Value propositions are essential in business strategy, summarizing the benefits of a product or service to persuade customers. They must resonate with potential buyers, differentiate from competitors, and be substantiated with evidence of promise delivery. A well-crafted value proposition addresses five key elements: target audience, problems, scope, solutions, and benefits.

1. Winning Value Propositions
July 2012
Jedii

2. Why Value Propositions
• Creating a value proposition is a part of
business strategy. Kaplan and Norton say
"Strategy is based on a differentiated customer
value proposition. Satisfying customers is the
source of sustainable value creation."

3. What is a Value Proposition?
• A value proposition is the collection of reasons why a
person or company benefits from buying something.
• A value proposition is the solution to your
customer’s problem. It goes hand in hand with the
problem you are solving. I am a customer, I walk in
with a problem, I walk out with a solution. The
solution then is not your product or service, but the
solution your product or service provides. i.e.: the
end result, the value given to the customer.

4. From Investopedia
What Does ’Value Proposition’ Mean?
•A business or marketing statement that
summarizes why a consumer should buy a
product or use a service.
•This statement should convince a potential
consumer that one particular product or service
will add more value or better solve a problem
than other similar offerings.

5. Investopedia explains Value
Proposition
• Companies use this statement to target
customers who will benefit most from using the
company’s products, and this helps maintain an
economic moat.
• The ideal value proposition is concise and appeals to
the customer’s strongest decision-making drivers.
• Companies pay a high price when customers lose
sight of the company’s value proposition.

6. Reasons why people buy - Winning
Value Propositions
• Potential buyers have to need what you’re
proposing. It has to resonate with them.
• Potential buyers have to see why you stand
out from the other available options. You have
to differentiate.
• Potential buyers have to believe that you can
deliver on your promises. You have
to substantiate.

7. Resonating Value Propositions
• Deep knowledge and understanding of
challenges of the target segment(s) of
users/buyers, and what they mean to them.
• Belief about the most important benefits of
solutions, provided to the target segment
based on experience, data, proof.
• Price, schemes, and variations considering the
challenges and the benefits (above).

8. Differentiating Value Props
• Better, Faster, Cheaper
• First, Different, Great
• Stability, Flexibility
• The idea is to identify critical attributes of
competitors’ offerings, and identify the attributes
that are the most discouraging for potential buyers –
and then to identify opportunities to conver those
into our Differentiators.

9. Substantiating Value Props
• Value props could be substantiated based on
identical or similar value props’ Track Record,
Endorsements, Recommendations, Analysis
Reports, Demos, Trials, Expression of
Conviction, etc.

10. The Three Legs of Winning Value
Propositions

11. Creating the Value Props – Think…
• Target Segment – The people who will buy
• Problem(s) – The problems they struggle with
• Scope – The scope that our value prop will address
• Solution – The offering that is our value prop
• Benefit(s) – The benefits people can expect
Contextual thinking of the above aspects leads to concise statements of…
• Value Proposition(s)

12. The Value Proposition Formula
• We help [your most promising prospects] that
[need help with their pressing concerns you
address] succeed by [providing the material
improvement(s) you will deliver]. Unlike [the
alternative solution], [your solution] [describe
the reason why your company is a better
choice] as demonstrated by [evidence that
you will deliver as promised].

13. To add value to Thinking
• Try if doing this thinking/discussion in
workshop mode works better for you. Usually
it does, with the right people involved.
• Do the contextual thinking and drafting of
Value Prop statements in the same session.
• Force the Value Prop Statement(s) to be
concise and crisp, must be clear and coherent.
• Generate divergent thinking before
converging – SCAMPER

14. Sample Value Props
• Look at some sample statements of Value
Propositions and identify how they Resonate,
Differentiate, or Substantiate.
• Also, rate each Value Proposition on a scale of
1 to 10, 1 being poor in effectiveness and 10
being outstanding in effectiveness as a value
proposition.

15. Summary
• Value Propositions are the most important
first step in communicating why your offering
should be bought.
• VPs need to Resonate, Differentiate,
Substantiate.
• VPs must address (5) Target, Problem, Scope,
Solution, and Benefits.

16. Thank you!