Defining Your Product Value Proposition. Tips and Examples
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The value proposition is the basis of your marketing and business development strategy. Launching a marketing campaign before defining your value proposition is like polishing the coating of a car that has no engine installed. It just won’t make much effect.
So, What Is Value Proposition?
The value proposition is a statement that communicates to the customer why they have to choose your product. Perfect value proposition attracts customers in just a few seconds. It states clearly what are the benefits of a product that make it unique and worthy.
Sounds easy, but you would be surprised to find out how much time it takes to formulate the right value proposition in some cases. As a design agency, we know how important it is for an effective product design to build the basics, such as a value proposition. Some teams need a series of workshops just to define the value proposition of the product they have already been working on for a long time. Good news – every product has a value proposition. Let’s see how you can find it.
How to Write a Value Proposition for Your Product
The value proposition is often compared to a promise to the customer. To make the right promise, first of all, you need to know whom your product is addressing. Another obvious thing, you need to know all the benefits of the product that customers value, especially the ones that they refer to as unique. Starting from this point, you can ask your team and yourself the following questions:
- How does the product satisfy the customer’s needs?
- What are the customers' goals that the product helps to reach?
- What makes the product different from the competitors?
- How does the product make the customer feel?
If the answers are unclear, you may need to conduct marketing research or a series of interviews with your potential customers. Do not rely solely on the product manager or business developer in defining the value proposition. It is about customers and their relationship with the product.
Value Proposition Canvas
One of the best tools used to define the value proposition of a product is the Value Proposition Canvas, introduced by Dr. Alexander Osterwalder.
Here is an easy step-to-step guide to using this tool:
- Fill in each segment of the canvas above. Analyze your customer, its pains, desired benefits, and customer jobs — what they need to perform to fulfill their needs. On the other side, investigate on products and services side: what are the products that solve customer's problems, creates gains, and how it does that. Each segment may contain a list of points.
- Evaluate the importance of each point for the customer. Top evaluated products that match the top evaluated customer needs are the ones that form the value proposition.
- Test the draft value proposition with customers. If needed, make adjustments based on the test results.
- Analyze the competitive advantage of the company in key elements of the value proposition. Conduct competitors' research to define the steps necessary to ensure that your value proposition is unique.
To learn more about defining the value proposition, check out this book.
Do’s and Don’ts of Product Value Proposition
This is how a good value prop should look like:
- Clear. Go for the words that are easier to understand. When your customer sees the value proposition, it takes them mere seconds to decide if they are interested or no. You don’t want them to waste that time decrypting all those smart words. Even if your target audience consists of academics, stick to the language that an undergrad would understand.
- Unique. An ideal value proposition has something that differs from the competitors. Uniqueness sells, everybody knows it. So take it seriously and run a thorough research on competitors. If you think that your product has no competitors, you have to think twice. It is ok for a product owner to be so passionate about their product that they can not even imagine why someone would not use it. Yet competitor analysis is crucial for defining value proposition, as well as many other stages of product development.
- Short. Fewer words, more sense. This might be the hardest point, but a short value proposition is a sign of the integrity and uniqueness of the product. You will see it in the examples listed below.
And here is the list of things to avoid:
- Don’t try to mention ALL the benefits of your product in the value prop. Too much information is confusing. You either write a detailed exhaustive text or a text that people will actually read.
- Don’t make it too vague (like an inspirational slogan). The value proposition is not a list of abstract “values”. We know that people make most of their buying decisions based on their deep values, and you should consider them in your marketing strategy. While bearing that in mind, think of the tangible benefits of your product. You can make the heading slogan-ish, but the main text has to be as solid and real as possible.
- Don’t start with the “#1 in…” That does not convince the customers in the 21st century. Instead of telling that you are the best, focus on WHY you are the best.
- Don’t rely too much on the video. Let’s say you produced a great trailer that explains all about your product in less than 30 seconds. Your intention might be to place that video on your main page skipping all the extra text. The problem here is that most of the page visitors are not incentivized enough to click on the watch button of the video they know nothing about. So you automatically lose a huge part of your potential customers as they won't even watch it. So, don’t skip the text. It will only help to get more views of your awesome video.
Examples of the Great Product Value Proposition
Finding an example of a value proposition is easy. In most cases, it is the first thing you see on the main page of a product. Here we analyze a few of them to find out what it is that makes them work.
Like Uber, Netflix is close to becoming a generic word for online movie service. Unlike Uber, Netflix still uses down-to-earth benefit statements to engage clients.
Key elements of its value proposition are unlimited access; various gadgets supported; downloadable. And a wide variety of movies and series, of course. On the landing page, they don’t even mention it, just put all those posters in the background. If there was an Oscar for the clearest value proposition, Netflix would be the first one to get it.
Airbnb started by connecting travelers with vacation rentals directly. Now it has grown to a marketplace of experiences, both online and offline. It can be a vacation stay, guided tour to a volcano, live concert, or a cooking workshop.
So, what does Airbnb say now, when they offer so many different services? “Find everything you need to make your next trip memorable or start earning money as a host.” They manage to address both parts of their target audience: guests and hosts.
The next thing you see are short benefits statements, each related to a different service that Airbnb provides: rentals, live experiences, and online ones. Whenever a new service adds to the product, these statements change and the value proposition has to be revisited.
We deliver food and groceries in a flash. It’s our mission to bring everything you want, need, or crave right to your door, whether it’s a meal from your favorite local restaurant or same-day grocery delivery and cleaning supplies.
The key benefit of any delivery service is speed. “Deliver food and groceries in a flash” is a promise that Foodpanda makes at the very first moment. What else makes its value proposition? 24/7 delivery, customization, wide choice including all sorts of goods, not just food.
It has been a while since Uber became a generic word for taxi services. Now Uber does not have to convince its customers that pressing a button is the easiest way to get a ride. The products that Uber offers have multiplied. They now work with food delivery, freight, public transportation, and scooter rent. The variety of products has not changed the main idea of Uber’s value proposition: it is the smartest way to get around.
Just like Airbnb, they managed to keep a general value proposition for all the things they offer, while each one of those products has its value prop, like this one:
This is a great example of the very basic principles of value proposition: short, clear, comprehensive. We see who is the audience: business; what the product is: bulk SMS service; and what it does: sends notifications, alerts, reminders, confirmations, and SMS marketing campaigns. That’s it. No explanation needed.
Such a clear value proposition sets a perfect ground for good design. Learn more on how we designed TextMagic here.
What the company states as its value proposition is innovation and sustainability. It also says clearly that the products are for athletes, with a footnote “if you have a body, you are an athlete”. Professional athletes won’t make a huge market, especially if you consider that they are often being paid to use Nike products, not paying to get them. So, by saying that you are an athlete they appeal to the customers' desire: we buy snickers because we want to be an athlete, or at least be just like them.
Why do these value props work even when they do not follow all the rules? Reminding that you make sportswear is not necessary when you speak for Nike. Brands that are well-known and offer a wide variety of products tend to go on the “values” side of the value proposition instead of sticking to the basic tangible benefits. So, brand value is the main "secret ingredient" here.
Well, the value prop seems to be easy when you are working with a world-known brand. What if your product is not yet at Nike’s brand level? Here at Eleken, we make UI/UX design for emerging products as well. Let’s see the next example.
The product uses a clear and original definition, “distraction-free learning platform”. Why do customers need this platform? To create modern engaging content experiences. Note that the basic value proposition does not mention all the things that the platform provides: webinars, tests, interactive content, etc. You can learn it from the explanation video after the initial statement caught your attention.
Read more on the design solutions we found for PublishXI here.
Want to see more? Take a look at these landing pages that convert to see how the value proposition looks on the best websites.
Examples of the Not-So-Great Product Value Proposition
Insurance app. Too long
This page combines literally every mistake mentioned above. Some businesses operating in “serious” fields such as finance or insurance intentionally try to sound fancy. However, there is a fine line between fancy and incomprehensible, and phrases like “enabling platforms aimed at innovating internal procedures” are way over that line. When you see that the value proposition is over 100 words, including such as "innovating internal procedures", "ecosystem of agile digital infrastructures", it is time to stop.
The text is long, divided into big paragraphs written in small font. It would take a highly devoted reader to go through it till the end – but after that, you can be sure that person would be a lifelong customer of the product.
CRM Product. Too abstract
Chances are you have seen lots of landing pages that hide their value behind good-looking abstract phrases.
The heading says it loud “Go do something great”. Ok, starting with a bold slogan is fine, but what goes next? Few more generic verbs, “imagine, achieve, make” and finally naming the product. If you belong to the target audience, you probably understand what “enterprise collaborative work management solution” means. What you still don’t understand is why you should choose this one out of all the other enterprise collaborative work management solutions.
Online Photo Editor. Too Generic
Which one? Literally any. All of them provide similar services and most fail to explain their unique value proposition. They all can edit photos, crop them, add filters, etc. There are a bunch of them on the market and it would take you a while to find the difference between them (if you would ever try). There are lots of online photo editors available, so the only way to stand out is to do a thorough competitor analysis and come up with the right value proposition.
4 Things to Remember about Product Value Proposition
- The product value proposition is a statement that communicates to the customer why they have to choose your product. To define your value prop, you need to know who your target is, what are their needs, and how your product can help them.
- The value proposition has to be clear, simple, short, and unique. Run competitor analysis to learn how your product is different from the others.
- Don’t use positioning statements (#1 photo editor) and slogans as your value proposition. Focus on more down-to-earth things.
- Take your time to work on the proper value proposition and remember to test it once in a while, as your product, market or customers are changing. Thorough value prop research may give you insights on how to shape your product to bring more value to the customers.
Once you have a solid value proposition, you are one step closer to having product market fit. Check out our article where we explain what is product market fit and why it matters.