Value proposition

Value proposition 2019-04-23T18:24:39+02:00

A value proposition (VP) marks with a few words the essence of the value your product or your service creates for the consumer, which makes it a unique tool to guide in-house communication and priorities in addition to giving consumers a clear picture of what they gain from using your product.

Properly executed a VP may be your company’s strongest selling tool, but several demands must be met before achieving that effect, which may be the reason why only a few powerful VPs are out there.

We will be showing you examples of good value propositions, go in depth with what elements and demands must be met and provide an overall picture of which tasks precede the phrasing of a good value proposition. First and foremost, we aim to show you the value of a strong VP.

The value of a strong value proposition

There is a long list of big and small advantages of a value proposition. Here are a few of the most important ones:

  1. The first advantage is not directly linked to the end-product, but to the process, because working on your VP you will be faced with many questions, discussions and considerations and the answers make for selection and also deselection of what it is, you provide and do for your clients. Instead of the extensive lists of product benefits that especially B2B companies have prepared, the outcome of your discussions will provide you with clear cut priorities and focus on the elements in which you differentiate the most. Additional benefits are saved time, money and energy.
  1. A VP is enormously helpful in connection with marketing materials, physical as well as online. I.e it gives a very clear picture of the central marketing message, and you will avoid the usual inkling to provide as much information as possible on the product’s attributes and benefits. It should be as simple as that, although this is an area in which companies often fail in not knowing where to limit themselves.
  1. Additionally, the sales people will get a clear message to pass on. Supported by facts and based on the areas where you differentiate yourself the most in the eyes of the consumer, the sales crew can get a powerful story across, of the value clients obtain by purchasing your product.
  1. Potential clients will easily pick up on who you are, what you provide and how they can benefit from it. You would think,  that this is a normal outcome after a marketing department and advertising agency had finished. Unfortunately, it is not so. ’Innovative’, ’faster’, ’better’, ’more cost-effective’ etc. are examples of words that are used in many so-called value propositions but are simply buzz-words, that the competitors in your business often use, making it very unclear to the consumer who stands for what. A thoroughly worked out and well documented value proposition can make a difference.

What is a value proposition?

Let’s begin first of all with what it is not. A value proposition is not simply a couple of phrases that sound good or contain some trendy buzz-words. Nor is it a slogan or a tagline, like “Just DO It”, “Because you’re worth it”, “Think Different”, even though the slogans themselves have value.

It is not a product description either or a USP (Unique Selling Proposition) although the latter overlaps somewhat. A USP’s main focus is on what makes the product better, and the differentiation is of course part of a VP, but the USP rarely looks at the value created by the better product.

The latter is essential. A value proposition must contain “the overall perceived value of your product or service” i.e. all that your clients want to obtain from your product.  And it must asses how the value differentiates from that of the competition. If you are a software supplier it is fair to assume, that your clients want to know, what savings or earnings your software will ultimately bring them and how it exceeds that of the competition.

In almost all businesses, providers have products that are similar to each others in certain areas.  These characteristics could be described as commodity qualities and are not suitable as the basis of your VP. You need to find out what positively distinguishes you from the competition; the edge, that gives clients something extra. If you are currently unable to find it, then your time is better spent on product development than creating a value proposition. You MUST of course have something special to offer.

Naturally, there are always exceptions. A VP does not always need to be based on facts. In the end, what makes consumers buy something is their” experienced value”, i.e. their perception.

Thus, some companies can rely on their good name (if consumers in general believe that the company has a stronger product than the competition) or on clients not being aware enough of the goings-on on the market and have no intention/are unwilling to find out. The latter is continuously becoming rarer due to the easy access to information in general.

You must ask yourself if it is profitable in the long run to rely on your reputation or the lack of market transparency if the competition’s product offers more, and are you willing to take that risk?

Examples of good value propositions (one of them is well-known):


A Great Shave for a

Few Bucks a Month

No commitment. No fees. No BS.


Our products and services simplify and automate all phases of acute care testing, so hospitals can get fast results, reduce workload and the risk of errors, and improve cost effectiveness.


Company supplies whole of market, independent competitive information in half the time and cost compared to any other data collection alternative. Packaged in a user-friendly software solution it even provides exclusive and value-added data and services by disclosing real insights into your product portfolio’s performance, and enhancing your marketing responsiveness and customer retention.

What to expect from a good value proposition

Overall a VP must be based on a solid understanding of the consumer’s pains, wants, demands, decision criteria and preferences. Without it, creating a strong message will be difficult as the finished value proposition must be an unambiguous, clearly phrased statement describing:

  • What does the product do for the consumer, i.e. solve a problem, improve a situation or strengthen them (Relevance)
  • What is the specific value created (Yield)
  • How is your product better than that of the competition (Differentiation).

It may not appear to be difficult, and most companies have of course discussed and phrased their message around these mentioned elements; nevertheless, they usually end up being general statements with only marginal differences to those of the competition, so they are perceived as non-differentiated and pointless to potential clients.

Do this!

If all your good work ends up in pointless general statements, it is due to the statements not meeting one or more demands:

  1. Be specific: Everyone says they are “biggest” or “best”. If you in fact are, don’t write you have the largest assortment. Be specific and say you have 3231 product variations. That is specific and true. And if in fact a large assortment is what the consumers want, they are most likely to find out what amount of variations the competition carries.
  2. Prove it: If you are unable to prove it, your statement will be nothing more than an assertion. People are in general suspicious of undocumented statements. Perhaps you can find external facts, statistics or studies to use as documentation. Possibly you already have the information or will be able to create it (truthfully). Presented to the consumer it sets you apart and increases credibility. An alternative to documentation is testimonials from previous clients or partners. Are they trustworthy and going out of their way to support your claims, they can be equally convincing to potential clients as factual documentation. Remember though that testimonials also need to be more than general statements. The wording must be scrutinised and be both tangible and specific.
  3. Offer a guarantee: An alternative to proof could be to provide a guarantee. Money back or “payment only upon satisfaction” are familiar ways and better than nothing, although perhaps already too familiar. If your clients are indecisive they might think, that they will waste too much precious time on it. Think about what you can guarantee to make them decide. Maybe 120% back on their purchase price?
  4. Offer a test option: If you are unable to document your statement or provide a guarantee because the payoff depends on uncertainties, you could offer an attractive and easily applicable test option.

If you should use any, or one or more, of the above-mentioned  “elements of trust” entirely depends upon your product, service and company. Discover the possible options and find out in which way, they are deemed trustworthy by your clients.

How can we help?

The structured starting point of a value proposition is an in-house workshop, in which you ask the participants the following questions (in that order):

value proposition

Next step is to interview your clients. It could be personal interviews or/and be a large quantitative analysis depending on your business, product maturity etc. The purpose of the customer survey is to find the answers to:

value proposition

The last step is usually another workshop and possibly more to complete the survey, compare it to the preliminary in-house exercise and focus on creating a value proposition that is both specific and credible in the eyes of the consumer and preferably documentable.

Please contact us for further information on how Contribution can help your company with a value proposition.

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