Last week, we talked about the first part of the business concept: The question, “Who will buy?” Today, let’s talk about the value proposition and the compelling story.
The value proposition is a clear statement of the benefits your customer will get from your product or service. It should explain in about 10 words or less why the customer should do business with you. This reason usually involves achieving a dream or solving a pain. The more specific you can make your value proposition, the better.
Before we look at what makes a great value proposition, let’s look at three weak ones.
- “We make your life better.”
- “Our products were rated best by our customers.”
- “This is the best system on the market today.”
You’re probably saying, “Yeah, so what? A hundred companies can tell me that.” That’s how most people react to a weak value proposition.
So how do you create a strong value proposition? You should deliver actual promises to the customer, like increased revenue, decreased costs, improved health, improved efficiency, fewer errors, unique solutions in less time or better customer loyalty. These are the clearly identifiable things that will actually benefit your customers, and the reasons they’ll be drawn to your business.
Examples of effective value propositions include Wal-Mart’s “Everyday low prices,” and MasterCard’s “For everything, there’s MasterCard.” These demonstrate the value and benefits these companies promise to offer.
The compelling story
No value proposition is complete without a compelling story that’ll make people sit up and take notice of your business. A strong value proposition identifies the need in the marketplace that led you to start your business, and offers your solution to the problem. When you have a clear understanding of the value your customers will get, and a background story that’ll appeal to them, you can really help your business stand out from the crowd.