How strong is your product’s value proposition? While any entrepreneur can tell you what their product or service does off the top of their head, most struggle with crafting a compelling value proposition on paper. It can be helpful to take a step back occasionally to evaluate whether your current messaging works for you.
What Makes a Compelling Value Proposition?
A value proposition is a statement that summarizes the unique benefit that your product or service offers. This differs from a tagline or slogan, where entrepreneurs often get tripped up. Instead, it should encapsulate what problem you’re solving for your customers and what sets your product apart from the crowd.
A compelling value proposition is authentic, truthful, and persuasive in conveying your product’s purpose to potential future customers. It should be free of generic marketing buzzwords that don’t mean anything. Instead, it should be specific to your product and must communicate a direct benefit or need not being fulfilled by your competition.
Think of the value proposition as your product’s elevator pitch. If it is not cohesive and clear, both internally to your employees and externally to your customers, you risk muddying the waters of your branding and missing out on sales.
While getting this right is crucial, entrepreneurs too close to their product or service frequently must catch what 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.
Strategies to Compose a Remarkable Value Proposition
As short and sweet as a value 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 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 must determine what pain points stand in their way. Pain points are problems in the customer’s life that your product or service intends to solve. Usually, these will be obstacles that come between a customer and their goal or ideal outcome.
Please understand these obstacles and how your product will help them out. 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 needs to 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. Start with the physical components, then move on 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.
Are you interested in learning more about entrepreneurship from an experienced business coach? Click here to sign up for my free email list to have new blog posts on business and leadership delivered to your inbox weekly.
Coach Dave
- Even the Best Entrepreneurs Don’t Know How to Write a Compelling Value Proposition - October 17, 2024
- Why Do We Always Underestimate the Completion Time for Our Tasks? - October 10, 2024
- Expert Tips to Conduct Touch Base Meetings with Your Direct Reports - October 3, 2024
