By Ann Marie van den Hurk
WWR Article Summary (tl;dr) For entrepreneurs, you need to know your “Value proposition.” A value proposition is a statement summarizing why a consumer should choose your product over your competitors. It seems like a simple question to answer but surprisingly many women in business never really define what type of value they are bringing to the consumer. This article has a few tips on how to define your “value proposition”
At its core, running a business is simple and straightforward: You provide a consumer with value of some kind, and they provide you compensation. A business owner cannot realistically expect to be compensated if he is unclear on the value he is offering or is unable to articulate it.
That is where having a “value proposition” comes in. A value proposition is a statement summarizing why a consumer should choose your products over your competitor’s. It should convince customers that your product or service would solve a problem or fulfill a need better than those others are offering.
Does your business have a value proposition?
It should. Small-business owners should care about their value proposition because it is the foundation of their success, says Elijah May, the managing partner of The Experience Firm, a marketing and public relations company. May says that, sadly, a huge percentage of businesses don’t really realize what business they’re in.
The more competitors you have offering similar services, the further you need to go to make sure your value proposition is unique.
To illustrate this point, May discussed two footwear brands: Toms Shoes and Jimmy Choo.
Toms Shoes offers the same basic value proposition as all other shoe companies: Feet are safer with shoes on. But what makes its product unique, and is therefore its true value proposition, is that when customers buy a pair of Toms, a free pair is sent to someone in need. It’s kind of like fair-trade coffee, and it makes the brand stand out.
Jimmy Choo shoes, on the other hand, might raise a consumer’s social standing, which to some, justifies a high price tag and makes the brand memorable.
So, how can you make a unique value proposition work for your business?
May says small-business owners need to know basic human psychology. Pretty much all people have the same fundamental wiring, he says. Once you understand that nearly everyone is just trying to fill the same needs, you can start to communicate directly and effectively how your business is going to meet those needs, and your business will suddenly become far more relevant to consumers.
To help people embrace this way of thinking and begin to describe what their small businesses have to offer, May teaches a class called “How to make your customer CURSE.” 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 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.
ABOUT THE WRITER
Ann Marie van den Hurk, an accredited public relations professional, is principal of Mind the Gap Public Relations and author of “Social Media Crisis Communications.”