When starting a new business venture, a key success factor to establish is your value proposition. It’s also helpful for existing business owners to revisit their value proposition from time to time to help continued business growth.
But what is a value proposition, and how should you go about writing one?
What is a value proposition?
In short, a value proposition is a promise by a company to a customer. It explains:
- what benefits your company provides
- who you provide those benefits for
- how you do it uniquely well.
Your value proposition should be focused on delivering unique and sustainable value to your ideal customer.
Why do you need a value proposition?
As an internal tool, a value proposition helps make sure employees and management are aligned by understanding the benefit the company is trying to deliver. It helps everyone focus on the aspects of the business that make the biggest difference. A strong value proposition can therefore help you avoid wasting time, money and energy.
The right value proposition reveals the connection between your products and your potential customers’ goals. Being clear on that will give you the confidence and clarity you need for continued development and innovation of your products and business processes whilst maintaining profit. It should also give you the basic wording for your marketing messages, focusing on the few things that make the biggest difference.
How to write a good value proposition
Before writing your value proposition, you need to be absolutely clear on why a customer should buy from you. You should have a clear understanding and commitment that your product or service will add value to a target audience. Thinking about the following might help:
- Customer Needs and Insights:Are you able to solve problems, reduce costs or increase sales?
- Added Value:Are you able to add value to your customer?
- Unique Selling Point:Is your product or service innovative or are you able to offer a point of differentiation over your competitor?
- Proof:Can you create trust and quantify the benefits so that the customer believes you?
- Customer satisfaction:How are you going to exceed expectations?
Alongside this, make sure you consider all the risks in your business and be realistic with your financial expectations. Return on investment must always be at the forefront, but do not forget the importance of cash flow and the resource time required to administer. However creative you may be, I strongly recommend that you formalise a project plan or sales forecast before you get too far down the road. Key milestones and the introduction of measures will help ensure that you stay on track or adjust to compensate for any deviations caused by obstacles.
Once you’re confident that you have a product or service people want, and is financially sustainable, it’s time to write your value proposition.
When writing your value proposition it’s important to remember that it’s for people to quickly read and understand. So keep it clear and concise and avoid jargon. Try to use the type of language your customers use. You need to address:
- What is it you’re offering?
- Who is it for?
- What problem does it solve?
- How is it useful? What is its key problem-solving capability?
- How is it unique?
Structure-wise, aim for a strong headline that grabs attention, and one short paragraph to explain what you do, for whom and why it’s useful. You may also have a sub-heading, three bullet points or a visual. There’s no set format, just keep it focused.
How to use your value proposition
Having a great value proposition isn’t enough. You need to use it!
Firstly, make sure everyone within the business knows what it is. Then use it to target the customers who will benefit most from your product or service.
Make sure your customers can see it. If it’s carefully considered and well written, put it front and centre on your website homepage – it should help potential customers quickly understand why they should use your company.
You may find that you need one value proposition for your business and then a series of propositions for individual product lines. That’s fine, just apply the same logic to each.