Does your business have a customer value proposition? Many business owners overlook this crucial step, assuming their value proposition is obvious. This is only sometimes the case. Here’s what you need to know about creating a solid value proposition statement for your organization.

What Is a Value Proposition?

A customer value proposition, or a unique selling proposition (USP), summarizes the unique benefit your company provides through its products or services. In other words, why should your target audience buy what you’re selling?

It’s not the same as a mission statement about your company. It’s also not a tagline, which is often catchy but vague. The value prop is about what you sell and why it’s great. In a Venn diagram of sales and marketing, the USP sits in the middle, whereas a tagline would fall somewhere between marketing and branding.

As a business owner, you’ve likely given this much thought. For your employees, though, it’s not always intuitive. Leaving them to guess or summarize your USP independently creates a muddied message for potential buyers.

You’ll need to make your customer value proposition clear both internally to your employees and externally to your customers, whether on your website or during a sales pitch. Despite its importance, many business owners are surprised to find that they need help articulating their value proposition clearly and concisely.

What Makes a Compelling Value Proposition?

A compelling value proposition is authentic, truthful, and persuasive in conveying your product’s purpose to potential customers. It should encapsulate what problem you’re solving and what sets your product apart from the competition.

Think of it as your product’s elevator pitch. If it is not cohesive and clear, you risk muddying the waters of your branding and missing out on sales.

While getting this right is crucial, entrepreneurs are sometimes too close to their product or service to understand what their clients find to be the most exciting or valuable component. As time passes, periodic check-ins are a good idea to ensure that your value proposition still matches your customer’s experience.

How to Create a Value Proposition

Whether revamping your value proposition statement or starting from scratch, the steps are the same.

First, clarify your main selling point. It’s not enough to know only what your product does or what gap it’s filling in the marketplace. Why should your target customer choose your product or service specifically? What sets you apart from your competitors?

Once you have that in mind, it’s time to summarize your customer value proposition in a short, memorable statement that you can feature prominently on your website and in your marketing and sales materials.

Ready to give it a shot? Here are three tips to consider when crafting your customer value proposition.

• Be specific and authentic. Rather than using generic sales language like “best” or “number one,” focus on concrete differentiators. What exactly makes you stand out? Is it your price point, materials, or unique process? Lead with specifics that customers can understand and verify.
• Be persuasive and clear. The purpose of your USP is to convince customers to buy. Avoid industry jargon and keep your audience in mind. Confidently communicate what they need to know in the language they understand.
• Be one-of-a-kind. Your value proposition should be unique to your company, product, or service. It shouldn’t be something that could just as easily refer to your competition. What would make someone choose your product over other similar products?

Strategies to Compose a Remarkable Value Proposition

As concise as a business proposition often is, it takes effort and skill to craft one that will get the job done. The strategies behind effective value proposition design are examined in the aptly-titled book Value Proposition Design by Alexander Osterwalder, Yves Pigneur, Greg Bernarda, Alan Smith, and Trish Papadakos.

In the book, Osterwalder et al. point out multiple elements of a value proposition that you need to consider when crafting your marketing and sales messaging. By pulling the pieces apart, examining each, and then putting them back together, you can gain clarity on your product’s selling points and advertise more effectively.

If you haven’t considered these points already, it’s worth seeing whether they can help you strengthen your branding. Here’s what to know about how to create a compelling value proposition.

1. Jobs

In Value Proposition Design, Osterwalder et al. state that one of the first things you must establish in your marketing value proposition is the job your customer wants to accomplish using your product or service. Jobs typically fall into two categories: functional and social.

Functional jobs are physical tasks that need to be completed. Social jobs are tasks that increase the customer’s esteem in the eyes of others. Often, social jobs are voluntary, while functional jobs are necessary.

2. Pain Points

Once you’ve identified the job your customer wants, you’ll need to figure out what pain points stand in their way. Pain points are problems in the customer’s life that your product or service intends to solve. Typically, these obstacles arise between a customer and their desired goal or outcome.

The best value propositions understand these obstacles and how the product will solve them. This step includes an identification of competitive advantages. Why does your company solve these problems better than your competition? What are they missing that you’ve figured out?

3. Gains

Gains are, to put it simply, the benefits of using your product or service. There are required gains, which are the bare minimum objectives that must be met—the most basic function of a product. There are also expected gains, such as quality or longevity, that might not be spelled out in the description but are still needed to satisfy the customer.

Finally, there are desired gains: extra benefits the customer does not expect, intended to surprise and delight them. These desired gains are often what keep people coming back. This category can set you apart from your competitors.

4. Product Components

Rather than examining your product’s overall purpose, break it down into more minor elements to create a list of features. Begin with the physical components, then proceed to the intangible components, such as a warranty or a money-back guarantee. Think about how each component works together to alleviate customer pain points.

5. Presentation

The presentation aspect of your compelling value proposition is all about how it looks on paper. Can you sum up the selling points in a concise manner? Any product or service that requires more explanation than a simple phrase will be tough to market and sell. Try to distill your product’s most important features into a bite-sized sentence.

6. Customer Feedback

Even a compelling value proposition might need tweaking as feedback rolls in. What are your customers saying about your product or service? Our customers can point out selling points we weren’t even aware of. Other times, feedback can let us know if we’re not delivering on the promises our value proposition tries to assert. Either way, adjustments may be needed.

7. Profit

Does your value proposition match your profits? A strong, clearly communicated, compelling value proposition should boost your sales. If you’re not seeing an increase in profit after clarifying your value proposition, you need to look at how you’re presenting your messaging.

Crafting a compelling value proposition is as much a science as it is an art, but Osterwalder et al. make a complicated process much more straightforward. I highly recommend the book Value Proposition Design if you want to hone your value proposition and learn more about marketing your product or service.

Common Value Proposition Mistakes to Avoid

Even well-intentioned businesses can occasionally stumble when trying to create a value proposition. Here are the most frequent pitfalls to watch out for:

1. Focusing on Features Instead of Benefits

One of the most common mistakes is to list what your product does rather than focusing on the impact it has on your customer’s life. Resist the urge to lead with product specifications. Instead, consider a specific audience with a particular need, and then tailor your value proposition to meet that outcome.

2. Being Too Vague or Generic

Your unique value proposition should be so specific to your business that it couldn’t apply to any of your competitors. Avoid phrases like “high-quality service” or “competitive prices” that could describe any company in your industry. This is about what sets you apart from your competition in the minds of your customers.

3. Trying to Appeal to Everyone

This mistake might seem counterintuitive—after all, don’t you want your business to appeal to everyone? The answer is no. A surface-level approach that tries to serve every possible customer will dilute your overall message. Instead, get hyper-focused on your primary target audience and speak directly to their needs.

4. Making It Too Complicated

Can you explain your value proposition clearly in 30 seconds or less? If it requires multiple minutes to explain or includes industry jargon that confuses rather than clarifies, it’s too complicated.

Remember that your value proposition is for your customers, who might not necessarily be industry insiders. Customers make quick decisions, and a convoluted message will lose their attention before they even understand your offer.

5. Centering Your Company Instead of Your Customer

Many businesses make the mistake of focusing their value proposition on themselves rather than their customers. Statements like “We are the leading provider” or “Our 20 years of experience” highlight company attributes rather than customer benefits. Your value proposition should always answer “What’s in it for me?” from the customer’s perspective.

Implementing Your Value Proposition Across Your Business

Once you’ve crafted your value proposition, the real work begins: implementation. Your value proposition isn’t just a marketing statement—it should be felt in every aspect of your business operations.

Start by ensuring that your entire team understands and can articulate your value proposition. Train your sales staff to weave it naturally into their conversations with prospects. Ensure your customer service representatives understand how your unique benefits should influence their customer interactions.

Your value proposition should also guide your new product development. Every decision should be filtered through the lens of whether it reinforces or detracts from your core promise to your customers. This consistency between what you claim and what you deliver builds trust and strengthens your position in the market.

Finally, regularly double-check your marketing materials—from your website copy to your social media presence—to ensure they all reinforce your value proposition for business. Inconsistency confuses customers and weakens your competitive advantage.

Although it will take some fine-tuning to get your value proposition just right, it’s worth taking the extra time and effort to create a statement that will clarify your messaging and drive your business forward. This vital step will give your marketing a central thesis and create unity in your organizational goals.

Is your value statement working for your company? A business coach can help. You can click here to schedule a complimentary video call with Coach Dave to help you with your customer value proposition.

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