How to create the best value prop
Updated: Jun 21, 2019
Several years ago, I was sitting in the beautiful offices of a very well known Canadian retailer. They had a problem. They were spending a lot of money on their marketing efforts (money small businesses wish they had!), and the efforts weren't yielding results. Their target customer was aware of them, but she was not buying. For those of you paying attention to my previous posts, this is a middle funnel problem. There is awareness, but no interest. After working on the problem for some time, the issue became clear. It was their value proposition. Their loyalty program was too complicated and didn't address their target customer effectively.
How can you ensure that your value proposition effectively connects with your target audience? The single most important element of your marketing strategy is your value proposition and your positioning. If you get this right, your marketing messaging and communication strategy will resonate. If your valueprop is off, you run the risk of wasting precious time and resources on marketing the wrong message.
The good news is that there is a formula to create a perfect value proposition and a way to know if you've gotten it right. I've created many value propositions for small, medium and large businesses and there is a proven process that we go through that yields success. Below are the process steps:
1 - Gather customer intelligence. Understand what your target customers want and what is important to them. Formal surveys are best because they quantify the results. But if that's not possible, customer feedback can also be gathered by informal chats or interviews. Always try to ask the right questions and really listen to the answers.
2 - Analyze your targeted or current customers. Is your value prop the right positioning for them? For instance, if your target customer is affluent, your brand positioning should have a high-end communication strategy, as well as an affluent look & feel.
3 - Assess your customer pain points. Avoidance of pain is a significant driver of purchase. If you look closely, we buy a great number of things in order to avoid one pain-point or another. Think about how you are solving issues for your client and ensure you clearly articulate that in your positioning statement.
3 - Tap into emotional drivers. I cannot stress enough how important this is to the purchase decision. Even if you are a pure B2B brand, if you tap into an emotional driver of your end customer, your offer will resonate.
4 - Map the customer experience. Are you fulfilling your brand promise? For instance, if you position yourself as simple and easy to deal with, does every experience with your brand reflect that? I do mean every experience - website experience, contact process, purchase.
How do you know when you've achieved success? The perfect value prop has three elements: 1) It's relevant to your clients. It addresses what they need now, 2) It's differentiated. You don't just offer what everyone else in your field provides. You add value that your competitors don't, and 3) It reflects your strengths. It takes your differentiators and communicates them well.
The outcome? The retailer I mentioned had a clear understanding of where their issues were. As a result, they were able to funnel their marketing budget to where it had the most impact. How about you? Do you have a strong value prop and positioning that resonates with your target client? It's important to ask yourself this question. A strong value prop ensures that your marketing efforts aren't wasted and sets you up for success.
If you need help re-assessing your value proposition and positioning, please reach out.