A useful value proposition formula

I didn’t invent the following – you’ll find it in lots of places on the internet – but I decided to re-share it because I’ve found it to be a useful tool in many B2B marketing cases…

First, an obvious introduction – why value propositions are so critical to marketers

Please forgive me this less than insightful introduction, but it is short and provides useful context…

You’ll have no doubt heard the expression that business is a value exchange. One party (the supplier) does something for another party (the customer) in exchange for something (usually money). Both sides are meant to get value from the exchange. The supplier’s ‘value proposition’ is a sales & marketing statement that summarises not only what benefits the customer will receive from that value exchange BUT ALSO why they should buy it from that specific supplier.

The reason why value propositions are such an important tool for us marketers is that, if you can’t clearly summarise your value proposition, how can it possibly be clear to your target customers why they should buy from you and not from that nasty competitor down the street? The value proposition is a pithy summary of why someone should do business with you.

A tool to help write a value proposition

While there is no mandatory, carved-in-concrete rule for how you should write a value proposition, I do think the formulas you find on the internet are a helpful place to start. Here’s one variation of the formula that I’ve used. The idea is that you fill in the blanks for your product or service…

  • We help [who, specifically],
  • that need [a solution to a pressing problem or concern],
  • to succeed by [what we will deliver],
  • so they will enjoy [benefits / outcomes / gains].
  • Our service is better than [named rivals]
  • because of [distinctive and highly resonant reasons],
  • as evidenced by [proof points / promises we will make / guarantees we will commit to]

Here’s a (semi-fictitious) example, from the world of fibre-optic telecommunications:

  • We help large-scale users of internet bandwidth, such as high-profile media companies, hosting providers and national telecoms operators,
  • that need highly dependable but also rapidly expandable, direct connectivity between their offices, studios, server farms and key customers in overseas locations,
  • to succeed by delivering same-week access to 10GB, fibre-optic-based connectivity between the world’s top 30 business markets.
  • Our service is better than DumbassTelco.com
  • because A) our service is entirely burstable – you only pay for the bandwidth you use; and B) because our service reliability is far superior – your end-users will be far more satisfied with the service,
  • as evidenced by our 1.5 hours or total outages last year, versus Dumbass’ 1.5 weeks of outages.

That example is semi-fictitious – I’ve been out of telecoms marketing for a little while and market dynamics continue to evolve (for example with the evolution of cloud computing and software defined networks), and I also wouldn’t put actual commercial secrets in a blog post – but I hope it serves an illustrative purpose. It is symptomatic of the types of things I’ve written and seen written in the past.

The harsh reality: value propositions are tough

While seemingly simple, the reality is that it is quite hard for many B2B marketers to write these value propositions. The reality, I know, is that many B2B products and services are quite similar. Unique Selling Points (USPs) are few and far between. My three typical responses to that inconvenient reality are:

  1. difficult though it can be, there really is nothing quite like having a go at writing a compelling value proposition for your product or service, to shine a bright spotlight on how strong – in reality – your offer is relative to your rivals. I strongly encourage all fellow marketers to try and write their value proposition on a semi-frequent basis. And if you write a good one, use it in your B2B pitches – it should serve you well;
  2. if your value proposition is weak, you really need to do something about it if you want to outperform the market (or even just deliver sustainable results). More often than not, that typically means developing your products (i.e. innovation) and/or carving out a defensible market niche to play in. (Or of course you could drop your prices, buy a competitor or get out of the market – but those are punchy options for most day-to-day marketers); and
  3. in the meantime (if your value proposition lacks real persuasion-power), make sure your branding and marketing promotions are more visible, more resonant and more memorable than your rivals – and hire the best sales people you possibly can. It is possible (although expensive over the long run) to create an aura of strength and desireability around a product or service that isn’t truly distinctive, for example via SEO, advertising, events and other sophisticated promotion – although you need to expect to be asked some difficult questions in pitches, and your ability to retain higher price levels will be put to the test.

Some possibly sobering thoughts there, but that’s why businesses need capable marketers. I certainly hope the formula above helps you as much as it has helped me over the years.



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