A value proposition is a promise of value to your customer that they will receive upon using your product or service. It is a big part of successful business strategy that outlines the reasons why a prospective customer should do business with you.
Developing a value proposition involves analysing the benefits, cost and value that your product or service can deliver to your customers. It should make the benefits of your product or service clear and explain why prospective customers should do business with you instead of your competitors.
Features of a great value proposition
A great value proposition example will always be clear, with the message being concise, easy to understand and communicating the benefits of your business. The message should define what your business does and how it benefits the customer, as well as making it easy for them to find you online. Explain how your business solves a problem for your potential customer and why they should choose you over your competitors.
Your value proposition should also feature prominently wherever prospective customers may encounter your business. This certainly means your website but will also include social media platforms and advertisements.
As you can imagine, writing a concise value proposition takes some skill. Many businesses don’t even identify what their value is, let alone how to express it effectively.
Common value proposition mistakes
Many businesses botch their value proposition by littering it with ineffective buzzwords or slogans that make little or no connection with a prospective customer. A lot of these types of so-called value propositions are nothing of the sort, and do not even highlight the actual benefits of a business or why anyone should choose them over a competitor.
Another common error is the baseless boast. Claiming to be the best on the market, or that your product is the easiest to use etc, can only work for you if it is demonstrably true. If you are going to make a bold claim, then make sure you have studies or customer testimonials to back it up.
One less obvious mistake that is often made is the failure to test different value propositions once they have been created. Simple A/B testing can reveal which value proposition out of two seemingly good ones will result in the most conversions on your website.
Writing a great value proposition
Writing a great value proposition is all about finding the balance between what your company can do for the customer and why the customer should do business with you. You must know which customers you want to target and what needs of theirs you are going to meet. Also consider the pricing of your product or service and how this offers acceptable value for prospective customers.
To achieve this you must identify the key benefits and features of your product or service, and understand how the experience of doing business with you will benefit the customer. Correlate this information with the needs of your ideal customer, as well as their desires and fears. These elements will combine to give you the foundation of your value proposition.
Finally, you will want to distil your message into a simple statement that declares what you will do to help your target customer and how you will do it.
We can help
Writing a great value proposition can take time and skill. For advice on this and other financial matters, get in touch with our financial experts. Find out how GoCardless can help you with ad hoc payments or recurring payments.