guarantee something such as customer satisfaction or less downtime?
What is Considered a Powerful Customer Value Proposition?
Effective customer value propositions can be so powerful that they supercharge your conversions. But they are generally more than one line. While there is no specific blueprint for success, there are a few components that you should include that will make your statements more effective.
When putting something in print, you should begin with a headline that captures the customer’s attention. You can also include a subhead with some more information. Follow this up by either a few short sentences or some bullet points that tell the client how you will solve their most pressing problem by also addressing value (free shipping, lifetime guarantee, multiple financing options).
It’s also a good idea to test your value proposition. You can accomplish this through A/B testing and should evaluate just one thing at a time, such as different headlines, graphics, or bullet points. This type of split-testing will allow you to create the best possible value proposition that you can use in both online materials and your sales presentations.
One of the earliest considerations in your company’s marketing plan should be its customer value proposition. When done correctly, this acts as the core of your competitive advantage and articulates to consumers why your business is the clear choice.