Mals Musings: Is Your Value Proposition Unique?
Every business manager is obsessed by a desire to deliver a unique value proposition, the kind of proposition that customers just cannot resist.
By on Jun 1, 2010Every business manager is obsessed by a desire to deliver a unique value proposition, the kind of proposition that customers just cannot resist. Unfortunately, most of the value propositions are missing the unique and sometimes are even suboptimal.
The value proposition is an organizations answer to its customers problems. It is vital because it sums up the totality of our deliverables to customers in terms of how it solves their problem. It is not about features, benefits, messages, products or services. It is all of these plus more. Value proposition is what the customer buys.
A famous business leader once said, If you do not have a competitive advantage, then do not compete. It is similar for value propositions. If it is not unique, you are destined for mediocrity.
The challenge for most marketers in developing value propositions is that they get the first step wrong, which is to accurately define the problem of their customers. Customers want solutions to problems, not products or services. So for us in healthcare, it is more than pills and devices. Regardless of how innovative and competitive those pieces may be, it will take more than that to solve our customers problems.
So in some cases, organizations have appreciated surgeons need for education and support or OR staffs need for training as areas where they can deliver a differentiated solution to enhance their value proposition.
There are others who are so obsessed by what they have documented as their value proposition that they forget that it is about what you deliver rather than what you planned to deliver. It is vital to understand actual deliverables rather than the planned deliverables. In addition to understanding our customers problems, we need to have a clear view of what our competitors are delivering. Propositions should not look like they are developed in a vacuum where no competition exists.
We have few options in terms of improving our value propositions. First, we can improve the benefits we can deliver to our customers through better products, service, support, etc. Second, we can reduce the cost of attaining our proposition for our customers. Finally, we can do both. The easiest to do is reduce cost, but it is a slippery road to nowhere, which leaves us with the option of increasing benefits. In the end, the secret to enhancing benefits lies in a thorough understanding of customers needs. A superficial understanding of customers problems will only produce fools gold, benefits that are totally unique and totally irrelevant.
What we say is also a vital part of our value proposition, and effective communication is critical to an effective value proposition, as this short story illustrates
Once upon a time, in a village, there was a lady called Truth who wanted to make a difference. She decided to go and share the news with the villagers. However, every time she knocked on a door, they would answer but she was never invited in so she never got to share the truth. Then one day, she met a guy called Story and he also wanted to change the circumstances of the villagers and, like Truth, Story went knocking on doors and he was always invited in although he never got to stay for a significant amount of time. Eventually, the two came up with a plan that they should work as a team, Story and Truth together. Amazingly, everywhere they went, Story got them in and then they shared the Truth and changed the circumstances for the villagers.
The moral of the story is, what you do is the truth. It is the customer perception of the value you deliver. The story is your marketing communication: messages, brochures, mailers, etc. The secret to achieving your goal, like Story and Truth, is to get these two working together. Then there is a credible and compelling story.
The most important part of your value proposition is value; hence, our effort should focus solely on how we deliver more.