Why Should a Customer Buy from You? Improving your Value Proposition


Marketers are increasingly being challenged to differentiate, support and communicate their product or company’s value proposition versus the competition.  This problem is even more acute in industries like health care, commodities and services that do not sell packaged, branded products.  The fact is, most company’s position and promote the same things.  For example, how many times have you heard firms in your industry advertise that they have the best price, performance or service, and yet provide little support to back it up?

Truth be told, firms that can not demonstrate and communicate compelling and relevant differentiation will have an extremely difficult time gaining market share over the long term, without significant price discounting, corporate acquisitions or competitive missteps.  A significant body of research confirms that a lack of differentiation is inevitably linked to lower pricing levels and margins.

How do companies end up misreading and misrepresenting their value proposition?  For one thing, there are significant human and organizational barriers to seeing the problem, including:  executive-inspired groupthink, limited customer contact, and a lack of critical information around product performance, competition etc.  Moreover, questioning the value proposition often becomes a “third rail” issue because it gets to the core of what a company is and what it’s employees do day-to-day. 

For firms to flourish, they need to regularly understand their competitive position.  To do this, they first establish whether there is a problem.  Here is how I help determine that:

I often play a little trick on the senior leadership team, including the CEO and marketing head.    Before meeting, I briefly scan what key competitors are doing and saying.  Then, I quickly review what the client’s value proposition is and how it is being communicated.  Then, I gather together senior executives from across the organization and ask them to privately write down the 3 reasons why customers should do business with them, as compared to key competitors.  For the last step, I share the answers with the group.  To their surprise (but not mine), the responses usually encapsulate different clichés like service, responsiveness or performance – similar to what is being said by competitors.  The point is simple:  if companies don’t understand if and why their value proposition resonate, neither will customers or channel partners.

Much of the problem lies in the haphazard way marketers develop and message their value propositions.   One “best in class” approach is to conduct a yearly and systematic review of your competitive position by category, including: 

  1. Understanding the customer’s key functional and emotional needs;
  2. Analyzing the true advantage or benefit that your product delivers;
  3. Confirming the “reason why” or proof for this benefit;
  4. Identifying whether you consistently deliver on your value proposition;
  5. Reviewing whether your value proposition is communicated in a meaningful fashion. 

Most firms have value propositions.  The very successful ones make them relevant, credible and different.

For more information on our service or work, please visit www.quantaconsulting.com

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11 comments so far

  1. Kyle McGuffin on

    Great article Mitch. It blows me away how many times I here me too value propositions. Especially in Telecom. I remember talking to a senior executive and when I asked the question why his company he said it was like a gourmet meal. His company took the time to make the meal exactly like his customer wants it by completely understanding their needs. I can assure you this company is not #1. As he finished his sentence I look into his eyes and he knew that this was not a strong statement. Now with social media companies should reflect on what differentiates them from the world and if they can’t find anything realize they must or they will be out business. We are just at the beginning of true globalization and with the power of the web and our knowledge in communities we can make an immediate impact. Thanks again for some great comments.

    • mitchellosak on

      Thanks for the comments Kyle. Your anecdote reinforces what I have witnessed over the past 20 years.

  2. Franchise Business on

    Very good post, Its true that customers are the life line of any business and until and unless you present your business in an attractive way the targeted customers will not buy your product or services.

  3. stock tips on

    I appreciate your post. I also wrote that SMS advertising provides a cost effective method of targeting promotions to specific customer profiles. You might want to remind customers of specific events or promotions, but for whatever reasons, SMS allows you to pass information directly to the right customer at very affordable prices and fast delivery.
    Stock Tips

  4. […] In our research, sales outcomes improve for a variety of reasons: 1)  a company or sales rep can more easily differentiate themselves, particularly in highly transactional or commodity markets;  2) delivering value […]

  5. […] In our research, sales outcomes improve for a variety of reasons: 1)  a company or sales rep can more easily differentiate themselves, particularly in highly transactional or commodity markets;  2) delivering value […]

  6. […] natural for strategy to fall out of a focus on the customer, with lots of attention paid to the value proposition and branding. Giving short shrift to other vital areas of the business – supply chain, HR and […]

  7. […] More positively, some forward-thinking managers recognize that they can increase revenues and improve their value proposition by collaborating with their customers to retool their pricing policies and […]

  8. […] More positively, some forward-thinking managers recognize that they can increase revenues and improve their value proposition by collaborating with their customers to retool their pricing policies and […]

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  10. […] will have to figure out how to create and maintain winning sales relationships using persuasion, compelling messages and 1:1 enabling […]


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