How to define a value proposition – table of contents:
What is a value proposition?
A value proposition is an essential element of a product strategy. This is a concise and clear statement that explains why a customer should choose your product or service over other ones available in the market. It is not only informs them about the benefits of your product but also highlights the distinctive features that set it apart from the competition. Defining and developing is essential not only for effective communication within the team and with customers but is also a powerful tool for building a strong brand.
Unique value proposition vs value proposition
Although the terms are often used interchangeably, there is a slight difference between them. Both terms refer to the value a customer receives, but one can be shared by competing products. For example, Zoom, Google Meet, Skype, or WhatsApp offer easy-to-use video conferencing tools.
A unique goes one step further highlighting the unique features that set a company apart from its competitors. Accordingly,
- Zoom – offers three primary: accessibility, performance, and brand/status,
- Google Meet – offers calls for everyone on any device,
- Skype – emphasizes excellent call quality, and
- WhatsApp – focuses on the privacy of video calls.
Each of these statements emphasizes a different value important to customers – a single platform for various purposes, multi-platform availability, high video resolution, or security concerns.
How to define a value proposition?
It requires a deep understanding of your product or service and an in-depth analysis of the market. However, identifying unique benefits that you can offer is just the beginning. It is also important to grasp what is important to your customers, what their priorities are, and what they truly value in the product or service they are looking for.
To create an effective value proposition, you must get to know your customers and identify their needs, as well as the problems that your product or service solves. Market research and direct contact with customers may give you valuable information. It’s also essential to define your added value and how you stand out from the competition. It should be clear, concise, and easy to understand. It also must be tailored to your target customers to effectively speak to their needs and expectations.
Testing and validating your value proposition
It isn’t static. It should evolve along with your company, market, and customers’ needs. Therefore, testing and validating it is essential. The process may involve:
- gathering and analyzing customer feedback,
- conducting market research,
- A/B testing.
These will help you better understand what is already working well and what still needs to be improved in the product, or in the way it communicates with its users. Continuous refinement is the key to staying competitive in the market, making the product not only good but one of a kind.
How to present it on a company website?
A company website is one of the main places where you present your value proposition to customers. This is where they go before making a purchase. Therefore, it is crucial to formulate it clearly and convincingly. It’s also worth adjusting it to the design of your website. It may seem counter-intuitive, but it is better to focus on one feature of your product here than to give the customer an overly long text to read.
Defining and developing a value proposition is a key component of any company’s marketing strategy. An effective helps attract and retain customers, sets you apart from the competition, and builds a strong brand. Remember, however, it isn’t something permanent. It should be constantly monitored, tested and adapted to changing market and customer needs, as well as to the way the product evolves.
- Intro to product management
- What is the role of a product manager?
- Why is product lifecycle management important?
- How to build an efficient product strategy?
- OKRs vs SMART goals. Which framework drives better results?
- How to define a value proposition?
- Identifying customer needs and market segmentation
- Crafting a winning product concept. Techniques and steps
- Gaining an edge with an effective product roadmap
- Prototyping your digital product
- How to build an MVP?
- MVP vs MMP vs MMF. Key milestones in product development
- Mastering hypothesis testing
- Proven methods for improving product quality management
- Strategies and tactics for a successful product launch
- Driving profitability through product optimization
- Measuring product success
- How to price a product? The most popular pricing strategies
- The future of product design. Top trends and predictions
- When to retire a product? Key factors influencing EOL decisions
- Agile in product management
- Scrum and Kanban in product management.
- What is lean product management?
- Jobs to be Done. Creating products that customers truly need
- What is growth hacking?
- What is data-driven product management?
- A/B testing in product management
- Useful product management templates. Where to find them?
- Strategyzer tools in product management
- 5 useful product management tools
- How to create and manage product documentation?
- 6 essential tools for product managers
- How to use AI in product management