A value proposition (VP) explains how customers can benefit from purchasing your product. In this declarative statement, you’ll convince your target audience why they should buy your product instead of your competitors’. Read on to learn how to write an inspiring and effective VP.
Every time someone buys your product or service, they’re making a choice. They’re choosing you over your competitors because they’ve decided your product is more valuable. But when two companies offer similar items with similar features, how do customers reach that decision?
That’s where a value proposition comes in. An effective value proposition convinces your target audience why you’re better than the competition. This statement is a way for you to differentiate yourself from others in your market and explain what customers will gain by purchasing from you. In this article, we walk you through how to craft your value proposition to set yourself apart.
A value proposition (VP) convinces customers to buy your product or service by highlighting your product’s value and unique features. A value proposition goes by various other names, including:
Unique selling proposition (USP)
Unique value proposition (UVP)
Regardless of the term you use, the meaning is the same. Your goal should be to develop a succinct statement—often paired with a visual element—that declares how your services are notable and unique.
A company can also have multiple value propositions for different campaigns or to show different areas of value.
The four main types of value propositions include:
Price value: You’re highlighting why your product or service is the most cost efficient option.
Unique product value: You’re highlighting the unique features of your product or service.
Customer ease or convenience: You're highlighting how your product makes your customers’ lives easier.
Customer results: You’re highlighting how your product or service gets customers results.
Many people confuse the value proposition with the company's mission statement. While your mission statement may inspire your value proposition, the value proposition differs in that it’s external facing.
You may show your mission statement to others outside of the company, but it’s meant to be your internal “why” statement. The value proposition should be your “why” statement for customers, explaining why they should buy your product.Free value proposition template
There are a variety of strategies to write your value prop, but all of them harken back to four key questions. If you can answer these questions about your company and the product or service you offer, then you have all the tools you need to write an effective value proposition.
What do you offer? Explain what your product or service is.
Who is your audience? Identify your target audience.
What value do you deliver? Outline the need you’re meeting or the opportunity you’re providing your audience.
What makes you different? Explain the features and benefits that set your product or service apart.
Other tips to consider when crafting your value propositions include:
Be direct with your audience. Clarity is key.
Use your value prop to explain clear results the customer can expect when purchasing your product.
Avoid sales jargon and buzzwords.
Keep it brief.
The tools below will help you dive deeper into the customer experience and get to know your product or service better. Not only will this help you when crafting your value proposition, but it’ll help you in various aspects of your go-to-market strategy.
The value proposition canvas is a tool where you map out your customer profile and product side by side in order to visualize how they connect. Your potential customers will have needs, expectations, and pain points. Your product should seek to meet these areas.
Jobs to do: Customers use products and services because they have physical, social, and emotional tasks to complete.
Gains or expectations: When searching for a product or service, a customer will have expectations for the product, including things like price point, ease of use, and design quality.
Pain points: Customers won’t buy products if it has certain pain points, including things like high price point, bad customer service, if they are too complex, or of subpar quality.
Products or services: Your product or service should help the customer accomplish a specific task.
Gain creators: Your product should seek to create gains for the customer, such as providing the highest quality product for the lowest price.
Pain relievers: Your product should seek to relieve pains, be easy to use, and reliable.
The value proposition canvas is the best way to see how you’re meeting your customer’s needs with your product. This tool is also useful during product creation because you can map out the customer journey first, then use that information to align your product or service to their needs and expectations.
After you’ve mapped out your value proposition canvas, you’ll have a solid idea of how your product features meet the needs of your customer. But because you can never do too much analysis, here are more questions from Harvard Business School that you can use as you brainstorm possible statements with your team:
Which customers are you going to serve?
Which needs are you going to meet?
What relative price will provide acceptable value and profitability for the customer?
The unique question here is analyzing the price point of your product. HBS explains that price can be an important factor for your value proposition, depending on your target audience and what needs you’re trying to meet. While companies like Apple place more emphasis on product quality and service, other companies like Walmart rely on low prices to bring in business.
Many business leaders have created formulas to make value propositioning easier. Once you know your customer and your product value, you can input your information into these formulas and the result will be a succinct and powerful statement to your audience.
Steve Blank’s formula: We help [target customers]do [customer need] by offering [product features and benefits].
Cooper & Vlaskovits’ formula: [customer] with [customer problem]. Our [product] offers [customer solution].
Geoff Moore’s formula: For [your target customer] who [need or opportunity] our [product or service] in [product category] that [product benefit].
An SEO company may use the slogan, “We help others find you.” But when using the above formulas, their value proposition could read something like this:
Example 1: “We help businesses get seen on the SERPs by offering a user-friendly content optimization tool.
Example 2: “Get seen with a content companion that makes SEO simple.”
Example 3: “For businesses who struggle to understand Google algorithms, our user-friendly content optimization tool makes SEO simple so you can rank in the SERPs.”
Use the free value proposition template below for each of these formulas.Free value proposition template
Here are some examples of companies and their value propositions. Many companies use a version of their value proposition in their tagline, but if you go to their website’s homepage, you’ll learn even more about the value they offer.
Another strategic place for companies to display their value proposition is in the sub-headline on their main landing page. After a short and punchy headline, a sub-headline can be a great place to elaborate on what problem you hope to solve for your customers. Look below.
One version of our value proposition is, “Asana helps cross-functional teams overcome their organizational growing pains and ensures that goals, processes, and collaboration can continue to scale.” One thing to note is that you don’t have to stick to a single value proposition as long as you stay consistent with your messaging.
If you check out Pinterest’s About page, you’ll find a value prop that says, “Welcome to visual discovery.” Their sub-headline expands on the message by tying in the idea-based function of their discovery platform. It says, “When it comes to a great idea, you know it when you see it.”
On the Pinterest homepage, they use visual elements to give you a teaser of how the platform looks once you sign up. It prompts you to scroll down as images appear, tempting you to dive in.
Spotify keeps their message simple with three large words displayed across their homepage: ”Listening is everything.” In the sub-headline, they elaborate on what their platform provides by saying, “Millions of songs and podcasts. No credit card needed.”
You can find different versions of their value proposition on other parts of their website. For example, on their Contact page, it says, “Soundtrack your life with Spotify. Subscribe or listen for free.”Read: 5 tips to set great company values that reflect your unique culture
You must set yourself apart if you want to build a strong customer base. When creating your value proposition, remember to point out the needs of your audience, show what you have to offer, and explain how you’re different.Free value proposition template