The dream of every entrepreneur is to have a sustainable growth rate for his/her business. While it is one thing to have an awesome business idea that shows great prospects, it is another thing to actually have the courage to launch out there and yet another thing to maintain the growth of the business. The world today revels in the era of value. Every customer who is first and foremost the hub of any business wants to be accorded the gift of quality products and excellent service in exchange for patronizing any business. However, the first thing that attracts customers to your business is the answer to the question, “what you are actually selling to them?” In other words, what is your business message to the world that can guarantee you an influx of loyal customers? How do you convince people that the product or service you offer is the much-needed solution to their needs? How do you win over customers and persuade them to patronize your business? This you can achieve by having a solid VALUE PROPOSITION.
Every business should have a business statement that gives a summarised outline of what the business is about and why a consumer should patronize it. The promise of good quality service you make to your customers on a daily basis, otherwise known as a business statement, is called a value proposition. A good value proposition explains the reasons why a customer should leave the competition and come for your products or services. It sways customer over to your side by assuring them that the product or service you offer will better suit their needs than those from your competitors. It explains what benefits you provide, who you provide it for and how uniquely you do it. Using a solid value proposition, you are able to define the right target audience who stands to benefit most from whatever products or services your business offers. This gives your company a unique competitive edge over other companies in the same niche and coining a term from this, Warren Buffett, a renowned investor and executive at Berkshire Hathaway, calls it an economic moat. Your business can have a high sustainable competitive advantage if you have a very extensive or comprehensive moat and you can get this by having pricing power, developing your brand to make your business known, and a large portion of market demand.
Examples of companies with awesome value propositions are
- Uber – The Smartest Way to Get Around
- Apple iPhone – The Experience IS the Product
- Unbounce – A/B Testing Without Tech Headaches
- Slack – Be More Productive at Work with Less Effort
- Digit – Save Money Without Thinking About It
- LessAccounting – Bookkeeping, Without the Hassle
- CrazyEgg – Website Behavior Tracking at an Unbeatable Price
A great value proposition should be brief, intuitive and at the same time appeal to the strongest decision-making instincts of a customer. Dianna Booher said, “If you can’t write your message in a sentence, you can’t say it in an hour”. It should in clear terms state the value your business offers by explaining how your business solves a need, why it is better than similar products in the market or how it offers a better service and going a step further, it should also state the added benefits your business offers that your competition doesn’t have. One of the ideal places to display the value proposition of your business is on your website, as every business is expected to have a website which gives the brand a web presence. Bill Gates said, “If your business is not on the internet, then your business will be out of business”.
How can an entrepreneur maximise the strength of a compelling value proposition?
- The first thing to consider when developing a value proposition is to DEFINE THE PROBLEM YOU ARE SOLVING. Most entrepreneurs are often tempted to dive head-in to solutions without first shedding light on the problem for which their business proffers a solution.
- Have a great headline: An amazing value proposition has a bold, catchy, short and interesting headline that immediately communicates the value the consumer stands to benefit from your business as seen in the examples above. The headline should be a sentence that easily sticks to memory. It can be a phrase or tagline. Avoid the use of meaningless slogans or buzzwords. You can also have a sub-headline, a short paragraph, about 2 – 3 sentences, below the main headline which explains more on the kind of value your business offers and can also give an example of why the product or service you are offering is better than those of the competition. This gives an insight into the specifics of the services you offer – who they are for and why they are special.
- Be benefit driven. Utilize the magic of bullet points as you highlight the key features or benefits of the product or service you offer. With the use of powerful words and language structure, you can nail the interest of customers and keep them hooked in your business.
- Clarity is key in a good value proposition so that you don’t lose the interest of customers as they are trying to figure out what your business is all about. Having this at the back of our minds, it is advisable to develop a value proposition which is easily readable and understandable within 10 – 20 seconds.
- Make the most of great visual elements. The images used in your value proposition should speak volumes about the message you are trying to pass across. After all, a picture speaks a thousand words.
- Have a compelling Call-to-Action (CTA) button that reels customers in. This is one of the deciding factors for the visitor to click and convert to a customer or go away.
Value propositions are quite unique for different businesses and its customers, hence, they follow different formats. Be that as it may, all effective value propositions should follow the above rules as they are basic tenets in the development of good value propositions. If you don’t already have one, develop a solid value proposition for your business as it makes you stand out from the competition.