In the previous post, we looked at the importance of VALUE and what is VALUE SELLING.
Let us now understand what is VALUE PROPOSITION?
Jill Konrath, sales strategist, speaker, and author of books like “Selling to Big companies” and “SNAP Selling” defines this very nicely as below:
“A value proposition is a clear statement of the tangible results a customer gets
from using your products or services. It’s outcome focused and stresses the
business value of your offering.”
It is a statement that summarizes why a customer should buy a product or use a service. This statement should convince a potential consumer how one product or service can add more value or better solve a problem than other similar offerings.
Customers are not interested in the product or service per se; they are interested in how it can help their business and what difference it can make. A statement that clearly communicates this aspect is a VALUE PROPOSITION.
Where and why do you use/need a VALUE PROPOSITION?
It can be used in all your marketing communication, websites, presentations, emails, and telephone interactions.
It is necessary because it opens doors. People are busy and they need a strong enough reason to give you time over telephone or in person. A strong value proposition does exactly that. It opens the doors of potential customers for you.
Generating a VALUE PROPOSITION
Jill Konrath recommends 3 basic elements around which a value proposition is to be crafted.
1. Business Drivers
These are the primary reasons why customers would engage with your product or service. These are their pain areas or aspects that they care about.
Examples are: market share, profitability, customer retention, collection etc.
As a sales/marketing person, “status quo” is your biggest roadblock. Customers will change only when they are convinced that your offering helps them be significantly better in comparison to their present position. A strong value proposition should include movement.
Examples are: Increase, decrease, improve, enhance, maximize etc.
This is about how the results are measured. It makes the offering more believable and stronger. It is recommended that exact numbers be mentioned, without any rounding up.
Examples are: Time frame, rupees/dollar value, percentages
Finally, how do you build a VALUE PROPOSITION
To build a strong value proposition using the 3 elements discussed above, we need data. Many a times, getting this data could be challenge.
Jill recommends 3 approaches that can help us get data:
1. Ask your customers
Your existing customers are the ones who have benefited by using your product or service. Prepare a structured questionnaire, seek their time, and request them for inputs. It is possible that they may not have all the answers, but at least they can get the relevant information and share with you after some time. Have patience!
If you work with large organizations, it is better to seek the inputs from people at different levels and functions to get a well-rounded perspective.
2. Ask your colleagues
It may sometimes be exceedingly difficult to get the data from customers. In that case, you may brainstorm with your colleagues. Collectively, you all may have lot of information that can be used to build a strong value proposition. Keep asking “so what?” till you get tangible results.
A word of caution here – do not rely on internal sources alone, get the data validated from customers as soon as possible. Finally, it is the customer’s perception that is going to matter.
3. Use Industry Statistics
In a situation where the first two approaches do not yield any results, get hold of industry statistics to support you. These may be available with management consulting companies or research firms that specialize in your chosen industry. A simple search on the internet might also suffice.
Once you are ready with your value proposition, get comments & feedback from others. What do they think? Is it strong enough? Can it be improved further?
Ensure that your value proposition is always updated and relevant to the needs of your potential customers.
To your success!