Are you wondering how to write a great value proposition?
Keep in mind this is the driving force behind catching the interest of your target demographic. Without a great one, your products will not engage with consumers. Learning how to write a good value proposition is therefore essential.
In this article, I’m going to look at how you can transform your brand and the way it is perceived.
The Ultimate Guide To Pitch Decks
Here is the content that we will cover in this post. Let’s get started.
- 1. What is a Value Proposition?
- 2. What is a Bad Value Proposition?
- 3. What are the Features of a Great Value Proposition?
- 4. 4 Steps to Write the Perfect Value Proposition
- 5. Step 1: Create a Brand Message
- 6. Step 2: Convey Your Unique Selling Point
- 7. Step 3: Know Your Target Audience
- 8. Step 4: Combine Functional and Emotional Ideas
What is a Value Proposition?
Your value proposition is what makes your product/service most desirable to customers. It concisely shows how your product is beneficial to the customer and how it stands out from the competition.
A powerful value proposition, therefore, highlights how your product solves a problem for customers, making it an essential purchase for your target audience.
Your value proposition is the foundation of your marketing strategy. By putting your value proposition at the heart of your promotional material, you are conveying in an effective way why people should be interested in your brand.
In essence, then, your value proposition is how you convey persuasive information about your product. When someone asks you what your product is and why they should buy it, you should answer this question with your value proposition.
What is a Bad Value Proposition?
To learn how to write a great value proposition, you must understand how it differs from a bad one. A bad or ineffective value proposition does the following:
- Confuses customers about the function of your product
- Overlooks or omits your product’s most important features
- Assumes customers will automatically be interested in your products, and so, therefore, does not attempt to be persuasive
- Presents false or misleading information about your product or service.
Anyone of these or a combination can sink even the best product, so it’s important to avoid these missteps.
What are the Features of a Great Value Proposition?
When you’re learning how to write a great value proposition, you have to understand what the underlying features or components of a great value proposition are. These features can then be crafted to best represent you, your product, and your brand.
A great value proposition has the following features:
- It is easy to understand
- It is concise
- It describes your product’s key function alongside the problem it solves for customers
- It describes your product’s advantages over competitors
- It has been crafted specifically to resonate with your target audience
When you are raising capital, for example, your value proposition needs to be super clear for investors. Also before you even go out there seeking investors remember that storytelling plays a key role in fundraising and you will need capital to scale things up. This is being able to capture the essence of the business in 15 to 20 slides. For a winning deck, take a look at the template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
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4 Steps to Write the Perfect Value Proposition
Don’t expect to come up with the perfect value proposition immediately. Anything worthwhile takes effort and time. Considering that your value proposition is what will persuade customers to buy a product, and a poorly constructed one can sink your business, then it is worth taking your time over.
That being said, there are four simple steps you can take to create a great value proposition. I’ve used this framework many times when advising entrepreneurs who have signed up for my mentoring group, the Inner Circle, and it continues to work for thousands of entrepreneurs around the world. There we help entrepreneurs from A to Z with everything related to fundraising.
Below I discuss how to package and position your value proposition in a pitch deck.
Step 1: Create a Brand Message
Also known as a “brand heart”, the message at the center of your brand and what it conveys is a huge part of your persuasive repertoire. Think of strong brands like Apple or Nike. People buy their products not just because the product itself is reliable and desirable, but because the brand is trusted and has a level of cachet associated with it.
This brand message is intertwined with your value proposition, It should be used to raise up your value proposition through brand worth. This puts your brand identity at the heart of your value proposition. In the future, hopefully, your brand will be strong enough that its desirability to customers is so effective that it will sell almost any product.
To create a strong brand message, answer the following questions:
- What is the purpose of your company?
- What is the ultimate vision for your business?
- Which values are at the heart of your business and its products?
Step 2: Convey Your Unique Selling Point
The truth is, someone else has either already launched a similar product to yours or is in the process of doing so. It’s very rare that a product is completely in isolation and truly groundbreaking.
Part of your value proposition then is helping customers to understand why your product is different from the competition. This means persuading customers away from your competitors and funneling them towards your brand.
When crafting your own value proposition, think about what your unique selling point is, and you can do this by carrying out a competitive analysis of the marketplace, highlighting what you’re offering that others are not.
Step 3: Know Your Target Audience
Some businesses stop short of truly getting to know their target audiences. They may do a little market research and identify the general demographic they are trying to target. However, when crafting the perfect value proposition, you need to go deeper than that.
Remember, your value proposition isn’t there to entice you. You already know how great your product/service is. Your value proposition is to be persuasive to a very specific type of person. To make it as persuasive as possible, you need to tailor it to that audience.
This involves creating something called a buyer persona. Also known as a “marketing persona” or “customer avatar”, this is a generalized representation of the individuals making up your target audience. It is the ideal customer for your brand and product By creating complex ideas about the psychology, identity, and wants of that persona, you can create the value proposition that will mean the most to them.
Step 4: Combine Functional and Emotional Ideas
When you sit down to create your value proposition, it’s good to keep in mind two aspects of your ideal proposition. The first is the functional side of your product. For example, perhaps you’ve created an app to help driving instructors to teach their students.
The functionality then is in displaying driving information on a tablet that students can peruse at their leisure between lessons, reinforcing what they have learned.
The second aspect of your value proposition is the emotional side of your pitch to customers. This is often the part of your proposition that explains the benefits of your product in a positively reinforced way.
Taking the example of a driving app for instructors, the emotional pitch for the product could be that it improves pass rates, helping instructors build a better reputation for themselves and their businesses. This is something that will connect with an instructor at an emotional level.
Your value proposition should include both functional information and something that works on an emotional level.