Typically, there are multiple people on the buying team, each with their own concerns. Because of this, a strong value proposition must address a few different types of value that it brings to the buyers and their organization, such as:
- Ongoing Value: How they are sustainable and will stay/keep things up and running.
- Added Value: How they can enhance your processes, efficiency, effectiveness, insight, and performance.
- New Value: How they can help you change the competitive rules to enhance success.
A few years ago, I conducted a study of buyers in the technology sector. One question that we asked survey respondents was this:
As you made your purchase decision, how much overall weight (sum to 100) did you give to each type of value?
This is how they answered:
You can see that each level of value carried significant weight and cannot be overlooked. You can differentiate yourself from your competitors by addressing each type of value to your buyer.
As you work on describing the qualities of your product and/or service that make you different from competitors, the biggest challenge is to describe those qualities as benefits to the buyers rather than features of the product/service. One way to address that is to see if your statement reveals at least one of the three types of value to the buyer, as identified above.
Probably the hardest section to develop in a strong Value Proposition statement is the differentiators. The word “differentiator” means the following:
The unique features and / or benefits of a product, or service that set it apart from competing products or services.
The key word here is UNIQUE. This means it must not be something that other competitors have or claim. It needs to set your offer apart and give the buyer a solid reason to pick your offer over the available alternatives. Suffice to say, this is not an easy task.
Oftentimes, businesses stuff as many things as they can think of into the differentiator with the idea that the more they have listed, the better off they are. Wrong! For any differentiator to be valuable, it must be:
- Valuable to the buyer
Of the three components of a strong value proposition, this section — the differentiator — requires real awareness of what your competition is claiming. Let’s review the components of the competitive scan that are most relevant to writing differentiators and the Differentiator Statement: Tag Line, Key Words, and Differentiator.
Perform Competitor Messaging Scan
This analysis is worth doing to get an understanding of what other companies are saying in your market space. Scan the language used: tagline, Value Proposition, differentiators, key words, product / service messaging, and positioning. As part of your company’s development of its product or service, there was likely a full competitive analysis done, to ensure that there is a place for the offer and that it brings something to the table that prospects are going to want to purchase. If possible, access that analysis. Speak to someone who had a hand in the development. This information will be very helpful here. It can help you with actual differences in the product or service itself. But it is necessary to do a “messaging scan” that really focuses on the marketing and sales language used to communicate with buyers. You are looking to identify two things:
- The words, phrases, and attributes that your competitors use – so you can completely avoid them, to keep from sounding like you are jumping on someone else’s bandwagon.
- Any gaps which may represent opportunities for you to fill in your own messaging to differentiate your offering.
For the purposes of this value proposition work, focus on the unique features, benefits, and differences from the other available alternatives. However, beware of focusing on any feature that is currently unique, because the clock is already ticking until a competitor goes after it, and replicates or one-ups it! Focus on value – definable, ongoing value that can be backed up with proof. This is what buyers are really looking for as they evaluate vendor solutions.
Be sure to focus on the QUALITY of the differentiator, not the quantity. One or two true, believable, and provable differentiators are worth more than a bunch of generic, vague items. Here are some steps to get you ready to work on your differentiators:
- Review your competitive messaging scan
- Where are there gaps that your offer can cover?
- Are there any opportunities to “own” a particular feature or benefit?
- Can you deliver more than what is available from competitors, or one-up what they are claiming?
- Restrict to 1 – 3 differentiators at a maximum
- It is rare that any legitimate offer truly has more than this.
- If you have to stretch or be vague to claim it, don’t.
- If you can’t offer proof, it’s not going to be viewed as important or real.
- Must be truly differentiating
- It must be provable – objective third-party proof is best.
- It should not be already done by primary competitors.
- Focuses on overall value, not the details of the features or benefits
- Includes at least one of the three types of value (ongoing, added, or new)
Instructions for Developing Differentiators
Now, take a shot at creating some meaningful differentiators. Using the preparatory ideas above as your guideline, develop 1-3 differentiating points that are better, unique, and otherwise different from the alternatives offered by your competitors.
- Make sure they are real and specific – not general or self-serving statements like “we have the best customer service in the industry.”
- Make sure the differentiators tie back directly to the Buyer Objective Statement, and logically extend from the Offer Statement.
The differentiator should also be something that your buyer actually cares about. Even if it is different and unique, but ultimately not something of meaningful value to your buyer, then it is not worth adding to the Value Proposition. There are lots of differentiators out there. But depending on your target audience, the reality is that not all of them matter.
Here are a couple of examples of Differentiator Statements to give you an idea of the direction you should be going in when starting to develop this section.
Our customers have achieved documented savings and efficiencies that range from 15 – 35%, and we are the only vendor that has exceeded government-mandated accuracy guidelines for 5 years in a row.
From 2000 to 2010, health plans that utilized XYZ’s cost management services, solutions, and technology have saved over $2.5 billion in non-network medical costs. We are the principal cost containment partners for 9 of the top 10 of the largest health insurance companies in the United States.
You can see these differentiators are short and sweet, no fluff or fat. They offer compelling claims that can be easily verified. Try to emulate them. Differentiating your product or service in a relevant and provable manner is the key to winning the hearts, minds, and signatures of your prospective buyers.