In my last blog post, I talked about the real need to fully understand and communicate what drives the buyer to buy – figuring out and netting out the most important Value Drivers as a key component of a Value Proposition Platform™. Now, let’s zero in on the really tough part: how to quantify the importance of that value, and to offer solid proof that your product delivers that value. As part of my Value Proposition Platform™, these three elements - Value Drivers, Quantification, and Proof Statements - to back up your value proposition are critical to meeting the needs and piquing the interests of various buyers, and to ensure proper focus on what buyers need at different stages of the buyer’s journey.
Here is a list of value drivers for our example company that is focused on finding a vendor that has good market analytics information. These represent the key values that are front of mind for them in their vendor evaluation.
Each of these value drivers need to be backed up with Quantification and Proof to validate and make them real for the buyer. Let’s at the finer points of quantifying and offering proof.
The next step is to build a case for the Value Driver, to make it tangible. If the buyer values the “Immediacy” of information about their brand, then how can we quantify the importance of that driver? It’s the “show me, don’t just tell me” that supports the underpinning of your overall value proposition. There are a variety of ways to quantify this. Depending on the status of your offer, whether it is new or well-established, there are multiple options for quantification.
Options for Quantification
In the case of a brand-new product or service where you do not yet have actual customers, explore what is possible by doing some research for supporting quantification points. Reviewing outside secondary research can be very helpful. Or, you can conduct your own primary research via surveys or buyer interviews. But until you do this step, your new product or service Value Drivers will be just ideas.
It is important here to note that this must be factual information, attributed to a credible external third party who is talking about the substance of the Value Driver. It can be specifically about your product / service or be factual data about the topic. This is absolutely necessary to build credibility around the premise that your offer delivers on this value point for the buyer.
The final piece of your Value Proposition Platform is providing the proof points that will support all your value messaging. This step is key to backing up all the major statements you are making about your product or service. It is the concrete that helps solidify the offer in the eyes of the prospect or customer. It is the key tool that all salespeople need to move a buyer through the later stages of the buying process.
To make your value proposition stand out, your Value Drivers need to be relevant, quantified and provable. Why? Because otherwise you are just delivering “marketing speak” that may sound pretty but is not believable to your audience. Buyers are sophisticated and can gather plenty of information about your offerings and their validity on their own. By providing “Proof,” you can shorten the sales cycle, address uncertainties early in the process, and set your offer apart from alternatives.
So, what does Proof look like in the context of a value proposition? Ideally you should have 1-3 proof points to support each Value Driver and its quantification. As a product or service offering ages, you can replace weaker proof points with stronger ones—better customer testimonials, stronger case studies, perhaps more awards.
Options for Proof
Think of Proof as an objective and unbiased opinion to support the fact that your offer delivers on the Value Driver. When you are looking for Proof points, consider what your specific audience will see as valuable input to their decision-making process. Try to view all of this through your prospects’ eyes.
To get started, answer the following questions:
Compile the results of these questions, then evaluate which pieces of information would provide the most credible Proof of the Value Drivers. Keep in mind that you do not want to rely on “weak” Proof. Evaluate all the proof points that you gather, then focus on the one or two for each Value Driver that are strongest and most relevant to the essence of that Value Driver. What if you can’t provide proof of any kind? That’s a strong sign that this value driver is inherently weak. Go back to your initial list of value drivers and see if you can develop a stronger one by adding quantification and proof. This process helps you really nail something strong that resonates with a buyer – as opposed to just a point that you want to drive that doesn’t have the gas to get you there!
If you are creating different versions of your value proposition, you may need to augment your drivers or replace some of them with others – depending on the markets and buyers that apply to the additional versions. If you have different titles that are part of a buying team, the salespeople will need Value Drivers, quantification, and proof points that are aimed at each key role. Some of your core Value Drivers will apply across buyer types, while others may be role or industry specific. The beauty of this modular approach is that you can add, move, or vary each piece to serve the buyer you are targeting – and still adhere to the integrity and consistency of the value proposition message you are trying to get across.
Looking for more value proposition ideas and approaches? Watch my webinar on the Sales Expert Channel on BrightTALK: Value Prop Clinic - Fixing a Broken Message
I often get asked for the “right words” that will make a value proposition appeal to buyers. Many B2B companies wonder why their value props are not hitting the mark as often as they’d like. Given that the buying and selling process has grown more sophisticated, it can be hard to figure out what is going to engage buyers most. Actually, figuring this out is easy and hard at the same time. The secret sauce? We need to really understand and communicate what drives the buyer to buy, how to quantify the importance of that value, and to offer solid proof that your product delivers that value. As part of my Value Proposition Platform™, the Value Drivers, Quantification, and Proof Statements that back up your value proposition are critical to meeting the needs and piquing the interests of various buyers, and to ensure proper focus on what buyers need at different stages of the buyer’s journey. Let’s focus on Value Drivers first.
Developing Value Drivers
The first place to go is the buyer’s needs and ask yourself: Have I chosen just those needs that we can legitimately address? How does our offering stand up to them? What is really and truly differentiating? This is crucial to having the “back-up” that make a value proposition statement really stand out.
Keep in mind that a well-thought out Value Proposition Platform™ will give you all the supporting factors which you need to deliver a solid, consistent and buyer-focused message across all modes of marketing and sales communications:
What is a Value Driver, Anyway?
It is a set of key words that quickly highlight the most important value points that are front-of-mind for the buyer as they work through their buying process. It helps focus your messaging to center on the points that a buyer considers first in every decision around your offer category. It extends the Value Proposition beyond the statement itself. It forces the discipline of figuring out what ARE the key value points for your buyer? Once you’ve come up with these key words, then you have a couple of tests that will help you decide if these value points really are the right ones.
Test 1: Can you quantify the value point?
Quantification can be done in a couple of ways. The first is to approximate any subjective aspect (attribute, characteristic, property) of the stated driver into numbers. It can take the form of things like statistics, actual numbers or metrics, survey results. The second method is to use hard metrics that you already have collected and use them directly to back up the point. These are real numbers or percentages that measure things like increases or decreases in factors that buyers’ value. If you can’t come up with quantification using either method, then how important do you think that driver really is for inclusion in your Value Proposition Platform? Is that Value Driver actually real?
Test 2: Can you prove that your offer delivers on the value point?
Proof is all about credibility. What makes it credible is when it has been validated by an objective third party. This means what someone or something OTHER than your company says about the product or service. Buyers expect you to say good things about your own offer. Most buyers take that with a grain of salt. Quantification and Proof take the “claims” of your Value Drivers and elevate them to real, provable points that will flesh out the Value Proposition in a tangible way. In effect, it “certifies” that it is real.
To create a set of Value Drivers, begin by answering the following question:
What are the most important values that guide your buyer in considering products or services in your offer category?
Notice that the question is not about the most important features of your offer. These values should relate directly to the needs of your buyers and what is important to them.
Your product or service might have the best features in the world. It may even be the only one in the world (for now - but beware of competitors who may add it soon). The key is to identify and articulate what it is about that feature that delivers something of value to the buyer. One way to start this section is to look at the business issues of your buyers that you have identified and the Value Proposition statement to pull key words out.
Here are some options that a buyer looking at vendors of social media market analytics might find important:
The next step is to take this list and boil them down to one or two words. Your list now looks like this:
The advantage that you get from boiling the phrases down in this manner is many-fold. First, you now have a key set of topics that you can build content around – blog posts, articles, whitepapers, etc. Secondly, each of these enable salespeople to conduct highly focused sales conversations on the most important aspects of the offering – without focusing entirely on features. It enables a VALUE conversation. The modularity of this approach provides consistent messaging and vital flexibility. You can lead with any one of these drivers, depending on what most interests the buyer at any given point in time. Or you can choose to zero in on a particular driver in different kinds of content. This is so much better than the typical “elevator pitch” approach to Value Propositions!
Now, edit some more! Focus on no more than five Value Drivers, as buyers won’t retain more than that. Of this list, narrow it down to just those Value Drivers that you can provide some “meat” with when you’re discussing them. By meat, I mean being able to quantify the Value Driver in some way and then offer objective Proof to support the Value Driver. With those two items - Quantification and Proof - the value point stays on the list. If you can’t quantify it in some way, or you can’t offer some form of Proof, then it obviously is not a strength of your organization, and therefore is of no advantage to including it in your Value Proposition Platform.
Boiling down the Value Drivers this way is an excellent exercise to keep the focus on the buyer, guide key marketing messages, and serve as good talking points for salespeople. Any salesperson will be happy to receive a list of key values that are important to the buyer, with a way to strengthen the conversation with data points and proof points. It’s worth the extra steps to have these additional pieces to make using the Value Proposition clear and consistent across your marketing and sales channels.
In my next blog post, we’ll work through how to quantify each value driver to validate its importance in buyer terms, and options for objective, 3rd party proof to drive it home.
Till then, here’s a refresher on the Value Proposition Platform™.
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:
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:
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:
For the purposes of this value proposition work, focus on the unique features, benefits and differences from the other available alternatives. However, beware on 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:
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.
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.
In a buyer-focused value proposition, your Offer Statement is the logical extension of the Buyer Objective Statement (our previous article). Based on research and experience over the years, I have come to understand that it is imperative to address both personal benefits as well as organizational benefits to potential buyers. This is why we begin with the Buyer Objective Statement. The key now is to extend that as you create your Company Offer.
Your Buyer Objective Statement has articulated your understanding of the problem the buyer is trying to solve. You want the Offer Statement to communicate HOW your offer is going to address those specific business needs of your buyer. You want this statement to precisely express the primary reasons that your offer can help them. But be careful here. You don’t want to include everything there is to tell about your offering. Why? Because your buyers don’t care about everything! They only care about what is relevant to their own needs.
Furthermore, this must be compelling because you are trying to set yourself apart and gain their attention. You want buyers to say “Yes, that’s me!” when they hear this statement. Often, this section will get morphed into the core part of an elevator speech. Think about the one or two things about your solution to their business needs that you want them to have top-of-mind. This isn’t about product features. This is about the value of the solution you are offering to them. Beware of stuffing features in here to prove value. Don’t dilute your message with non-essential information. The real value here is in your ability to MEET THEIR NEEDS. Features are merely a means to that end. What value will they derive from adopting your solution? That is the question!
Beware of “Marketing-speak”
Another essential aspect of this section is making sure your Offer Statement is understandable to your target market. Understandability is a huge point here. Just because your Marketing and Sales people understand it, there is no guarantee that your new prospects or existing customers do. Acronyms, or very technical language, or internal company jargon typically end up in this section. It complicates the statement unnecessarily. It can also make your buyer feel underinformed. If your audience doesn’t know what it means, many of them won’t bother to find out – they will just move on.
Similarly, be sure to weed out all traces of “marketing-speak” in your offer. By that I mean generic, fluffy marketing language that doesn’t mean anything specific. If it doesn’t directly apply to the business needs in the Buyer Objective, then it doesn’t belong in the Offer Statement. It should be tight, clear, and in the language of the buyer. Value Propositions do not come with “translators,” so don’t put a prospect in the position of needing one.
Finally, but most importantly, you need to be able to quantify all of the claims you make in this section. If you say that you increase productivity, then you need to be able to say by how much with a specific number or a range. If you can’t articulate it, it will not be credible to the buyer. Anyone can say they increase productivity or reduce costs or help with generating additional revenue. Without Quantification, it isn’t unique or differentiating – it is vague, “me too” language that ends up just being an exercise in “marketing-speak.” Make your quantification real by being specific and backing it up. Otherwise, it simply isn’t believable, and therefore has no place in your offer.
With all those additional suggestions and guidelines, let’s work on the Offer Statement. You’ll do multiple drafts of this section – and to keep on track, refer to your latest “Buyer Objective” statement to ensure that you are connecting your offer there. A good rule of thumb in crafting this section is to ask the following:
Can everything in our Offer Statement be linked back
to the buyer needs we have identified?
Any parts that do not connect to the buyer’s needs gets cut out. Don’t stuff your Offer Statement with things that are not relevant to the buyer’s needs.
Instructions for the Offer Statement
Let’s take a crack at crafting an Offer Statement. Here are a few simple basic guidelines to follow:
To illustrate, here are a couple of real examples of Offer Statements, to give you an idea of the direction to go in. Notice that they stay pretty high level and, by design, do not include too much detail. They do not include all the features of the offer. The value proposition is meant to attract buyers. By matching your Offer Statement to the buyer objective, you are building the means for that attraction. Remember, this is just the beginning of conversation – not the entire conversation.
In response to these client and market needs we have focused our healthcare and professional services resources, along with our technology, information system and work process re-engineering expertise to create and deliver the following business benefits and results:
[Product Name] is an application deployment and management system that dramatically reduces the time and effort required to launch and manage applications on business-critical servers. Proven to scale across thousands of servers across geographic regions, the system delivers the ability to deploy, troubleshoot, repair, upgrade, operating and manage servers from a single system.
Making sure your Offer Statement is firmly based in the Buyer’s Objectives is possibly the most important aspect of the creation of a customer-focused value proposition. Your company will distinguish itself from the competition simply by taking these steps to ensure that the solution you are selling matches up with the problem that needs solving, and then making that crystal clear to the buyer.
The fastest way to earn a prospect’s trust, and potentially close the deal, is not by extolling the benefits of your product or services; rather, it’s by demonstrating your knowledge of and concern for your prospects’ challenges. I invite you to listen to this podcast where I am interviewed by Vanessa Haney of Salesforce.com. Listen Here
Buying decisions, even in the most antiseptic of business transactions, are still handled by humans. Therefore, the negotiations around buying & selling anything have a significant emotional component. As marketers our goal is to identify and understand the underlying motive in our buyer’s mind, and then intelligently connect our wares to that motive. Creating a value proposition without a firm grasp of the buyer objectives of your intended market is like trying to hit a bullseye on a dart board while blindfolded. If you don’t know why a buyer is looking to buy, how will you know what aspects of your product or service to feature? The default is to include everything – which is always too much. The real goal is to net out your message to only what matters to them, and then articulate it simply and clearly – a tall order!
Your first goal is to identify the buyer’s objectives, and then to be able to articulate it in the buyer’s “language.” Oftentimes, the weakness of the buyer’s objective is that even if it is properly identified, it’s still presented in marketing-speak, not in the kind of language that real buyers might use. Rarely are their objectives summed up with a neat, tightly-written sentence, lumping multiple disparate issues together. Each one of those issues may impact a different aspect of the business - very different buyers make those statements.
For instance, the CEO and CFO talk about stakeholder expectations. IT probably manages the compliance frameworks. Market volatility concerns senior management as well as Marketing, Product Development, Business Development, and Human Resources. I could go on, but the point is “enterprises” are not buyers. Who buys products like enterprise software? Executives of business units, IT, and finance, as well as consultants and other internal advisors. They are sophisticated buyers with a highly-developed sense of what is relevant to their specific business needs in any value proposition that is presented to them.
As you work on your own value proposition, make it a priority to find the buyer’s language. Remember this rule: simplicity is your friend. And its corollary: complexity is your enemy. If your audience needs to “figure out” your value proposition, they won’t – and you’ve lost them.
Start the Value Conversation with Your Buyer
So how, exactly, do we create an accurate buyer’s objective statement? Glad you asked! Here are three seemingly simple tasks, which in reality will require a great deal of discussion and revision.
IMPORTANT: You will go through multiple drafts of this. That’s exactly how to do it! It’s a process. You want to be extremely comfortable with the buyer statement BEFORE you start the next section of your value proposition, which is your company’s offer. Do not move ahead, even if you think you can do this all at once. Trust me, you can’t. If you skip over this first section, or rush through it quickly without much thought, your value proposition is going to end up being the same weak dog & pony show, more focused on promoting your company than on resolving your buyer’s pain. Unfortunately, this is exactly what the buyer hears all the time from every vendor. Your goal now is to do something different, and talk about things from the buyer side. Why? Relevancy and differentiation! It really is a breath of fresh air for buyers.
As you build the Buyer Objective Statement, it is crucial that you do not allow your company offering to creep into it. Don’t worry, that part comes next! When you are done, you’ll have a grouping of three sets of statements: Buyer Objective, Company Offer, and Differentiator. Ultimately, you will boil them down into a single tight statement, but for now let’s nail this Buyer Objective Statement part.
Help Your Buyers Look in the Mirror
Consider a couple of examples of Buyer Objective Statements, to get an idea of the direction they take. Notice that they do NOT include anything about their products or services. As you read the following samples, notice the issues that are presented. See if you can tell WHO the buyers are as described in this statement. Buyers should be able to see themselves in this type of statement – and calling out the buyers in the actual statement makes this easier and more direct.
Employers, insurers and claims paying organizations are rightly concerned with the increased costs of their workers’ compensation, group health, and auto liability programs – but their cost control efforts may not generate the desired goal. Payer issues include increased claims volumes, medical cost containment, and medical abuse and overuse. Meanwhile employers are dealing with rapidly escalating total costs and rising claims severity.
IT organizations across every industry who are trying to lower the cost and risk of managing their critical applications should ask themselves the following questions:
As you can see in both samples, the buyer is called out by name, and the issues are clear, simple and direct. You do not need a translator to figure out what the business needs are – even if you’re not a member of either industry. Clarity is imperative!
Avoid Top Message Weaknesses
In my experience, the top weaknesses associated with the Buyer Objective Statement include:
A crucial first step in crafting a Buyer Objective Statement is identifying key words that buyers use to describe their situations, goals, needs, and business pain. When a buyer speaks, we need to just listen for a while. And not just to their overall message, but specifically to the language they use to deliver that message, whether they are referring to their industry, their company, their problems, their successes, whatever. As in any cultural meeting, it is vital that the parties involved are speaking the same language. Research the buyer’s company web site, and their marketing collateral. Learn to speak like the buyer speaks.
The other side of this coin is to beware of industry jargon, and your own internal company-speak. Relying on industry jargon immediately tells the buyer that his/her issue is being lumped in with every other organization in that industry. But we know that every buyer believes his/her problem is unique! So, you lose points the minute you start using common jargon to discuss their business. You lose even more points if you veer off into your own organization’s language, because chances are your buyer does not use the tidy little terms your organization has come up with to describe business issues. It is not incumbent upon the buyer to learn new terms. Make sure that you do the research and use buyer language to ensure relevance.
Remember: One-Size-Fits-All Fits No One
As mentioned above, the buying team is a multi-headed beast. And each of those heads need to be fed. As such, you will need different Buyer Objective Statements for different buying groups or audiences, or for major differences among products and services. This is crucial, but not as daunting as it may seem. Oftentimes, it’s simply a matter a tweaking the focus on certain aspects of the overall value proposition you’ve created. For example, a CFO may not expect every business proposal to be primarily about the financial terms, but he/she does find it refreshing when those concerns are given proper attention as part of any offer. Likewise, with the IT group, or any other stakeholder in the buying decision. Make sure each interest is acknowledged!
The creation of a Buyer Objective Statement is not a simple or easy thing, but going through the process of creating it brings your entire value proposition into focus. Your products and services are no longer simply existing in space, waiting for a buyer. They are now a solution, there to solve specific problems. This turns a sales pitch into a collaboration!
We know that one size does not fit all, in anything, ever. So, it stands to reason that if your value proposition is focused and aimed at one specific decision-maker or organizational role or business issue, you run the risk of distancing or even boring everyone else involved in the purchasing decision. A big risk, because their opinion counts! The most effective value propositions are those that anticipate the needs and concerns of all buying team participants.
I’ve done some research of B2B buyers in the technology realm, and found an array of business roles involved in purchasing decisions:
Technical Decision Maker
Business Decision Maker
Executive Decision Maker
Financial Decision Maker
The primary focus of the buyers broke down like this:
And, just to make it more interesting, we analyzed the decision-making styles of buyers:
This knowledge shines a light on the futility of a one-trick pony value prop. There are a number of varied interests and personalities involved in most purchasing decisions. You can’t go in there armed with only one focus.
Knowing is the Path to Relevance
If relevance to the buyer is the most critical element in a value proposition, we need to deeply know and understand the buyers. Our research told us that only two-thirds of value propositions were at all relevant to buyers, and at best the range of relevance they experienced topped at 70% with the lowest at 30% relevant! As both marketers and sellers, we have tremendous room for improvement here. Where else in terms of strategy or tactics can we find that scope of opportunity to gain an extraordinary advantage in the buying process?
The key to differentiation resides squarely in our ability to be as relevant to the buyer’s experience, needs, wants, challenges or objectives as we can.
This focus on relevance immediately differentiates you by default, as most of the competition will be too busy chattering about their own company and their own products and services, to the exclusion of their buyers. Think about it. That could be where you are right now with your own value proposition, right?
But if your company wants to make relevance the focus of your value messaging, you will have to dig very deep into learning about your buyers. You may think you already do, but are you sure you really know the market dynamics that are impacting their business – from their point of view?
Start from the beginning: Who Are Your Targets?
The brief review of the buyer demographics cited above should give us all pause. All these buyers, or people like them in other purchase scenarios, will make up the group of buyers for any big sale from your company. The research confirmed that they will demand relevance to their business issues. While there are themes and possible similarities across different industries and buyers, you and your team must discover exactly what YOUR buyers’ specific business issues are. Uncovering this foundational perspective will go a long way to helping you to explain your products and services in such a way that resonates with the buyers.
Let’s clarify everything that you’ll need to learn about the buyers before you begin to construct your value proposition:
Segmenting your market
We need to divide our broad targeted market into just those who have a common set of needs, priorities, and goals that we can address with our product or service. Identification of targeted sectors or industry or sub-industries is an important step in setting the stage for developing the value proposition. What are your primary sectors and industries? What segments within them do you target? Another way of looking at this is to ask, “Where are we going to aim our marketing and sales efforts?” We want to identify the best-fit targets that will be receptive and have a need for your offerings.
Here are key criteria for defining a market segment:
Titles of Decision-Makers
There are literally thousands of titles – and variations of titles. Focus on those titles that have issues, challenges, or goals that your offering can help address. Are there any core or specialty titles that are important to the decision-making process for your product or service? When you look at those titles, how much responsibility do you think that role holds? This will help you identify the decision maker(s), the influencers, and the users of your offer. Your sales team can help you here as well. Who do they call on? Who are the ultimate deciders? Who must not be left out of the sales conversation and purchase process? When you start to consider titles, here are the key areas consider:
Decision Roles Areas include:
The Influencer typically provides research, information, and opinions that contribute in a material way to the purchasing process. In mid-size and larger organizations, they are responsible for a large part of the information gathering needed to evaluate the product or service.
One more important consideration you need to make is when you include the Chief Executive Officer and / or the Chief Operating Officer, or the Chief Financial Officer – or any of the other “Chiefs” out there. In the case of the CEO or COO, think of them as being primarily focused on the larger business from both a strategic and operational point-of-view. They are guiding the overall direction across the company and may or may not be directly involved in your product or service purchase decision. So, don’t just arbitrarily add them – as messaging to them should have a much different focus than to lower titles in the company. Is the purchase decision about something that is significant to the overall direction of the organization? Is it part of the funding provided for a major strategic initiative? What is the size of the organizations that you are targeting? In small and medium sized businesses, they may be involved in many more of these decisions directly than in an enterprise company.
As far as the CFO, you can count on the fact that if your offering has a high-ticket value, he or she will definitely weigh in. But if not, you will need to plan for a senior financial person or budget holder to be a key influencer. The one that holds the purse strings can be a deal breaker – never underestimate that! You will need some financial positioning added to your core value proposition to take care of this.
Now you know WHERE and WHO you are aiming at. The next component is to identify the key business issues these buyers have that you want to address with your offering. Business issues include the following:
Generate a list for your selected decision makers. Then look at your influencer titles and think about whether there are additional issues specific to them that could come into play, or is there another aspect of the business issues that the influencers might have in mind? Remember, the trend for medium to larger businesses is to have multiple people as part of the buying team. Be sure to consider how that impacts the business issues you link to your value proposition.
Typically, you are not selling to a single buyer; you are selling to a multi-headed, multi-tenacled buying team. To build a successful value proposition, you need to identify each of those members and address their concerns in equal measure. Knowing their business and anticipating their concerns is half the battle to making the sale!
Understanding that your value proposition must be relevant to your buyers’ needs is a long way from actually creating a value proposition that fulfills all the needs of all the buyers throughout all stages of their buying journey. Many variables come into play at different stages, and your sales team needs to be equipped with information about how it all works and what messages belong in the playbook at each stage. Your first job is to gather information on all the key areas of importance. But before you start to put any words into the mouths of your sellers, you need to do some research.
You need to hear the buyer’s point-of-view - their words, right out of their own mouths. But you also need to do some internal research. It’s a good idea to learn what your own people think your value proposition is right now. Talk with your marketing, sales, customer service, and product management people. I promise you, that will be enlightening! The combination of external and internal research will provide a solid foundation for you to begin developing your value proposition. Here is some more detail on each of these areas.
Interview Your Top Sales People
Hold a round table discussion with your sales leaders, to get their “selling” language and perspectives on the table. The better questions you ask them, the better answers you will get. Here are some of the types of questions you should be discussing with your sales leaders:
Answers to these questions may prove illuminating to all involved. You should capture all of this feedback from your sales team and be sure to share the results with them. But don’t stop there – you’re just getting started!
Mine Customer Service and Support
In many organizations, Sales gets the customers in the door, but Customer Service keeps them there. So, it makes sense to do the same type of roundtable with some key reps from customer service and support, both inside and field support people, if you have them. Service staff often knows a LOT of information about the customer experience that sales does not. This can uncover common challenges they may be having, product or service misconceptions or issues, and much more.
Often customer service is overlooked for this kind of research because often there is a misconception that it may all be about bad news. Quite the contrary! Ask them for trouble tickets or chat room dialogs that reveal language customers use when describing your products and services. How do they describe their difficulties, and what kind of changes do the service people make for them? This will help you get closer and closer into the lives of your customers who actually interact with your products or services on a daily basis. Use those questions listed above, as many of them will also be relevant for conversations with your service people as well.
Conduct Focus Groups with Customers
If you can afford it, focus groups are an excellent way to get at the business issues that your customers are trying to resolve. It’s not always a problem, you know. Maybe they are looking to solve problems, but maybe they come to you to gain advantages of speed or product innovation or fantastic customer service. A focus group allows you to listen in as they discuss their business issues. The interactions that focus group members have with each other can uncover a lot of very important and relevant attitudes, understandings, misconceptions, competitive insights, desires, needs and language that would be extremely helpful as you begin to construct your value proposition “story.”
Survey or Interview Key Customer Groups (New, Happy, & Former)
As an alternative to a focus group, or in addition to it, you can survey or do telephone interviews of your customers. It is most helpful to do this with a mix of brand-new customers, happy current customers, and former customers. This will yield a bounty of priceless information in the buyers’ own language. Understanding why a new customer just made a decision in your favor can give key insights into the actual buying decision while it is still fresh. Understanding what makes your longer-term customers happy is also crucial information to gather.
And finally, to achieve a 360-degree view of your customers’ experience and thoughts, it can be extremely revealing to get input from customers who have left you and moved on to competitors or to an internal solution. Why exactly did they leave? What was the compelling event? How did a competitor convince them to move to a different option? Or did we do something to chase them away?
In each of these groups, be sure to sample people from each of your decision-maker titles as well as a couple of key influencer titles. In every engagement with my clients, I always conduct telephone interviews with several of their customers from each group as a core component of value proposition research. I’ve included a list of the questions I use with each specific group -- feel free to use them yourself!
Client Interview Questions
For NEW clients:
For CURRENT HAPPY clients:
For FORMER clients:
So, to recap, we have internal interviews, external testimonials, customer questions, and a competitive messaging scan. This gives us a great deal of solid information for us to use as we are starting out to build our value proposition. It’s not everything that we need, but it’s a lot! The final type of external research that you should have is plain old market research on your target market(s). If you haven’t updated that recently, now’s a good time to do so.
Overall, when it comes to building a buyer-focused value proposition, I strongly believe you should never start with a blank piece of paper. If you do, you will end up with only an “inside-out” value proposition which has a very low likelihood of resonating with an “outside” prospect. Instead, start with everything you know about what’s already in the buyer’s mind. Speak their language. Address their concerns.
I have more to share! Take a look at my Value Prop Masterclass BrightTALK session: The Anatomy of a Buyer-Focused Value Proposition. I think you'll find some great info to help you refine your approach. Want to talk it through with me? Contact me at Ldennis@knowledgence.com.
Most of us experience a value prop as essentially a tag line or an elevator pitch. Short, sweet, to the point. Because that is our daily experience as buyers, the assumption is that this IS what a value prop should look like. The challenge is that it’s really, really hard to create content and sales conversations when the source material is only 3 or 4 words long or just a single sentence. A tag line and an elevator pitch are just a distillation of the overall message. There is a large amount of information involved in creating a complete value prop. To capture and organize this information, I created the Value Proposition Platform™, a two-page summary of all the key elements needed to fully develop and enable a strong and consistent message. It serves as both a blueprint and a framework for successful interactions with prospective buyers.
How Many Value Props Do I need?
Typically, businesses require a main value proposition, focused on a flagship product or service offering with a primary target audience. But there is a very good chance that we may also need to fine-tune that message for other targets, and for different industries as well. The business issues could be different; the language or market imperatives could be different. Therefore, we need to be prepared to take our “foundational” value proposition and create additional versions as needed. We don’t want (or need) to recreate the wheel each time. We’ll produce a similar format for each version that we need. The Value Proposition Platform helps keep us on point and organizes our approach to interaction – verbally, digitally, and in print – with prospects.
There are three sections to the Value Proposition Platform. The first section defines your target, the second articulates your value proposition statement, and the third shows quantification of your claims with documented proof. Each of these sections have important, well-defined sub-sections. It is this type of organization that gives your value proposition its strength.
Section 1: Defining Your Target
The first section begins with a focus on the business SECTOR at which we are aiming, and it identifies our prospect’s primary industry and industry segments for the value proposition.
If you have product or service offerings aimed at additional industries, it is imperative to create additional versions of the Value Proposition Platform to ensure that your messaging is still industry- and segment-relevant. But by being that specific, you are demonstrating your company’s knowledge of the industry that the prospect is in. This is the first step in engagement – by demonstrating that you know and understand their markets.
The next part is focused on the TARGETS at which we are aiming, identified by the titles of key decision makers as well as those who typically influence their decisions at companies in these industry segments. For example, at the top of any such list will be the person “in charge,” be it the CEO or the business owner. Then, there are the VPs & Directors of the departments that your product or service impacts. The influencers? Certainly, the head of Finance will want to weigh in on any significant purchase. IT managers and production managers may also be involved, whether overtly or covertly. It is important to understand that your value proposition is just not aimed at the person who signs the contract. You are communicating with a team of people. This means that you will need to potentially tweak your value prop when you are aiming at widely different targets. Think CMO and CFO as an example.
The next piece identifies key BUSINESS ISSUES that we know are significant to the decision-makers and influencers, and that are also relevant to our offering. All business issues must be discussed from the point of view of the target audience. This section is not about the issues that our product or service solves. An outside-in perspective is needed here – outside of our company, from inside of their world, and in their language. These issues can be as basic as “Our sales results aren’t good enough” or as complex as “We lack a standardized and automated process to collect mentions in media – we currently use multiple systems and individual research.” The point is, you have to know exactly what hurts in order to address their pain.
Combined, the Sector, Targets, and Business Issues help us identify the value proposition audience. To achieve true relevance, we must be crystal clear in this section, and we must learn the nature of the issues, goals, or problems this audience seeks to solve.
Section 2: Value Proposition Statement
Now we get to the Value Proposition Statement itself. This section is also in three parts.
First is THE BUYER OBJECTIVE. This is a statement (in the words of the buyers) about something that they hope to accomplish, or are struggling with, or need to address in their own business. First brainstorm the needs, issues, challenges and problems they face. Keep in mind that this has to be from their point of view. Beware of trying to solve those problems by listing them as things “they need to do.” This must be completely from the buyer’s viewpoint, in the buyer’s language. This statement is entirely about them.
But the next section is our turn! Time to articulate THE COMPANY OFFER, a clear and concise statement of our product / service that specifically addresses the Buyer Objective statement. The offer is a response to the needs stated in the Buyer Objective statement. This is our first opportunity to connect the buyer’s needs to our offer. It is also very important that our offer is communicated in their language, rather than using internal company-speak.
The “kicker” to your offer should be THE DIFFERENTIATOR, at least one provable point of differentiation from your key competitors that is both relevant and important to your buyers’ objectives. At the same time, keep in mind that more differentiators do not automatically equate to greater value. Quality over quantity; relevance and proof are critical to this section.
Identify Value Drivers
The final segment of the platform lists three – five primary Value Drivers, conceptual points that are typically top-of-mind for the buyers which drive them to action. Every potential buyer has some drivers that will guide their purchasing behavior. We’re talking about very basic concepts that typically become very important issues to business leaders. Some examples are:
Rest assured, there will also be other value drivers that are directly related and highly specific to their business needs that you may not have yet discovered. One or more of these drivers will most likely affect the target’s thinking about what they need to accomplish, and how they are going to get there. Always be on the lookout for the ones that make your buyers tick. Using this information wisely allows us to get directly to the heart of a reason to buy. It also demonstrates that we “get it,” in terms of the buyers’ needs, which gives us credibility. These drivers allow us to extend, validate and demonstrate our differentiation.
As we build our offer around these value drivers, we need to provide Quantification of our claims. Buyers will pay attention and respond when there is clear and objective back-up to our claims. No vague or nebulous terms here! None of this “We’ll save you money!” crap... No, if you want to make a claim, back it up. How about “We’ll save you 25% over the first 12 months.” Formulate a way to truthfully quantify the impact that the prospect can expect after signing up with your company. If you can’t quantify it, then the claim is generic and not impactful enough for a buyer to consider.
And most importantly, show some Proof. Without proof, your claims are empty. Phrases like “We’re the only one in the market” ring kind of hollow unless you can point to some reputable testimonials, expert sources, and other credible and objective third-party validation. Industry awards, positive media recognition, sponsorships, that kind of thing. This is not a place to be blowing your own horn; you want other people blowing their horns for you.
Perhaps one of the reasons that buyers have commandeered the sales process over the past several years is that they have not been able to rely on vendors to deliver relevance across the range of information that they provide. It all starts with the Value Proposition Platform, which gives the first real indicator of whether we are tuned in and communicating in a way that resonates with the buyers’ reality. Given that most companies’ value propositions have inherent weaknesses, you can clearly shine a light on differentiation by crafting your value proposition using this organized, buyer-centric platform approach.
You want to know more about it? Reach out! I’d love to talk!
Throughout my career in marketing and sales, I have spent considerable time trying to craft messaging that would appeal to targeted audiences, both internal and external. And I’ve got to admit, it is not always easy to make some of this stuff interesting! In fact, I often read some old value props when insomnia hits – works like a charm.
Unfortunately, they were not written to put people to sleep. So how DO you tune your message for buyers so they don’t just yawn? The first step is understanding what buyers are seeking in marketing and sales messaging – and to understand what the real impact is on their decision making when they are faced with a value proposition that is average.
To begin with, there is typically a mixed understanding between marketing and sales of what the term “value proposition” truly means. This is our first hurdle: how do we get a clear and consistent message out there if sales people are saying this, marketing is saying that, and senior staff and subject matter experts are saying something else?
First Do a Reality Check on your Message
When I kick-off a messaging project, I ask everybody involved to write on a piece of paper their version of the organization’s value prop. Then we share everyone’s answers. It is almost always an eye-opener to hear what comes back! Some of it isn’t even recognizable as representative of the core offering. Most of it ends up being about the features of the offering – presented as if they were benefits, in and of themselves. That, my friends, is the standard for value propositions today. And the sad truth is that this “standard” makes your buyers YAWN. It’s only been done by every business for the last forever. I think it is way past time for a better approach!
If the standard doesn’t work anymore, how do we go about finding the right value proposition message? As marketers, our focus is often centered on the product or service first, and then on the buyer. I mean, the company that provides the product or service is the one that pays our salary, right?
The thing is, nowadays, buyers don’t want to hear so much about features/benefits – they know that stuff already! They have already looked at your website, downloaded your product sheets, talked to their peers, looked at industry information. When they are ready to talk to you, they want to talk about VALUE – how is your offer, with all the afore-mentioned features/benefits, going to deliver value to their business? And exactly what is the nature of that value.
Because buyers are human, they care much more about themselves and their concerns than they do about you and all the features of your product or service. So, unsurprisingly, a parade of features and benefits is going to induce yawns from your prospects and doodles on their notepads. Now you, as a marketer, have a decision to make in terms of whether your value proposition is going to be all about the product/service, or all about the buyer. Hint: this really should not be a tough decision.
Do Value Props Still Matter to Buyers?
Not long ago my company, Knowledgence Associates, did some research in partnership with IDG Connect (the demand generation division of International Data Group, the world’s largest technology media company) which focused on how buyers view and use value propositions in their buying process. We surveyed 300 buying team members involved in technology/service-related purchase decisions, out of which 78% of the survey respondents were decision makers. (You can see highlights of the research by downloading the infographic here.) Their responses demonstrate a palpable disconnect between what is frequently delivered in value propositions and what informed buyers need to see.
Here is one specific point that jumps out– most value propositions invoke indifference because they don’t focus on what the buyer is focused on. Most value props are geared to sell what the seller wants to sell, not what the buyer wants to buy. Let’s examine that strategy a bit.
Regarding specific vendor offers that they were considering, buyers were asked to assess the lowest and the highest value proposition relevance they encountered. The results were eye-opening! The highest level of relevance was a mere 71%, while the lowest was 30%. Wow. Think about this. We, as marketers, are putting buyers to sleep with cookie-cutter val props!
But chew on this…If the best thing that’s out there is only 71% pertinent to an interested buyer, then there is a golden opportunity to stand out for anybody whose value proposition hits above and beyond that average level of relevance! To underscore that point, a full 85% of the respondents said that those vendors offering the most relevant value propositions become their favorites during the purchase decision process. This is proof of the importance of knowing your target’s business and challenges before trying to sell them something.
Shifting Message Focus is Step One
You want to get on the buyer’s short list? Focus first on relevance! You want to put the buyer to sleep? Then continue to prattle on about your features and benefits. Of course your product or service itself is important. But what you say about it, and how and when you say it to the buyer, is crucial. From the get-go, you need to shift your focus from your product to the buyer. It means clearly presenting value in their terms first, before describing details of your offering. Relevance is the jolt of caffeine that makes the most bored buyers snap to attention!
While this may sound obvious, I can tell you from first hand experience that is hard because by definition our focus as marketers and seller is on our offering. Making the switch is not easy.
Wondering how to flip that switch?
Book a short call with me and I will share some ideas to help you get started. My calendar is here, and there is no obligation at all. I’d love to see your value proposition and chat about it – it’s all part of my mission to help marketers and sellers speak more impactfully to their buyers. Hope to hear from you!