Assume you live in San Diego, California and you’re in need of a marketing company. You log on to Google, type in the magic search terms and click the first link you see. And you’re presented with this home page on the right.
Would you have any idea what they do exactly or who they serve? If you said no, join the rest of customers who struggle to figure out why they should pick one company over another.
In a world where the average attention span of an adult in 2012 according to StatisticBrain.com was eight seconds.
Yes…eight seconds! That’s all the time your website has to tell a customer why they should stay and learn about your company.
If a prospective customer has to make sense of what “Connect Inspire” means… they’ll leave. It’s that cruel of an online world we do business in.
Anything less than a clear, concise statement that says what you do and why it’s better than the competitor will, frankly, not grab the attention of a prospective customer.
Unfortunately most customers will never ask us what we do and why it’s better because they don’t have the time or patience to do so. Many websites dazzle us with flash displays, brilliant pictures and colors, but never actually tell us what they do or why we should buy from them.
A Real Live Case Study: Domino’s Pizza
What you have is a completely wasted effort by the marketer, and all the while the customer endures yet another search to his or her questions that remain unanswered. To give you an understanding of what kind of impact developing a value proposition can be to your company, let’s look at an example—see if this one sounds familiar:
“Hot, fresh pizza delivered to your door in 30 minutes or less… guaranteed.”
If you guessed Domino’s Pizza, you nailed it! But how, and why, was this simple statement effective? Robert Passikof of the New York based Brand Keys has this explanation:
“They rank No. 1 because of the value proposition, because of locations, because of service, because of the ability to deliver the promotional extras.”
Domino’s value proposition offered customers something that had strong appeal and exclusivity. Customers knew they could get a pizza (despite the quality) that was hot and delivered to their door in an agreeable amount of time. Like McDonald’s, people value the speed and service over the quality of the product.
So how can your company develop a value proposition that is clear, easy to understand, and easily engageable? One company in Florida created a formula that systematically allows you to discover and express the value of your business in a clear and concise way.
A System For Finding Your Company’s Value Proposition
MECLabs, a company that invests $20 million in marketing experiments, developed a systematic way to find your company’s value proposition. Dr. Flint McLaughlin, director at MECLabs says your value proposition must answer this critical question:
“If I’m your ideal customer why should I buy from you versus one of your competitors?”
Yes, the same one mentioned earlier. The value proposition must make the argument that your specific product or service is special from everyone else’s. Now it’s time to show you how to communicate that very message with your customers.
Value propositions have four fundamental elements:
- Appeal – I want this
- Exclusivity – I can only get this from you
- Clarity – I understand this
- Credibility – I believe you
The first step in determining your value proposition is to list five pieces of value that your company offers to its customers. As you write this list, try to avoid filtering your answers–even if you think they’re dumb. For this example, we’re going to pretend we run a gym that conducts group fitness classes in a busy downtown city district.
Here are my five pieces of value:
- High intensity workouts that help you lose weight done in 30 minutes
- Located in downtown within a 10 minute walking distance from your office
- Training classes with fellow executives, just like yourself, offers a perfect opportunity for networking
- Classes scheduled before you start work, during lunch and after you leave the office
- Learn over 20 different fat burning exercises to help you find your optimum fitness level
Once we have these pieces of value jotted down, it’s time to see which illustrations truly stand out. The way we’ll make this determination is to rate each one on a scale of one to five, with five being highest.
You’ll want to use your market intuition here, but be conservative; if something isn’t truly exclusive and you know other competitors do the same thing, then use a lower score. Also, it’s perfectly fine to rate something with a .5, which helps to create more separation between scores. Our goal is to narrow the list down to your top two pieces of value.
Have a look (App = appeal / Exc = exclusivity):
- High intensity workouts, and losing weight in 30 minutes: App = 4.0 / Exc = 4.0
- Location within 10 minutes of office: App = 4.5 / Exc = 4.0
- Train with fellow executives: App = 4.5 / Exc = 5.0
- Flexible class schedule: App = 3.5 / Exc = 4.0
- 20 fat burning exercises: App = 3.5 / Exc = 3.5
Knowing your customers the way you do, we’re confident they are short on time, and don’t want to travel far to get in shape. But one thing we also understand is that busy executives like to be around people just like themselves. They love sharing stories and exchanging ideas, and you can communicate this with the value proposition statement.
But can we believe these claims? Here’s where we add evidence to make them more credible, and, thus, gain the trust of our potential customers. So our top two statements are the location and networking aspects. Great, so now we’ll make this look believable by adding evidential statements behind the value pieces.
Evidence #1 – We are located on 123 Broadway in downtown just minutes from these corporate buildings (put specific buildings in).
Evidence #2 – You can take the subway or bus and reach our gym in approximately eight minutes or in five minutes by car.
Evidence #1 – Executives from these companies (fill in companies) come to our training sessions regularly
Evidence #2 – Connect with fellow executives by putting your business card on our networking board
Now why does this work? Because if you really wanted to test these claims out they would be easy to measure. Hop on a bus and get there in less than 10 minutes? OK done we can believe that. You could walk into the gym and see the classes or check out the networking board with your own two eyes.
Here’s the clarity part where we put the value proposition statement together. Here’s a statement we could use:
“Fitness Classes That Connect You With Fellow Executives Within 10 Minutes Of Your Office”
Do we know what’s being offered? Yes we know this business offers fitness classes that are close to my office where I can meet other executives.
Can we craft a better value proposition? Of course, but having a clear statement of value helps your potential customers draw conclusions about what’s being offered to them much faster. What this means for your business is the opportunity to stand out, be understood and close more sales.
Here’s your action step for today, tell us your company’s top two pieces of value you offer customers and put it in the comments section below.
The Ann Arbor News, Domino’s hopes new pizza recipe reshapes image on quality
MECLabs, MarketingExperiments.com – Value Proposition