A value proposition is everything. If you bury yours in buzzwords and meaningless slogans, your communications often come off as incongruent, alienating your customers as time goes by. On the other hand, learning to understand the power of a great value proposition can help communicate the value you offer and speed up the customer journey for your prospects.
However, learning the ins and outs of building a golden value proposition can seem confusing and demand time that businesses today don’t have. Don’t fret - in this blog post, we’ll help you with 5 great value propositions - and show you how you can create your own.
Building a great value proposition
Organisations often work tirelessly to improve their product or service. However, if you want your business to click with your target audience, you need to be clear about the value you provide and what your customers get out of your company. This is where a value proposition comes in.
A value proposition is a simple statement summarising why a customer should choose your product or service. It communicates the benefits and what sets you apart from your competitors. Most importantly, a value proposition focuses on how customers define your value.
There are three options when writing a value proposition:
Value proposition canvas
A value proposition canvas explores the different components of a company that contribute to a strong value proposition. This kind of process can help team members get a minimum viable clarity - a crunch point between business strategy and brand strategy.
The seven areas of a canvas are benefits, experience, features, wants, fears, needs and substitutes. Each of these is meant to be from the customer's perspective - making it easier to understand their position and how you add value to their lives.
To begin using this method to identify your value proposition, ask the following questions:
- What benefits do your customers regularly receive from using your brand?
- What experience do your customers have when interacting with your brand?
- What features of your product or services do your customers engage with?
- What are your customers’ wants, fears and needs?
- What potential substitutes exist for your customers?
From this, you can create a value proposition that speaks to your customers on their level. For example: “EXtreme Example Company offers an exciting (experience) travel experience that takes customers on an adventure through rainforests, deserts and tundras (features). It infuses adrenaline with unique expeditions that can only be experienced in the distant corners of the world (benefits) - are you living your best life? (wants, fears, needs).”
Further distilled, a one-liner for this could be: Extreme Example Company: “Live the exhilarating life”, or “Take the road less travelled”.
Harvard Business School’s Institute for Strategy & Competitiveness simplified writing a value proposition with three simple prompts. Harvard argues that the value proposition connects the company and its customers, matching customer needs to company offerings.
According to Harvard, to create an integrated, cohesive and meaningful value proposition, simply ask:
- Which customers are you going to serve?
- Which needs are you going to meet?
- What relative price will provide acceptable value for customers and acceptable profitability for the company?
Using Harvard’s method we can create a simple value proposition based on answering the three questions above.
Here’s an example of this in action - “Theme Example Hospital: We help the sick (type of customer) get better (needs to meet) for less (relative price).”
The Steve Blank formula
Steve Blank, a former Google employee who runs the Lean Startup Circle, saw the need for a simple formula that transforms a brainstorm into one sentence. His method further distils the elements of the Harvard method above into a simple sentence.
Simply fill in the blanks: We help (X) do (Y) by doing (Z).
Here are a few examples of this in action with completely random industries to show the flexibility of this formula:
- CGI Film production - “We make your dreams a reality with the technology of tomorrow.”
- Coffee subscription - “We help the world wake up with internationally curated coffee.”
- Printing - “We help businesses talk to customers with quality printing.”
- Custom dresses - “We help you embrace your inner beauty with handcrafted designs.”
5 Great value propositions
Now that you’ve gotten a taste of what makes a great value proposition and the tools to create one for yourself, let’s take a look at some of the more successful value propositions for inspiration.
Uber is a company with a simple service that offers convenience, freedom of movement and cost-effectiveness. The ideals that embody the brand is simplicity and the idea that anyone can access easy transport.
Its unique value proposition encapsulates all the elements above quickly and easily- “Tap the app, get the ride.”
Uber expertly communicates that it takes every pain point from getting a taxi away by being the better option without saying too much. It promotes ease of use and its highly simplified approach to transportation.
Slack is a workplace productivity and messaging app. It’s simple to use and robust enough that large companies can effectively use it. Slack has found success in providing companies with an easy way to communicate, especially in the era of remote work.
Moreover, it has an excellent value proposition - “A messaging app for teams who put robots on Mars.”
If Slack is good enough to use for NASA, then surely it's good enough for anyone else. Furthermore, it generally uses the Steve Blank formula outlined above - “A messaging app (we help with the communication) for teams (who do we help) who put robots on Mars (what we can help you do).
Digit is a relatively new service that allows users to connect securely to their bank accounts using the Digit service, which algorithmically examines users’ spending habits and regular expenses. It then optimises users’ accounts to help them save money into an FDIC-guaranteed savings account, where users can draw money from anytime.
Their value proposition is “Save money, without thinking about it.”
Finances cause a lot of stress in many people's lives, and the proposition that saving doesn’t have to take effort definitely turns some heads. Digit’s value proposition addresses a basic need, fear and want all in a single sentence, making it a great example of a value prop done right.
It’s difficult to imagine being successful in today’s oversaturated technology market. Equally true is that it is difficult to think about technology without thinking about the iconic Apple iPhone. What sets it apart?
Their value proposition for their flagship phone was “Why there’s nothing quite like iPhone.”
Just like its elegant product design, the value proposition from Apple is simple and to the point - promising a different experience in an industry where that previously seemed impossible.
When Airbnb began to disrupt the hospitality industry, it needed to market to two groups of people: those who wanted a place to stay and hosts who wanted to rent out their spaces.
In their own words, “Airbnb exists to create a world where anyone can belong anywhere, providing healthy travel that is local, authentic, diverse, inclusive and sustainable.”
Their rooms are located in places unlike you’ve stayed in before, and are usually cost-friendly to those who like to travel a lot. Airbnb’s are also usually located in neighbourhoods much like the ones you know - making it a sustainable option that lives up to its value promise.
The best value propositions evolve with your customers. Even though you may have started in a different place, it is always important to understand your customers' pain points and what your place is in helping them with that. What sets you apart? Why should your audience invest in you? These are the questions that customers ask and the value proposition answers. Speaking to your customers' needs, wants, and desires will only secure the future of your business for success.
Achieving a great value proposition begins with a clear and concise message. Without clarity, you risk losing leads and money. We know this because we’ve been there - so many of our clients were saying too much about too little, because it’s difficult to be clear. For the past 12 years, Demodia has refined marketing to generate more revenue for our clients, and we can do it for you too.
Contact us now for a consultation. We will provide you a step-by-step approach to improve your brand story, so you can watch your conversion-rates and profits increase as customers uncover your true value.