Getting your value proposition right
Alexandra Fulford
Creative Thinker, Storytelling Coach, Healthcare Social Media Strategist & Trainer, & Autoimmune Patient Advocate
As a business storytelling coach a key step I take my start-up clients through is looking at their value proposition. Working with my pharma clients this is something I rarely have to do - pharma brands generally already have a clear value proposition, developed by the global team. For a start-up however it is a critical step and vital for investor pitches and building the business.
What is a value proposition
A value proposition, as suggested by the name, is the unique value that your product or service brings to your customer. "Unique" and "value" must go hand in hand. If you offer something unique but there is no value in it for the customer you will fail. Similarly if you offer value but it is not unique you will struggle.
Your value proposition is a short clear statement that clearly communicates what this unique value is for your customer. It is used for marketing materials, investor pitches and sales. A value proposition should answer the question" what exactly does your brand / company / you do?"
How to develop a value proposition
Developing a great value proposition is not an easy task. Personally I find the hardest part can be communicating the uniqueness in a succinct way. It is easy to explain why your offering is the best if you can write a few paragraphs or do a full deck with all the details. However conveying this is a single sentence that stands out is difficult (for many offerings at least). So where should you start?
Understand your customers
Like all things in business you should start with a great understanding of the customer. What are their needs, and what problems do they need to resolve? Harvard Business School calls it the "jobs to be done theory". The assertion is that customer's use products and services to get "jobs done" rather than because of their attributes or set buying behaviours.
Understanding this nuance is highly valuable for a business. There are plenty of examples where businesses have created unique and new value through framing their customer's problems like this. By looking at what it is your customer needs "to get done" you can frame your proposition in a way that "gets the job done".
Understand your competitors
If you want to show how unique you are then you have to understand what your competitors are offering. When you do your competitor analysis you want to be thorough. Look at not only product attributes but also how your competitors are communicating that, what else are they offering, how are they differentiating themselves. With this you can then identify what you need to be different and how you can communicate your uniqueness.
You should also understand who all your potential non-direct competitors are. There are plenty of value proposition frameworks out there but not all of them include "substitutes". This is actually part of Porters Five Forces - another useful framework to look at if you are setting up a new business. If you also consider the broader market including substitutes you may find a unique value you could offer that covers something more than your competitors. You may also shore up your business for future competition from these substitutes.
Understand your product
Understand your product may sound obvious but sometimes founders go down rabbit holes or are so passionate about what they do they forget to understand their product ... from the customer's point of view. At this point it is worth taking a structured approach. Make a list of all the benefits your product or service offers. Look at these from the customer's point of view and explain how each benefit brings value to the customer and what "job it gets done". What specific pain points does your product alleviate or what "itch" does it scratch. Passion is a great asset in business but at this point you need to be as objective as possible.
Develop your value proposition
The final step in the journey is to then craft your actual value proposition. Looking at all the work from the previous steps identify the gold nugget that is your unique business, from your customer's point of view. What is it that you do for them.
A good value proposition should be:
Once you have your value proposition test it out. Speak to some of your target audience and find out if it resonates. If need be tweak your proposition. With time, and as your business evolves you may need to re-evaluate your proposition.
How to use your value proposition in business storytelling
When you develop business stories you will always have a goal - something that you want to achieve by telling the story. For Start-ups this will often include convincing investors to invest, or to encourage customers to use the product or service. In order to do this you need to have a great idea of all the elements mentioned above.
When it then comes to crafting a relevant business story you can take these insights and use them to select the right story for the right audience. You can also weave elements of the value into your story. You may, for example, use the story of a previous client. Detailing the "jobs to be done" or their challenges, you could then explain the unique thing you provided, and the great end result. Your actual value proposition is something you could mention either at the very beginning or at the end as a conclusion. While your value proposition itself will not change the insights and elements for your story will based on your target audience.
Developing a great value proposition is an important task, but it is not an easy task. It will often involve multiple iterations and time. One final recommendation I have to make things easier - use GenAI tools! You can use ChatGPT, or a similar tool, to get you started on your competitor analysis for example.
You can even ask the tool to generate the actual value proposition for you. I would suggest you then tweak and amend to make it truly yours - give it that personal touch. As you go through the process take on board everything you learn - this will stand you in good stead as you progress along your business journey.
If you are a Start-up or business in need of support or business coaching then please get in touch [email protected]