How To Create An Outstanding Value Proposition For Your Company?

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How To Create An Outstanding Value Proposition For Your Company?

Posted by: Sonya Trivedi
Category: Get insights

Ok, you have made your first steps toward creating your own startup. The idea is already decided, you have your website and a small team that is ready to embark on this adventure with you. Your buyer personas are also well thought of, but how are you going to approach them is still a mystery. Let’s talk about a little something called “value proposition”!

Many entrepreneurs fail to define an appealing value proposition that can be useful for their business to move ahead.

So, What Is A Value Proposition?

This is the one most important statement that sets out the difference between you and your competitors and makes you stand out.

Investopedia defines a value proposition as the business or marketing statement that the company uses to summarize why a consumer should buy a product or use a service. After reading this statement, the potential customer shall understand how exactly your company would offer them the value they are looking for.

First, Define The Main Problem You Are Solving!

To best define your value proposition, the first prerequisite is to know your target audience very well. You should be able to identify their problems crystal clear. If you are solving a significant problem, this means that you will also have a significant opportunity ahead of you. Michael Skok explains in an article by Forbes that when you think about the problem, you will come to a theory that it is called 4Us

Each problem that you will encounter would be either unworkable, unavoidable, urgent or underserved.

  • Unworkable are problems that fix a broken business process. If your startup is solving such а problem, you will have to know what are the real, measurable consequences of not acting properly.
  • Unavoidable are problems that are associated with the governance and regulatory control. Here you will always have a real need and a market for dealing with such problems. For example, dealing with taxes is an issue that can’t be underestimated, hence, companies dealing with taxes would need some support.
  • In addition to unworkable and unavoidable problems, there are also problems for the company that are really urgent. These are usually issues that are a company’s first priority and if you have a solution for that, you will definitely grasp their attention.
  • Many problems can be neither urgent, nor unworkable or unavoidable, but just underserved. This would mean that there is no adequate solution for them. Your startup can thrive in this environment by being innovative and different.

 Defining the problem you are solving is a great starting point as this would create a higher demand as well. How should you continue after this?

Steps To Create A Great Value Proposition

According to HubSpot, there are five major steps to create an appealing value statement:

  1. Identify all the benefits your product offers.
  2. Describe what makes these benefits valuable.
  3. Identify your customer’s main problem.
  4. Connect this value to your buyer’s problem.
  5. Differentiate yourself as the preferred provider of this value.

Each prospect has the following motivation equation in his mind when buying a product or service.

Motivation = Perceived benefits – Perceived costs.

Hence, make sure that you cover this equation before you proceed to the next step.

Check out some more great value propositions here and fine-tune your own statement.

In a world where marketing creates a lot of noise, brands should be careful and should find their best opportunities to become outstanding. Value propositions are one of the ways to get there. So, know your audience and transfer clear and understandable messages to them. Doing this you shall be walking the path to success.

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