Creating Compelling Customer Value Propositions HTML version

In simple terms, a ”value proposition’ is the sum total of the benefits that customers receive when
they purchase a specific product or service from your business.
Your product or service value proposition is a powerful statement designed to capture the mind
and the heart of your customers by demonstrating a relevant advantage in purchasing from you. It
is usually articulated as part of your branding, in advertising or sales literature, as a tag line
appearing on product packaging, or is communicated directly when speaking with your
Getting the value proposition right for what your business sells is important, because it provides
the basis for your business relationship with your customers; that is, it answers the question
foremost in every potential customer’s mind: Why should I buy from you?
Does Your Value Proposition Communicate Effectively?
As a business owner, you are passionate about what you do. You love each of your products and
services, know them to be much better than those of your competitors, and understandably want
to tell as many people as possible about them – how your bread is fresher, how your clothes are
more fashionable, how your software has more functions, or how your doohickie has more
The problem is that when you use this style of language to talk about your products, the core
message you are communicating is centred on your view of your products, which may not reflect
your customer’s purchase motivations.
When talking about your products and services in this manner, your message often sounds to
customers as Ðthis is what I sell, and I am running through a long list of the reasons why I think
you should buy it.“
What your customers want to hear, however, is a clear statement that demonstrates that you
understand their situation – that you recognise the problem they wish to solve, or the outcome
they wish to achieve – followed by a specific offer or explanation as to how you are going to help
them address their situation.
Ideally, the value proposition will not only explain how owning your product or using your service
will allow the customer to achieve a desired outcome; it will also explain how it is that your
business is uniquely positioned to create that outcome.
Creating Compelling Customer Value Propositions
The most important guiding principle for creating a compelling, customer-focussed value
proposition is this: the value proposition should focus on customer needs, not on product or
service features.
To put it another way, do not simply explain the products and services you sell, or embellish their
features. Instead, detail the benefits to the customer of owning your products or retaining your
Copyright ¨ Mark Neely 2008
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