If you’re an entrepreneur who keeps his or her ear to the ground when it comes to marketing, you may have heard colleagues or other marketing professionals mention the term value proposition when discussing the overall marketing strategy of every business. What is a value proposition and how is it used to boost sales and increase a client base?
Value Propositions Defined
A value proposition is simply a promise you make to your clients and customers, assuring them that they will receive value from your products and services. In order for the value proposition to be successful, your clients must believe you when you promise them value, leading to new sales and orders.
When you advertise and market your business, you are asking members of the public (your clients) to pay you in exchange for the benefits they will receive from your goods and services. If these benefits are greater than the benefit of having cash in the bank, your customers will be keen to place orders and buy products – this is what every business owner wants.
Your Unique Value Proposition
It’s important to remember that each business offers a unique value proposition to its customers, even though it may be selling a product that is similar to that of its competitors. Value is not just the price of your products or services – it has everything to do with customer experience.
For example, two businesses may be selling office supplies at similar prices but because the one offers free overnight delivery and allows products to be ordered online without the hassle of phone orders, its value proposition may be more attractive to customers even though its prices are not much lower than the competition.
When you market your goods and services, you’ll need to understand your target market and decide what products, services, and customer service would appeal to them the most, giving you an edge on the competition.
Reading Your Market
When you decide on your value proposition, ask yourself the following questions:
- How old is my target market? Are they young and tech-savvy, or older and more comfortable dealing with a person that a website?
- Am I selling premium goods or discounted goods? Remember that discounted goods coupled with great customer service can produce an excellent value proposition.
- Is my target market local, regional, or national? Depending on where your customers are, you can offer specials, free delivery, and promotions in the areas they live in.