Customer value propositions are an essential part of a company’s business strategy and the foundation for all of its marketing and sales efforts. Unfortunately, many companies don’t devote enough time and energy to defining their customer value propositions, and as a result, their marketing and sales efforts aren’t as productive as they could be.
It’s difficult to overstate the importance of compelling value propositions. In Playing to Win: How Strategy Really Works, A.G. Lafley and Roger L. Martin argue that a business strategy is essentially the answers to five interrelated questions, the two most important of which are:
- Where will you play?
- How will you win?
A few years ago, CEB conducted a survey of decision makers in B2B companies and found that only 57% of the “unique benefits” touted by sellers were seen by potential buyers as having enough impact to create a preference for a particular seller.
- They are too generic. They don’t speak to how value is created for specific types of companies or buyers.
- They focus on product or service features rather than on the tangible results a customer obtains by using a product or service.
- The don’t include credible supporting evidence.
- What are all of the significant reasons that people have for purchasing a product or service like mine? What problems or needs motivate the buying decision?
- What kinds of companies are likely to have the problems or needs that underlie these reasons to buy?
- Who within the prospect organization is affected by each problem or need? Who has the most to gain if the problem is solved and the most to lose if it isn’t?
- What specific outcomes are these people seeking?
- What features of my solution will produce these desired outcomes?
- What will the business/economic benefits be if these desired outcomes are achieved?