The very concept of business itself is simple and straightforward: You provide a consumer with value of some kind and then they provide the business, in return, with compensation. A business cannot realistically expect to be compensated if they are unclear on the value they are offering or they are unable to articulate it.
That is where value proposition can help your business. A value proposition is a business or marketing statement summarizing why a consumer should chose your products over your competitor. It should convince customers that your product or service would solve a problem or fulfill a need better than what others are offering.
Does your business have a value proposition?
It is something your business should have in place. Small business owners should care about their value proposition because it is the foundation of their success, says Elijah May, managing partner of The Experience Firm. May goes on further to say the sad reality is that a huge percentage of businesses don’t really realize what business they’re in.
The more competitors are offering the same basic value as your business is offering in a given marketplace, the further the business needs to go make sure that their value proposition is unique. May shares these examples of Toms Shoes and Jimmy Choos.
Toms Shoes, for instance, offer the same basic value proposition as all other shoe companies: my feet are safer with shoes on. But what makes their product unique is that I am giving something to someone else when I buy it. It’s not so different from fair trade coffee in that respect. Other shoe companies offer the same basic value proposition of protecting your feet, but in the case of Jimmy Choos, for instance, they also raise your social standing. That is why you are willing to pay so much more for them … because significance and social standing have value.
How to make the unique value proposition work for your business?
In order to make a unique value proposition work for a small business, May says small businesses need to know basic human psychology. Pretty much all people have the same, fundamental wiring. May says that once you understand that nearly everyone is just trying to fill the same felt needs, then you can start to communicate directly and effectively how your business is going to meet those needs, and your business suddenly becomes far more relevant to the consumer.
To help people embrace this way of thinking and begin to describe what small businesses have to offer in a way that it will naturally spread, May teaches a class called “How to make your customer C.U.R.S.E.” Here is his thinking:
▪ If the don’t Care, they’ll never understand.
▪ If they don’t Understand, they’ll never remember.
▪ If they don’t Remember, they’ll never share.
▪ If the don’t Share, they’ll never engage.
▪ If they don’t Engage, they’ll never become part of a community that wants your business to succeed and is willing to expend time and energy to make sure that it does.
Anyone trying to sell a product of any kind needs to take the time to understand what specific emotional (or physical) need it fills for the consumer. Knowing the needs and wants for your customers are essential. And understanding those needs and wants does not stay static, but change will help you to continue to move your business forward.