What is a value proposition? (A simple definition)
Tips / 12.07.2022
Most entrepreneurs that go into business do so for a very specific reason. Setting profit aside, they also believe that the product or service that they offer is something unique. It fills a gap in the market. It meets certain needs and resolves pain points.
As such, they’re offering something of value to their target market, and this is where a value proposition comes in. But what is a customer value proposition, and how can you go about creating a catchy one for your business?
Find out by reading below.
Table of Contents
What is a value proposition, and what is it not
If you’re wondering about the value proposition definition, you’ll quickly find that the Internet is filled with multiple different definitions.
In short, however, the value proposition meaning can be thought of as an integral if not central part of a business’ marketing strategy, and it involves identifying and assessing what your business does best, how you outdo your competitors, why customers should pick you and where you offer the most value.
With this in mind, it’s also important to distinguish between different types of value propositions. Although they are all a part of your marketing strategy and business plan, they can be subdivided into several categories.
These may include the company’s overall value proposition and the value proposition on your website homepage and on your category and product pages. Each one should ultimately give your customers or target market an enormous “why” in terms of the reasons they should purchase or order from your business.
Also, important when asking “what is a value proposition in marketing?” is to determine what it is not. For example, it is not a tagline, it is not a slogan, and it is not too long and not too short.
If we use the Goldilocks analogy, it is “just right”. It catches, in a few short words and sentences, the main gist of your offering, while convincing customers to buy and convert over to your business instead of heading to the competition.
What are its benefits?
So, now that you’ve got a general idea of what a value proposition entails, you may be wondering if you even need one for your business in the first place.
The answer is that with all the competition out there, customers are looking for purchasing and ordering experiences they will love. If you do not help your customers quickly and easily understand what they’re getting with your business, you risk losing them.
But apart from this, a strong value proposition can also help to support your sales and overall marketing efforts. It can contribute to the consistency and clarity of the messaging across your brand. More importantly, however, is that it plays right into the sales and profitability segments of your business, namely, by helping you attract quality leads as well as improve customer engagement.
Elements of a value proposition
As mentioned above, a value proposition is not a catchy tagline (such as McDonald’s “I’m lovin’ it”) and it is an important part of your marketing efforts.
This is why consistency across each of your marketing channels is essential to ensure that you’re offering your customers value and that you’re speaking in one voice.
As a result, a strong value proposition, which usually sits on your homepage but can be present on other pages, too, as well as on brochures and flyers, should be highly specific, focused on pain-points, and is exclusive.
What each of these elements means is: that by being specific, you are immediately setting out to tell your customers the precise benefits they’ll get when they do business with you.
By being pain-focused, you show how you’ll help resolve a customer’s problem or lead to improvements in their life. And finally, by being exclusive, you not only show that you’re a rare industry find, but you also clearly specify how you’re better than your competitors.
Hence, a couple of tips to ensure your value proposition is literally “valuable” and easy to understand include:
- Be concise
- Define what you do
- Be easily discoverable online
- Clarify how you solve pain points
- Be visible across all customer touch points, and finally
- It should answer the question: “Why should I buy?”
How to create your value proposition
Since you now have the gist of what to do to create your all-important value proposition, it’s time to put it into action. But this process goes much further than simply identifying and communicating it to your identified target segment.
Rather, you need to do careful research beforehand to ensure that you’re speaking to your customers effectively in a voice that they will understand and appreciate. Hence, you will first begin by gathering the voice of your customers in your copy.
This will mean studying testimonials and case studies and seeing what voice or precise wording your customers are using to illustrate their satisfaction with your business. This way, you’ll also be able to pinpoint their pain points and speak to them directly.
Next up, you need to consider emphasising clarity before creativity. While it may be tempting to think out of the box, the bottom line is that your text needs to be understandable by a wide range of customers. As a result, you need to speak with clarity and precision and prioritise these over any creative concepts that may either get lost in translation or lose the intended meaning.
Finally, your focus needs to be on the benefits and not the hype that you may wish to create around them. Yes, it’s tempting to describe yourself as the “world’s best ____” but with customers seeing this everywhere, this phrase simply loses its potency and potential to convert.
So, if you’re offering instant settlement for example and none of your competitors is in the Fintech space, that is what you’ll want to emphasise to your audience repeatedly for clarity, consistency and best results.
And there you have it! The answer to the all-important question, what is a unique value proposition?
As you set out defining and creating yours, always think of your customers and have them in mind as you prepare copy for your homepage, webpages, physical marketing and branding materials and more. Don’t underestimate the power of research in this process, as identifying pain points and showing how you can resolve these quickly and painlessly will be to your advantage.
Disclaimer: Please be aware that the contents of this article and the myPOS Blog, in general, should not be interpreted as legal, monetary, tax, or any other kind of professional advice. You should always seek to consult with a professional before taking action, since the particulars of your situation may materially differ from other cases.