At its core, running a business is straightforward: You provide a consumer with value of some kind, and they provide you compensation.
A business owner cannot realistically expect to be compensated if he is unclear on the value he is offering or is unable to articulate it.
That is where having a “value proposition” comes in.
A value proposition summarizes why a consumer should chose your products over your competitor’s. It should convince customers that your product or service would solve a problem or fulfill a need better than those others are offering.
Does your business have a value proposition? It should.
Small-business owners should care about their value proposition because it is the foundation of their success, says Elijah May, the managing partner of The Experience Firm, a marketing and public relations company.
May says that, sadly, a huge percentage of businesses don’t really realize what business they’re in.
The more competitors you have offering similar services, the more you need a value proposition that’s unique.
To illustrate this, May discussed two footwear brands: Toms Shoes and Jimmy Choo.
Toms Shoes offers the same basic value proposition as most shoe companies: Feet are safer in shoes. But what makes its product unique — its true value proposition — is that when customers buy a pair of Toms, a free pair is sent to someone in need. It’s kind of like fair-trade coffee, and it makes the brand stand out.
Jimmy Choo shoes, on the other hand, might raise a consumer’s social standing, which to some, justifies a high price tag and makes the brand memorable.
In each case, the shoe purchaser is making a clear choice.
So, how can you make a unique value proposition work for your business?
May says small-business owners need to know basic human psychology. Most people have the same fundamental wiring, he says. Once you understand they are just trying to fill the same needs, you can start to communicate directly and effectively aboug how your business is going to meet those needs.
To help people embrace this way of thinking and begin to describe what their small businesses have to offer, May teaches a class called “How to make your customer CURSE.”
Here is his thinking:
If they don’t Care they’ll never understand.
If they don’t Understand they’ll never remember.
If they don’t Remember, they’ll never share.
If they don’t Share they’ll never engage.
If they don’t Engage, they’ll never be part of a community that wants your business to succeed.
Anyone trying to sell a product of any kind needs to take the time to understand what specific emotional (or physical) need it fills for the consumer. Knowing the needs and wants of your customers is essential.
And remembering that those needs and wants do not stay static will help you to continue to move your business forward.
Ann Marie van den Hurk, annmindthegappr.com, is author of “Social Media Crisis Communications.” Follow her on Twitter @amvandenhurk.