Big Question for every startup-“I believe in my company and its product(s), but how can I help the world see its value?” With the help of valuable input from others who have tread down some ground this same direction, you need to understand and work out your Unique Value Proposition before you go much farther on your startup journey. It will be the perfect start for your Elevator Pitch:)
What is a Unique Value Proposition? It is a promise of value to be delivered. It’s the primary reason a prospect should buy from you. In a nutshell, Peep Laja explains that a value proposition is a clear statement that
explains how your product solves customers’ problems or improves their situation (relevancy),
delivers specific benefits (quantified value),
tells the ideal customer why they should buy from you and not from the competition (unique differentiation). The key thing to remember is that you don’t need to be unique in the whole world, just in the customer’s mind.
All of this is good to know, but Why exactly do value propositions matter? Can they really have a big impact on converting prospects into new customers? What does your startup do? Who does it serve, and how are you different or unique? These are questions startups need to answer clearly, effectively and quickly. If not, Mark Evans of Forbes clarifies, target audiences (consumers, partners, investors, media) move on because they’re time-strapped, and there are so many competitive options.
In his article by the same title, Tommy Walker, explores the process and mindset necessary to create a killer value proposition when you’re in a crowded market with a focus on the following:
How to examine the competition
The reasons why people buy online
How to turn shopper’s buying motivations into a unique value proposition that sells
After you’ve done the competitive analysis & figured out your angle, all that’s left is to write your value proposition. You can test your value proposition by running Facebook or Google ads targeting competitor traffic, and point them to a landing page where the value proposition sits front and center. Trevor over at Lean Startup Machine used this method to validate a startup idea & value proposition, and got 50 signups within the first 2 hours of the page being live.
How To construct it? The value proposition is usually a block of text (a headline, sub-headline and one paragraph of text) with a visual (photo, hero shot, graphics).
There is no one right way to go about it, but Laja suggests you start with the following formula:
Headline. What is the end-benefit you’re offering, in 1 short sentence. Can mention the product and/or the customer. Attention grabber.
Sub-headline or a 2-3 sentence paragraph. A specific explanation of what you do/offer, for whom and why is it useful.
3 bullet points. List the key benefits or features.
Visual. Images communicate much faster than words. Show the product, the hero shot or an image reinforcing your main message.
Example of Austin’s new kind of grocery store at in.gredients.com/products/
Tommy Walker, who also blogs for Conversion XL blog, clarifies, “Your value proposition should come from what you do better than the competition, not from forcing copywriters to be clever. The point is, in crowded markets, you’re not really selling the product, you’re selling customer experience.
So pull your Startup team together and have a Unique Value Proposition Party while you look for a concise, clear and competitive block of text to tell the world about YOUR STARTUP,
Resource links related to How to Construct a Unique Value Proposition for Startups
1. How To Come Up with a Value Proposition When What You Sell Isn’t Unique? Tommy Walker
5. Value Propositions by Keith Hammonds
6. Value Proposition-by Joseph Wilson- excellent slide show for a quick overview
Excellent article on the Why and How of Value Propositions.