Your customer value proposition (CVP) forms the backbone of both your business and marketing strategy which means that defining it should be your number one priority.
What does a value proposition mean?
Simply put your CVP is defined as the promise of value your customers will receive in choosing your product or service. The Wikipedia definition states that “a value proposition is a promise of value to be delivered, communicated, and acknowledged. It is also a belief from the customer about how value (benefit) will be delivered, experienced and acquired.”
The key thing to remember is that it is customer centric, brings your customers into the heart of your marketing strategy and helps you propose solutions from their point of view. It gives prospective buyers a reason to become a customer and highlights a benefit that sets you apart from your competitors.
Challenges for marketeers in developing value propositions
It’s easy to be passionate about your business and natural to want to shout about it, so marketeers need to be careful not to overload their proposition with features and benefits. It should not be used as a platform to brag about your unique products and there is no room for hyperbole. Claiming to deliver “the best CRM software in the world” means nothing to your customers and is not a value proposition.
It is a common misconception that value equates to the lowest price. Business decision makers, as consumers themselves, have been encouraged by retailers to think in this way. It is the responsibility of B2B marketers to change this mindset and move beyond price as a differentiator. Price cutting may serve to undervalue your product in the eyes of your consumer and could lead to a price race to the bottom. In many business sectors however, the decision maker is unlikely to mistake value for price. Understanding the complexities of in their decision making will help to shape your value proposition.
Without using price as your most obvious differentiator it leaves room for ambiguities for marketeers to fill in building a clear CVP will help you to do that for your business. It is essential that you’re clear on what form value is going to take before you can determine if your proposition will resonate with your customers; let alone communicate it to them effectively.
Why is it important?
It puts clear blue water between you and your competitors, creating a strong differential and efficiently communications your USP. In other words, it tells the customer exactly why they should buy from you and not someone else.
It offers a short cut for customers to understand what you are offering. It can be difficult to get a customer’s attention, let alone to keep it. With so much information at their fingertips, customers will use short cuts to quickly eliminate “noise.” A clear and compelling CVP will help your customer to understand quickly that you can meet their needs.
It builds trust and engagement. Communicating a powerful value proposition to your customers will help them to truly understand the benefit your products or services brings and the value it delivers for their business. This level of understanding will foster trust and future engagement with your brand.
It offers clarity of communication and makes it clear to customers why they should place value in what you offer. It acts as an anchor throughout all your communication channels: website, email, blog, social media etc.
Forward-thinking businesses seek to future proof their brand and focus their overall strategy around a clearly defined customer value proposition. Customers should feel as though they have received a good deal, while businesses should charge the highest price without compromising this. A marketeers challenge is to define that value and communicate it in such a way that it is perceived as a good fit for their target customer.
What makes an effective value proposition?
Keep it Simple
This is far easier said than done. Many people can explain what their company does in multiple paragraphs and succeed in communicating true benefits but who’s going to read it on spec? Make your value proposition simple, clear, and credible.
Keep it Relevant
A good value proposition looks through the lens of the customer and speaks to the benefits that THEY will receive if they choose your product or service. It speaks to a specific customer need and addresses a problem it will solve for your buyer.
Keep it Unique
As the proposition is written with your ideal customer in mind, it should be clear to them why they should choose you over a competitor.
Keep it Real
An effective value proposition should be verifiable and avoid making hyperbolic claims that any other provider could make. They are meaningless and a waste of time.
A personal favourite of mine, albeit from the B2C world, is from Duolingo:
Learn A Language Free. Forever.
It simply and clearly communicates the key value proposition to duolingo users; that the service remains available at no cost, providing quality language learning resources completely free of charge.
How can SOLV help?
A well written and clearly communicated value proposition has enormous potential to help your business attract the right kind of customers. Delivering an effective CVP however is much easier said than done; it is time consuming and very challenging.
At SOLV we have over 15 years’ experience delivering strategic marketing and CVP to a number of organisations both big and small. We would be happy to have an exploratory call with you and suggest a bespoke approach to CVP creation that’s right for your business. Simply click here to get in touch.