Now that you’re clear on what your business does and the value it creates, the next step is to turn it into a full value proposition statement. The value proposition statement is a broad statement that summarizes the value and promise your company is making to potential customers. People need to quickly and easily understand what your company is offering and why they should care. We’ve already addressed the first three questions in my post about how to define your value proposition.
- What is the product or service being offered?
- What problem does the product or service solve?
- What is the value or benefit being promised to customers?
Let’s expand on these ideas by answering another important question:
- Who is the product and/or service for?
WHO IS YOUR PRODUCT OR SERVICE FOR?
A year from now, if we put all of your customers in a room, who would be there? More importantly, what would they have in common? Before you even start your business, you should have some idea about who would appreciate and see value in the product or service you’re offering. It’s a challenge, but the more specific you can be, the better. I will be posting more information on this topic, but to get you started, when picturing the people in your room full of customers, ask yourself:
- Are there men, women, or both?
- How old are these people?
- Do they all live in a specific area?
- How much money do they make?
- What do they have in common?
Related Post: 3 Questions to Ask When Starting a Business
HOW TO WRITE A VALUE PROPOSITION STATEMENT
Now with the answers to the four important questions above, we’re ready to put all the pieces together to create a clear value proposition statement, written in plain English, avoiding business terms and technical jargon. To get you started, take the answers to the above questions and use them to fill in one of the template sentence options below. Feel free to move the components of the template sentences around to make the sentence flow better, but include all of the information from the four questions.
TEMPLATE SENTENCE OPTIONS
Option #1: Company name is a product and/or service that provides this benefit (or solves this problem) for this group of people.
Option #2: Company name provides this benefit (or solves this problem) for this group of people with this product and/or service.
It will take some fine-tuning to make it perfect, but this is the beginning of your value proposition statement. Try it out on your family and friends. If you see confused faces, keep working on it.
Let’s look at a few websites to see how companies communicate the answers to the same four questions.
Example #1 Evernote
“Evernote (name) apps and products (products) make modern life manageable (benefit), by letting you easily collect and find everything that matters (benefit).”
- What is the product or service being offered? Answer: Apps and product.
- What problem is the product or service solving or improving for people? Answer: It’s hard to keep large amounts of online content organized.
- What is the value or benefit being promised to customers? Answer: It lets you easily and conveniently collect and find everything that matters.
- Who is the product and/or service for? Answer: Evernote customers are people with a need for a great way to collect and manage online content.
Example #2 1-800-Got-Junk?
“1-800-Got-Junk? (name) is the world’s largest junk removal service (service).”
This statement doesn’t include all the answers to the four questions above, but we’re still able to piece it together.
- What is the product or service being offered? Answer: Junk removal service.
- What problem is the product or service solving or improving for people? Answer: I have junk that needs to be removed, but don’t have the means or desire to do it myself.
- What is the value or benefit being promised to customers? Answer: An easy and convenient way to have junk removed from your life.
- Who is the product and/or service for? Answer: 1-800-Got-Junk? has two different categories of customers: businesses and individuals. Both groups of customers have a common need to get rid of stuff they no longer want.
Now that you’ve learned how to create a value proposition statement and have seen some examples, try this practice problem.
Practice #1 Dollar Shave Club
Visit their website, watch the video, answer the four important questions, and use one of the template sentence options above to create a value proposition statement for the Dollar Shave Club. This should take about five minutes. Go!
Now, at the next networking event you attend, you should have no problem telling people about your business idea, because you already have the perfect sentence to describe what you are doing. While you may not necessarily communicate the answers to all five questions on your website or to the people you meet, it’s incredibly important that you and your team are crystal clear on the answers to all of these questions.
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