If you search online for the definition of 'value proposition', you're likely to find something like this:
"A value proposition is a simple, concise, and direct statement that explains why a customer should choose your product or service over competitors. It outlines the unique benefits and advantages that your startup offers, and how it addresses your target audience's needs and pain points."
That definition is all well and good, but in our experience, it falls short when explaining why it's important for you as a founder, to spend time thinking about the best value proposition you can have.
Ideally, your value proposition will be an intersection of the problem you're addressing and the solution you propose for it. If you've already sat down to think about your target audience and the problems they face, the gaps in the current market offerings that should address said problems, and the opportunities to fill those gaps, your value proposition should be fairly straightforward to write.
Leveraging a pressing problem and a great solution to combine them in one simple statement, thus creating a strong value proposition, can help differentiate your brand and increase customer loyalty and retention. It's essential to make your value proposition clear and relevant to the potential customers you want to capture, so they understand what you're bringing to the table.
In addition, a great value proposition should be easy to understand and communicate, and it should reflect the values of your company. It should be relevant to your target customers and make them feel like they’re getting something that no other competitor can provide. It should also be versatile, so you can convey the value your company offers in a variety of platforms, marketing tools, and communication channels. In short, a value proposition can make or break the success of your startup, especially in its earliest stages.
There are several possible approaches to a business value proposition. A single, well-defined phrase or sentence can be effective if the solution you're offering is equally as simple. On the other hand, if the problems your product or service addresses are more complex and specific, or if it answers to a smaller, more niche audience, a number of sentences or even a set of bullet points can be a suitable guide for your different needs.
Here are some tips to write a value proposition for your startup:
Of course, it's easier to understand if you have some concrete examples to go by. To help you make a powerful value proposition, we've taken Teammate as an example, as well as our sister company, Slidebean. We've used our own AI-powered business analyst to extract the specific problems each product is trying to address, as well as the solutions they propose to help their target customers tackle those problems.
Once you've clearly defined your problem and some possible solutions, the combination of both elements will allow you to clearly define your value proposition. In this case, Teammate is a valuable asset that functions as an expert business analyst that suggests ways to improve your company, without the cost and time of hiring a professional.
Here's another sample of what a great problem and solution look like. It's also a demonstration of Teammate's potential to look at your own company with a new perspective to better identify your strengths, weaknesses, and areas of opportunity in the market.
To effectively compare your product or service against a competitor, you need to start by identifying the key features and benefits of both offerings - beyond just your value proposition. This includes examining the pricing, quality, reliability, and overall characteristics of each alternative.
You can also gather customer feedback and reviews to gain insights into how your products or services are perceived in the market. By carefully analyzing these factors, you can create a clear and compelling message that highlights the unique benefits of your offering and helps to differentiate it from your competitors.
It's normal and expected for some (or many) of your ideas to fall flat during the validation phase of your business idea. In our experience, an idea can fail even if you think you've validated that it has a viable target market, and the root cause is often a value proposition that isn't effective.
When creating our main company, Slidebean, we worked to position ourselves as a better alternative to PowerPoint. We confirmed that -at the time- people, in general, had an unpleasant experience working with the software, so we saw an opportunity. Some years later, we realized that people still preferred to stick with the software they already had and knew how to use. Our value proposition, which was positioning Slidebean as a faster, easier-to-use general-purpose presentation software, wasn't strong enough to resonate with most of our customers.
For a startup to survive and thrive, is essential to be able to step back, reevaluate your choices and pivot accordingly. Working on a new value proposition from the ground up can help you find and address other weaknesses, like the Unique Selling Point of your product.
A Unique Selling Point (USP) is a marketing term that refers to the distinctive feature or characteristic of a product, service, or brand that sets it apart from its competitors and provides a competitive advantage in the marketplace. It is the aspect that makes a product or service different and more appealing to customers than similar products or services. A well-defined USP translates into a strong value proposition.
A Unique Selling Point (USP) is a specific feature or characteristic of a product or service that sets it apart from competitors. It can be a quality, benefit, or advantage that cannot be found anywhere else. A Value Proposition, on the other hand, is a statement that outlines the benefits your customer segment can expect to receive when using your product or service. It is a positioning statement that explains how a company can solve a customer's problem or fulfill a need better than anyone else in the market.
While a USP focuses on a specific feature, a Value Proposition focuses on the overall value a product or service provides to the customer. In short, a USP is what makes a product or service unique, while a Value Proposition is how that uniqueness translates into value for the customer.
This means that a USP is a key element that needs to be well-defined identified, and polished in your product or service itself so it can serve as the foundation of your Value Proposition at a larger scale.
A compelling value proposition is the foundation of optimal marketing materials that target your ideal customer. Without an effective value proposition, your whole business strategy might be in jeopardy further down the line.
We know from experience that a founder doesn't always have the time -or experience- to sit down and dedicate to your USP and value proposition the amount of effort they demand.
Identifying your Problem and your Solution is the very core of your business, but turning these elements into a base for your marketing strategies can be a challenge. Many sources recommend hiring a business consultant or strategist to take care of these tasks.
Outsourcing such a person comes with its fair share of risks and problems, however, as they're a considerable expense for an early-stage startup, and they often don't understand your product or your market like you need them to.
Teammate takes what you already know about your own business and dynamically offers insightful data on your prospective customers, your market segment, your competition, and how to achieve better results without the need for constant meetings and updates - something a business consultant would require.
