What is a Value Proposition?

So, What is a Value Proposition?

What I’m about to tell you might sound familiar (if you read our blog How to Write an Awesome Mission Statement): Google and the interwebs in general cannot seem to solidly agree on a definition of Value Proposition. There is, however, a general consensus that a Value Proposition is different from a Mission Statement. And it is.

 

In the simplest terms, in the most convenient definition…
 

A Value Proposition is a brief but informative statement
that defines your company’s unique selling point.
 

  • It should clearly communicate to potential customers how your product or service handles a specific need, or pain point.

  • It addresses how your company’s product or service is better than the competitors.

  • It should be compelling enough to guide your potential customers’ decision-making process.

  • It should be concise, meaning no longer than a short paragraph, with 1 to 2 sentences being the ideal length.

 

Just to refresh your memory…

 

A Mission Statement is a brief but informative summary
of a company’s overall objective.
 

  • It addresses what that company does, why they do it, and who they do it for.

  • It should be easy for everyone involved in the company to remember and repeat.

  • For your customers, it should resonate as informative and true.

  • It should be concise, meaning no longer than a short paragraph, with 1 to 2 sentences being the ideal length.

 

While the Mission Statement defines what a company does, why they do it, and who they do it for, a Value Proposition details how a company does what they do better than anyone else.

 

The single best way to fully explain what all of this means it to take a look at an example. And after extensive and sometimes boring research, I found one. I came across an article on marketingexperiments.com titled, 6 Good (and 2 Bad) B2B and B2C Value Proposition Examples. Author Daniel Burstein does a great job of showing how a Value Proposition can be a condensed version of all the amazing reasons why potential customers should choose you.

 

Here is his breakdown of the PR Newswire Value Proposition {with some notes from me}:

 

PR Newswire has the most (1.) established and (2.) largest news distribution network in the industry, enabling you to (3.) more reliably reach your target audience.

{Each of these 3 points is addressed individually and more fully in PR Newswire's marketing material. The full statements are as follows:}
 

  1. Industry leader for 59 Years. Established relationships with major news sources such as: Yahoo!, MarketWatch and New York Times.

    {The shortening of this to “most established” is a clear statement about how PR Newswire stacks up against the competition.}

  2. Distribution to over 200,000 media points and 8,000+ websites, dedicated journalist website with 30,000 active members per month, 150 mobile apps that carry PRN content (broadest in the industry).

    {Like statement 1., statement 2 being shortened to “largest news distribution network” results in a more simplified way of conveying superiority over the competition, and the two together convey superiority in both experience and resources.}

  3. PR Newswire provides flexible and cost-effective distribution options to help you reach niche markets across the U.S.

    {While the shortening of this statement leaves out reference to the cost-effectiveness, which can be a pain point in its own right, PR Newswire decided that directly addressing the reliability of reaching a target audience was a more important aspect of the service they provide. It may be that other cost-effective options are available to potential customers, but none of them offer the same level of reliability in reaching a target audience.}

 

The idea here is that the Value Proposition provides ALL 3 of those points in 1 concise statement that you can easily present to potential customers. Once you have their interest, a person or a website (or any form of promotional content) can do the heavy lifting of further communicating the details of each point.

 

So, how to do write a Value Proposition?

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The stages of writing your Value Proposition are very similar to those for writing a Mission Statement, with the minor difference that you should not avoid bragging. You should step right in a big ol' puddle of bragging, then leave your wet footprints all over the places where your potential customers hang out so they can follow the trail back to the incredible product or service you have for them. 

 

Step 1 Brainstorming


The most critical brainstorming questions for writing a Value Proposition are:
 

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  • Who are your potential customers?

  • What is the problem for which you are providing a solution?

  • What is the uniqueness of your product or service? What do you offer and how do you do things in a way that sets you apart from similar businesses in the industry?

  • How are you better than the competition?

 

Step 2 Compiling it All In to One Statement


Just like writing your Mission Statement, follow these suggestions when whittling your brainstorm mess down to a short statement.
 

  • Steer away from a statement with a big idealistic vision that isn’t rooted in anything concrete, like “We aim to achieve world piece”. Remember to keep it simple and honest while focusing on the exact purpose of your product or service and the value provided to your customers.

  • Leave out the fluff. Stop with the buzzwords that create the illusion of intelligence and meaning but ultimately express nothing, or at least nothing that anyone can understand. Be direct and use straightforward language, unless your boss is Jack Donaghy, cause that guy is known for saying things like, “We have to synergize backward overflow.” He’s a jargon lover.

  • While making sure your statement doesn’t run on too long – no longer than a short paragraph – don’t forget that it needs to be easy to remember, repeat, and showcase.

  • Building on the previous suggestions, remember to ensure the language and composition of your statement reflect your company’s personality and style AND speaks to your potential customers in their own language.

Unlike writing a Mission Statement, a Value Proposition is the perfect place for these two things:
 

  • Bragging and Boasting! There are plenty of places to show off awards and other accolades, but your Mission Statement is not one of them, as your mission should not be to win awards. Your Value Proposition, however, is the place where you can and should mention all of the incredible things you've done and achieved so as to win new customers. Listing your awards would be boring, but referring to your company as "Award Winning" is a worthy acknowledgement.

  • Company history! No one is suggesting that you try to detail the history of your company in just a few sentences, but mentioning that you're well-established, or specifically saying you've been in business for 25 years is a great way to let your potential customers know that your product or service is backed by experience and expertise.

 

Step 3 Refining and Finalizing the Statement


This is the part where you put together a test audience and take your Value Proposition out for a walk. Show it off to people whose opinions matter to you. Here are some critical questions to ask your test audience:
 

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  • Does this statement sound honest?

  • Is this statement informative?

  • Is this statement interesting and compelling enough for your potential customers to seek out additional information?

  • Does this statement convince your potential customers that you are better than the competition? That your product or service provides more value than competitors.

Finally, be honest.


If you followed the above suggestions, you will have created a statement that can be proven. If you say you’re the industry leader, you better be (and your definition of “industry leader” can’t be based on that one time you lead a horse to water and his name was Industry).

 

Your Value Proposition must be an honest statement about what you can do for potential customers.

Be truthful with them about the amazing things they can expect from your product or service.
Speak to your customers in their language so your statement will resonate with them
and convince them that your product or service is more valuable than anyone else's.