… And How to Fix a Promise Gone Bad
Competition for the customer’s attention is central to marketing. But analyst firm Gartner cites that “most value propositions fail to stand out in the market place.” Where are so many of us going wrong with a cornerstone of marketing that impacts the customer experience?
Understand first that a value propositon is an offer to engage in a business transaction or relationship between your company and your customers. It is not a list of product features but is a statement of how you uniquely add value to your customer.
The first trap is that our marketing centers around the features built into our products or services. This “I am important” way of thinking rapidly takes most brands into the tube of product-centric indifference.
The second trap is to think of a value proposition as a tag line. Snappy. Clever. Usually saying nothing important to the customer. I am not saying a tagline should not be used. I am saying that a tagline should not be confused as being a value proposition that communicates how you uniquely serve your customers.
The third trap is not delivering a complete proposition. Too often, the proposition fails to deliver metrics that enable customers to quantify how the brand benefits the buyer. A Gartner survey validates that prospects are 2.5 times more likely to purchase if the marketer quantifies its value proposition.
Given the probability that prospective customers are unable to see the difference between similar brands and how they provide value to the purchaser. Too often, value propositions are focused on what the brand does than what value they provide to the customer.
A System for Getting Out of the Brand Trap
The concept of “value proposition” means what it says: value + proposition. The two need to be joined. The value proposition should be considered a promise you are making to your customers. It should show how you are different, it must be honest and it should hone in on how you deliver quantifiable value.
Analyze how you stack up of features that bring value to customers. Build a chart showing how you compare to your competitors when it comes to value for the price charged. If you merely meet industry standard specifications, you will be perceived as a commodity and will have to sell at a low price. If you can quantify your value proposition based on the business outcome, you can likely charge a premium price.
What will it take you to go beyond meeting standard specifications to a position where you are delivering value?
Put yourself in the shoes of a buyer.
Think back when you made a major purchase — a new refrigerator, a computer, a car. What was the thought process as you considered the options. At some point after looking at different refrigerators sold at different appliance dealers you decided one dealer selling the refrigerator you wanted had the best offer. That dealer took the time to understand how you would use the refrigerator and where he could create the best value for the money … the most reasonable price, the best warranty, the best delivery … things other dealers were unwilling to offer you.
Now flip yourself back out of the customer’s shoes and think about how your prospective customers are going through a similar process when they are looking at your offering. Can you see how they will use your offering and how they will get value from purchasing your offering rather than a competitor. Is your value proposition dramatically clear to them?
First, describe how you provide superior value to the customer. Second, quantify the outcome you deliver. Third, communicate this valued outcome relative to competitors.
- Do not talk about being “the leading provider in your industry” — what value does this provide to a customer?
- Do not talk about how long your company has been in business — what value does this provide to a customer?
- Do not think that writing a clever tagline is a value proposition — what value does this provide to a customer?
I recently worked for a clinical consulting firm that provided process improvement services to hospitals. The value proposition that we developed was clear, simple, honest, different and provided quantification of the value to hospital executives:
We help you deliver safe, quality healthcare while reducing expenses by 3 to 5 percent, so that you can increase financial stability or add new revenue-generating capabilities at your hospital.
This value proposition drove how we designed our services, how we delivered our services, the kind of content we put on our website, blogs and social media. It was foundational to everything. And, yes, it drove our tagline: The Better American Hospital. The value proposition came first, then the tagline.
What do you do to provide superior outcomes for your customers that they cannot get anywhere else? How can you create the perfect customer experience?