Knowing your product intimately can often lead you to get caught up in the technical complexity of what you’re selling.
For example, your product may be the best chemical isomer on the market, but if your customer doesn’t have the background knowledge they need to be able to understand the jargon in your value proposition, you’ll likely have trouble selling your product.
What is a value proposition? It is a statement of the unique benefits your product will deliver to your target audience. The value proposition is critical to marketing success when starting a business.
During a lecture at Entrepreneurship 101, Joe Wilson, education advisor at MaRS, explained why every business needs a strong value proposition.
Joe examined the three questions a value proposition should answer:
- What is your product or service?
- Who is your target customer?
- What value does your product provide?
He used discount store Winners to give an example of a good value proposition:
“Winners is a department store that offers fashion-conscious consumers the latest brand names for up to 60% off.”
- What is your product or service? Department store.
- Who is your target customer? Fashion-conscious consumers.
- What value does your product provide? Latest brand names and up to a 60% discount.
In this example, the value proposition is clear, focused and identifies everything that sets Winners apart from other, similar stores.
When crafting your value proposition, Joe says, you should target a niche market. Your product might benefit everyone, but when your focus is too big you dilute the value proposition.
The final takeaway from Joe’s lecture was the importance of the value proposition in the development of other marketing tools. With a strong statement acting as the core and call to action, you can easily create your elevator pitch, tagline and mission statement.
Check out the video from Joe’s lecture for more insights and examples.
This content first appeared on MaRS.