I’ve written hundreds of value propositions over my career to date, and in this article, I’ll explain why they’re so important and how they can fall short, who they’re for, and how they fit in with your comms strategy.
I’ll share some best practices from our clients at Aventi, highlighting three real-world examples to give you a practical overview of both short and long-form value props, and finish with a template for you to take back to your PM role.
My name's Sridhar Ramanathan and in this article, I'm going to focus on how to write a killer value proposition. I know all of you have written value props before, I personally have done probably hundreds over the last 25 years.
What I'm really going to share are some actual best practices from clients of ours that we have done and worked with.
This is designed to be a very practical article so I'm hoping this gives you something specific you can take away.
I'll focus on essential topics, including:
- What a value proposition is
- Why you need a clear, defined value proposition
- How to align value propositions with your comms
- Who uses a value proposition
And much more...
What is a value proposition?
I know you know this, one of my fellow Aventi partners, who's an amazing leader, formerly Vice President at SAP, came up with this sentence.
A value prop outlines the job that your product or solution is intended to do and serves as a promise of a benefit to your customer.
Now, of course, this sounds pretty straightforward. I will tell you, and I'm sure many of you see this, a lot of times people write value props and it's really more of a feature statement or a technology statement. It's not really about value.
I'm going to concentrate on value, specifically, what is the value in the mind of the customer?
Looking for more info on how to write a killer value proposition? Why not check out Aventi's on-demand webinar? Thank us later.
Watch the on-demand webinarWhy do you need a defined, consistent value prop?
Why is a value prop so important?
Gets everyone on the same page
One of the biggest benefits is getting people in your company and your business unit all on the same page.
I'm sure you've all seen this - sales folks have one idea of what a value proposition is, and this is usually different across marketing, engineering, product management, and the executive teams.
Many times the value prop is not consistent, not well defined, and people are not on the same page. When that's the situation, then obviously a lot of your execution is flawed. There's a lot of money being spent that's not making an impact.
Solidifies your identity and defines your playing field
Ideally, the value prop is something you formally get approval on and becomes the foundation, but also sets the stage for your identity.
- What business what category are you in?
- What market are you playing in?
Provides foundation for all sales/marketing execution
It's foundational to all your sales marketing execution, the value prop should be again, approved and used in all your execution.
Helps companies focus: a guide for business decisions
It also provides quite a litmus test or a focus because things will come up and the engineering team will come up with new product ideas and new features.
You might also have new technology alliances, new geographies, and new partners. All of these things have to reinforce your value proposition.
A value prop provides quite a bit of focusing.
How does a value prop fit in your comms?
Where does a value proposition fit in your communications?
Value proposition
First off, it is the promise, it's the promise of the value you're about to deliver. That is different from positioning.
Positioning
Positioning, as you know, is more about the position you want to occupy in the mind of the customer. A shortcut to that is the category:
- What category are you in?
- Are you a cybersecurity firm?
- Are you an HR SaaS company?
- Are you an infrastructure player?
- Are you a storage company?
Sometimes positioning is similar to a category in the mind of the customer. That's not a value prop that's positioning.
Audience-specific messaging
Messaging nowadays, of course, marketers are very sophisticated. We message specific audiences, specific personas. Messaging is meant to be crafted as a communication to those specific target personas.
Again, that's not a value prop. That's messaging.
Tagline
Sometimes people get confused, a value prop is the same thing as a tagline? It is not. A tagline tends to be a short catchy phrase, a statement, a sales selling point.
A value prop really is this promise of the value to be delivered.
In this article, I'm going to share with you some specific templates.
Who uses a value proposition?
I also want to clarify a value prop is not intended to be used as-is by the salespeople or put up on your website immediately. It very much is a foundational statement that different folks are using.
Copywriters to turn into final copy
So copywriters will take the value proposition and turn that into copy for your website.
Branding team for ad copy
Your branding team, when they're doing advertising, digital and media buys, or ad copy, they're going to start with the value prop. Among other things, they're going to need personas, your branding, strategy, etc. But the value prop is used by those professionals.
Digital marketers for campaigns
Digital marketing, your campaigns team is going to need to know what is the value prop? To whom? Why should they care? All that is covered within the value prop.
Graphic designers for creative assets
The designers are going to want to create a visual representation of your value prop. Creative, different design logos, images, graphics, all those elements should reinforce your value proposition and they should be consistent. They are going to be consumers of your value prop.
Marcom for consistent message across execution
Your Marcom team, of course, they're going to need it for all kinds of execution, websites, social, search, etc.
Sales enablement for sales tools and training
And then sales enablement, even the sales enablement team needs to use the value prop for sales training materials, battle cards, and playbooks.
Who’s missing?
You'll notice your one audience that's not here on the value prop is you don't want to hand it directly to sales, you don't want to give it straight to your web team to go up on the website.
It really is meant to be a foundational piece. I want to make that clear upfront.
3 key elements of a killer value proposition
There are three things that are key if you're going to create a killer value prop, almost like a litmus test.
Why?
What is the problem we're trying to solve? It's got to solve a specific job that a person is trying to achieve. On the customer side:
- What problem are we trying to solve?
- Is it really worth solving that problem?
- Is it nice to have?
- Is it a critical pain point?
- How high of a priority is it?
Why now?
We also want the value prop to speak to why now? That's the case for change or the case for action.
Though a lot of times customers are fine, don't be afraid to disrupt the status quo and make a move. A value proposition should be compelling, actionable, and urgent - if change is needed to make this happen, then so be it.
It needs to convey some level of urgency, and maybe a little bit about the consequences of inaction. What if you don't move forward, what's at stake here?
Why us?
The third thing is why us? We need to get the differentiator in the value prop because it's not enough to say why and why now you also want to distinguish why your company, and why your solution.
You're going to need to make some claims that should be defensible, backed up by proof points, concrete and measurable. That helps to reinforce why we are the best option.
Real examples
I'm going to give you two flavors, a short version, and then a long version. And I'm going to give you three specific client examples. These might be templates for you to think about.
Value proposition: facility management SaaS example
The first example I'm going to use is a SaaS company. They're in the facility management software space, full disclosure, they're a client of ours called 4insite.
They sell software to large organizations that have a lot of facility workers. Think of custodial staff, think of electricians, plumbers, landscapers, all those contract folks who come into buildings or facilities to maintain the facility.
The short version
This is the short version of the value prop.
4insite
4insite helps organizations connect, analyze, manage, and empower their frontline staff.
That's very concrete, it may not sound exciting to you but I will tell you the persona we're speaking to is dealing with these issues here. Let's go through this one by one.
Why?
Manual processes. The current pain is facility executives, VPs, directors are fed up with a lot of manual processes, very disconnected tools, managing all these workers and it could be literally hundreds of workers on site.
With a pandemic going on there are extra concerns about safety and compliance. Unions are concerned about the health and wellbeing of the workers, so the why is very compelling, you can't have that kind of situation.
Why us?
So you need ideally a SaaS solution that is built specifically for facility management.
Why now?
Because you're losing customers, there are customers that are unhappy with the quality issues, the bathrooms aren't totally clean or the facilities are not being maintained or not safe and the facility companies are choosing other competitors.
This gives you a little feeling about what the value prop looks like.
The long-form version
I know this is a little bit of an eye chart so I'll just spend a moment to go through this.
This is a tool that product marketing folks have used for decades. It's been around a long time, a Stanford professor. I think his name is Lynn Phillips. It originally coined the long-form value prop.
When I was a HP executive, we were trained on this long-form tool. This is just the tool for product marketing folks, you don't necessarily need to share this out with everybody.
In this example, I'm sharing with you 4insite, we start off with who are the target companies you're going after? Large organizations that have a large frontline staff, at least 50 of those. This is similar to the ideal customer profile.
Who are they? These are companies that have some pain in quality, safety, compliance, union issues. This is the positioning, the category, 4insite is a facility management solution, a SaaS offering.
That's the mental bucket we want customers to think, "Oh, you're a SaaS offering or software company, you're not a services company, you're a software company". That's the positioning. Now, this is what we're delivering, this is what 4insite does, it’s reporting, dashboard, mobile communications, all this stuff here.
The differentiator here is versus manual tools, which are a pain in the neck, they lead to all kinds of quality problems, compliance problems, safety problems.
And there's an option which sometimes customers have internally developed software so that's a competitor. That's the do-nothing scenario. That's the status quo scenario.
The reason to go with 4insite is it optimizes that facility workflow so you can get higher quality, you can have higher quality, higher safety, higher compliance, these are the things that they care about - the outcomes.
Notice, we don't talk about feature function, we're talking about outcomes, we're driving higher quality.
That's one example of a long-form. Again, it's a bit pedantic, it takes a lot of work to go through this.
Value proposition: security software example
This is a security software company, I'm going to do the same thing.
The short version
Here's the short version of the value prop statement.
A little context, Absolute is a security software company, if you have a Windows laptop, maybe it's a Dell, maybe it's an HP or Lenovo, it's very likely you have this software running on your laptop, it's at the BIOS level, it's down almost at the metal.
Now, this software is super important because it manages and secures data, devices, and applications that are unbreakable. The keyword here is unbreakable.
Endpoint means the device, that could be your laptop as an example. Sometimes your laptop is off the internet, and you're not online. Even in that scenario, this laptop is unbreakable. Let's go through our three whys.
Why?
The first ‘why’ is customers are looking to protect their data. They don't want to be hacked, they don't want information to get out. They don't want their devices to get hacked.
Ransomware is a big deal now, you've all heard about the SolarWind's hack and many hacks going on that are damaging. So companies/organizations are afraid of being hacked. That's a big reason.
Why us?
Why Absolute? The keyword is unbreakable. It really is unhackable because it's down at that almost metal level. It's at the BIOS level, which hackers can't get access to.
Why now?
I mean, can you afford to be hacked and wind up on the front page? You don't want to be the next story in the Wall Street Journal or online media. This is a real fear that a lot of chief information security officers have.
They don't want the board coming to them saying why didn't you do something about this? So this is a super compelling solution and this is a compact value prop statement.
How do we get to this?
The long-form version
Here's the long-form version, I'll walk you through that.
At Absolute, they're targeting the IT organization, the IT Asset Management Director, all security operations professionals. Those are the ones whose neck's on the line. They're the ones who will get fired if there's a breach or they're the ones who will get promoted if their environment is really secure and very locked down.
What kind of organization? Absolute is not targeting small businesses and customers they're really targeting the largest organizations with 1000s of users.
Who specifically? It's the IT organizations that are struggling with compliance, how do you protect all those endpoints? An endpoint again, is a laptop, typically a laptop, iPod, your phone, any device where you're doing work.
How do you guarantee 100% of those devices are secure and compliant? Well, Absolute, and this is the category remember, they're a firmware embedded application, they're software but they're firmware embedded, unlike enterprise software security, for example, or unlike a SaaS cloud pure plane solution, this is embedded application. That's the category, that's the positioning.
What Absolute involves is it finds those endpoints that are noncompliant, puts them back into compliance, and repairs them. That's the job the customer is trying to do.
The IT person is trying to make sure all these devices are getting back in compliance because a lot of times they fall out of compliance, they don't have the latest patches, they don't have the latest antivirus, they don't have the latest OS updates.
That's the job the IT person is trying to do and unlike traditional security patches, a lot of times they fall out of working, when you go offline, those security patches are not enforced. They're not working. They're not effective, or they're costly.
So what is key here is it's persistent meaning even if you're online, offline, you reboot your machine, no matter what that Absolute embedded application is running, it's unbreakable.
That's a really powerful value proposition statement, this idea of unbreakability. That's the core of the message here, the core of the value proposition is it's unbreakable, and that ensures a resilient environment. So as customers are changing their desktops, things are happening, no matter what that device is locked down.
That's the long-form value prop we used. And again, this is used only by the product marketing team, this long-form in order to help the copywriters, the designers, the sales enablement team also come up with the copy blocks that are necessary.
Value proposition: enterprise services example
Here's the third one.
The short version
This is a large corporation, Unisys, and this is one of their services offerings. It's called Workplace Solutions. It's not software, it's services. It's actually a set of capabilities.
The idea here is to engage, empower, and transform the digital workforce. Now everyone nowadays is digital, we're all pretty digital warriors. Some companies are more digital and more reliant on productivity. Let's talk about the why.
Why?
Lots of companies are investing heavily in remote access, digital, digital everything, digital workflows. It's key to stay ahead of your competition.
Why us?
So you need a company that is experienced, it’s objective. We are a service partner to help deploy this full digital workplace.
Why now?
Well, your competition is already moving to digital, they’ve already transformed their enterprise. So let us help you catch up and overcome and exceed your competition.
The long-form version
This is what the product marketing team and we here at Aventi crafted.
We start off with the target customer, the ideal customer profile, we are looking for large organizations that are super dependent on so-called knowledge workers. These are people who are primarily delivering information and analysis and you're hiring them for very much their brains.
Where is that important? In banks, insurance companies, manufacturing companies, high tech, life sciences, pharmaceuticals, all those companies are relying on scientists, engineering, financial analysts, so super important to make them productive.
Those companies we are targeting only the ones that are committed to digital transformation, they may even have a Chief Digital Transformation Officer. So we can look for clues that this target ICP - ideal customer profile, is going after digital transformation.
What is Unisys digital workplace? It's a services offering, starting off from advisory to implementation into managed services. This has a special meaning for customers who really need help, they're understaffed, they don't have the right expertise, they're short on IT and they just really need help.
That's where services come in. Unisys has a proven capability, the whole digital lifecycle. Unlike traditional IT outsources that may be offshore. I won't name names, but you can guess a lot of the traditional IT outsourcing companies. What Unisys specializes in is industry experience, they have deep experience with financial services, banking, manufacturing.
They're also neutral, meaning they're not trying to push one software solution or set of software, they're really doing what's right for the customer. They're persona-based so there are different buyers within these enterprises. And they offer some pretty deep security.
These are some of the differentiators, all of these, by the way, have proof points behind them.
Lastly, who cares? So this is all great, but what impact is it going to have? This goes to the heart of the value prop, the value prop is about business value. We're going to drive higher productivity, and that's going to also improve their capital expenditure and operating expenses.
You do want to catch the 'so'; 'so' is the business benefit - but why does this matter?
Those are three long-form examples of customer value propositions.
What goes into creating a great value prop?
There's a lot of work that goes into value props, and you've all created value propositions before. The thing to think about is how to make it really rigorous.
Voice of the customer research on customer pain points, needs
One thing we recommend is getting customer research to understand the pain points. Don't let just the product engineering, product management side talk just feature function.
Product marketing is here to do a lot of customer research to get to the pain points and why those matter. Why do those pains need to be addressed, what's the business value?
Sales/SE interviews to learn what really works and doesn’t work
Also interview sales and SEs, I love system engineers, they usually really know what's going on with regards to pain points.
The product marketing folks, we recommend when you're working on value props, definitely do original research, talk to folks like salespeople and SEs and ask them what works, what's not working? Sometimes the feature function you think is important isn't so important.
Competitive analysis to hone your differentiators
Competition obviously, they're hammering on their own value proposition, so you've got to nail your differentiators. A bit of competitive analysis is very important to craft the value prop.
Industry analysts/influencers to build credibility for your assertions
Industry analysts, influencers, the Gartners, the Forresters, you have your own analysts who are watching your space, a lot of times it's good to test with them confidentially the value prop. I think testing is super important.
Message testing to ensure it resonates with buyer
Before you finalize and recommend the value prop for approval, you want to give credibility to your internal teams by telling them we've vetted this, we've tested this, not just with sales and SEs but with customers, with analysts, we've even looked at competition and we think this thing is really very strong.
Judge your value prop with an 8-point test
Now, one way to test your value proposition is we have a little eight-point test here. Eight questions to ask yourself after you've created the long-form version of the value prop or the short term, does it speak to a specific customer segment?
1) Is it speaking to a specific customer segment or it it too generic to be useful?
Don't be generic, like all large enterprises, we need to be specific, what industry, what size organization? What are some of the pain points? We don't want to be generic, we want to be specific.
2) Is it customer focused?
Is it customer-specific? Is it all about you, the vendor or is it all about the customer and their pain point?
3) Will it resonate with the target customer? How do we know?
Does it resonate? This is where testing is important, we need to know that this value prop actually is resonating. How do you know?
Because customers have told you, you vetted this with at least 10 quality qualitative interviews and maybe hundreds of quantitative surveys.
4) Does it differentiate from competitors including the "status quo?"
Differentiation - make sure you clearly state including the status quo, including the do-nothing scenario where the customer thinks it's a pain but it's not enough to go do a purchase and then deployment, we don't want to go through the headache.
Differentiation is important, sometimes your number one competitor is “do nothing”. It's people just saying I'm good enough.
5) Is it believable?
Is it credible?
6) Is it emotional - can a customer connect with it?
Is it emotional? By the way, a lot of times I see value props that are really engineering, very heady, very intellectual, that's great. But what drives the buying process, the buying journey, the buyers’ journey is often the emotional driver.
Sometimes in the security world, I deal with a lot of security, software companies, cybersecurity, and fear is a big driver. You don't want to be talking about fear but you want to understand that the chief information security officer, the IT folks, they're afraid of getting hacked.
And that emotion is important to understand and acknowledge in your process. Sometimes emotion, maybe excitement, and maybe power or confidence. Tap into the emotion in your value prop.
7) It is using customer language, not jargon?
Sometimes we tend to speak jargon, I deal with a lot of B2B technology companies and they use a tonne of acronyms. Try to stay away from that, use words that customers use. Be careful about that.
8) It is clear, compelling, and credible?
Lastly, is it compelling? Is it credible? Is it clear? Your message testing will really confirm that.
Thank you.
