What is a Value Proposition?

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A value proposition is a promise that a company makes to its customers to convince them to choose that company’s product over another.

🤔 Understanding a value proposition

These days, consumers have plenty of different choices when making their purchases. As a result, companies have to find ways to differentiate themselves from their competitors and stand out from the crowd. The value proposition is one way that companies do that. A company’s value proposition is the promise to customers to deliver value. More importantly, the value proposition shows how that company has more value to offer than its competitors, with the value being the worth to the customer, separate from the cost of the product. Effective value propositions emphasize the benefit that consumers will get from a particular product. A value proposition often includes a headline or tagline that draws the customer in and more information explaining the benefits of the product.


Companies don’t just list their products for sale and hope that consumers buy them. Instead, they use value propositions to show consumers why they should buy their products. If you visit Apple’s website, you wouldn’t just find a “buy now” button to get the latest iPhone. Instead, you’ll find a value proposition. First, the company has a short and simple headline to draw you in. Next, Apple has a short paragraph highlighting why you should buy the smartphone. Scroll down a bit further and Apple shares some of the key benefits of the phone, along with visual examples. Apple’s goal with their sales page isn’t just to get you to click the buy button as quickly as possible — The company first provides evidence as to how its phone gives more value than its competitors.


A value proposition is like an elevator pitch…

The concept of an elevator pitch is that you should be able to tell someone about your product, your company, or yourself in the time of an elevator ride. It's your short and snappy introduction that you can give in less than a minute, but that still gives the listener the whole picture. A value proposition is similar, except instead of being a pitch you make in a short elevator ride, it’s the pitch you give to someone when they land on your website or see your ad. It has to be quick and to the point before the other person gets off on their floor, metaphorically speaking.

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What is a value proposition?

A value proposition is a statement companies use to position themselves in the market and communicate to potential customers what value they’ll get from a particular company or product. A value proposition includes a headline to pull in the consumer. After that you’ll find additional paragraphs or bullet points sharing the key benefits of the product, often with visual representations.

Value propositions are usually quick and to the point. The purpose of this positioning statement is to immediately attract your target customer (while leaving out those who are definitely not in your target audience).

Have you ever hopped onto a company’s website and just instantly felt a connection, as if whoever wrote the copy was speaking directly to you? If so, then it’s probably the case that the company had a carefully written value proposition with individuals of your exact demographic in mind. The company was able to quickly convey to you that its product was right for you and that you would receive a benefit.

How does a value proposition work?

A value proposition is like an elevator pitch that customers read on your website, social media pages, or marketing materials. It’s a way to quickly differentiate a company or product from its competitors and tell customers exactly what benefits they can expect.

One of the primary goals of a value proposition is for a company to differentiate itself from its competitors. For an example of when this is important, think back to a time where you were shopping around for a particular good or service. Perhaps you were shopping for a car loan or a photographer for your wedding. When you’re spending that kind of money, you’re probably going to check out several companies before committing to one.

While you’re shopping, you’re going from one company’s website to the next, noting which ones stand out to you. Each company has written its value proposition statement in a way it hopes will make you choose it over its competitors. The company shares its unique selling point, which could be a lower interest rate or more hours of photography on your wedding day. Regardless of the type of product or service you were shopping for, the company’s value proposition may have been what helped you make your final decision.

What are the components of a value proposition?

A strong value proposition addresses three primary elements. The first piece that your value proposition should include is the customers you’re going to serve. This element is critical because it helps to make sure you’re positioning your company in a way that attracts those people. If you write your value proposition well, people will be able to read it and know right away whether your product is for them.

Consider the meal delivery company Purple Carrot. The company addresses the question right away of who its product is for by including the phrase “plant-based” in its value proposition. Those who eat a plant-based diet will immediately be interested, while those uninterested in a plant-based diet will most likely exit the website.

The next thing a value proposition should include is the benefit your company or product gives to your customers. This part of the proposition directly addresses the needs and pain points you meet for your ideal customer. For example, take a look at the budgeting app You Need a Budget. At the very top of its homepage, the company says that it helps people to stop living paycheck to paycheck, pay off their debt, and save money. Scroll down a bit further and the company gets even more specific, claiming that most users save $600 in the first couple of months with the app, and $6,000 or more in the first 12 months. The company is very upfront about the exact benefits it provides.

The final piece of the value proposition is the price point at which people can buy the product. The value proposition doesn’t necessarily include the exact price that you charge, but rather what sort of value people can expect to get for the price. Some companies will emphasize their low prices. Walmart, for example, includes “everyday low pricing” in its value proposition. Other companies might sell themselves as luxury products, which indicates a higher price point. Indicating the price point can help brands attract the right people and repel those who don’t fit their target market.

What are some of the best value propositions?

The purpose of a value proposition is to position your company in the market and attract the right people (while simultaneously repelling the wrong people). There are several angles that a company might choose to take when writing its value proposition.

  1. Best quality on the market: Some companies pride themselves on selling genuinely high-quality products. And those companies are sure to emphasize that quality in their value propositions. The outdoor brand Osprey is so confident in the quality of its products that part of the company’s value proposition promises free repairs on its products whether it’s been one month or one decade since you bought them.
  2. Best value for the price: Some companies position themselves not necessarily by having the best quality product, but by offering the best quality for the money. Consider furniture brands, for example. While some furniture brands might have a value proposition that boasts the best quality, IKEA’s website first emphasizes the low price point.
  3. Aspirational: There are some companies that use their value proposition not to convince consumers that their products are the best value or the best quality, but that they provide luxury and something to which to aspire. Tiffany & Co. is an example of such a value proposition. Its website tells you that they sell luxury jewelry, not that you’re getting a lot of bang for your buck.
  4. A must-have: Companies can use their value propositions to position themselves in a way that makes people feel like they just have to have their product. An example of a company with this type of positioning is Apple. For many people, Apple’s products are a must-have. Aside from the brand reputation that Apple has, the company makes its products even more desirable with the pairing features it offers between products in the Apple ecosystem.
  5. Different from the rest: Plenty of companies have made a name for themselves by differentiating themselves from their competitors in a big way, creating a competitive advantage. These companies disrupt the market, doing things differently than the way people have always done them. A great example of a company with this type of value proposition is Uber, which entered the transportation industry by making itself entirely different from traditional taxi companies.

How do you write a value proposition?

To start writing your first value proposition, try to answer the following questions about your company or your product:

  • What are your company’s core values and mission? Consumers are attracted to brands that share their values.
  • Who are the customers that can benefit from your product? Consumers want to look at a product and immediately relate to the marketing. Being specific in your value proposition can help you to achieve that.
  • What benefits does your product give and how does it create value for your customer? Show your consumers exactly what they get out of the purchase.
  • How are you different from your competitors? Your value proposition should clearly show consumers why it’s better to buy from you than a competitor.

Once you’ve compiled all the information you need to write your value proposition, it’s time to put it all together. Make sure your proposition is quick and to the point. Remember, it should be like an elevator pitch that you can quickly relay. Be sure your value proposition tells a reader exactly what benefits they get from you and how those benefits are better than what your competition has to offer. Visual elements are also beneficial — They can help to draw the consumer in or show them how your product works.

What are some examples of value propositions?

The value proposition is standard practice in the marketing world, and something companies put a lot of work into. Here are a few value proposition examples that quickly tell customers what they get from the product.

  • Mint: The budgeting app Mint delivers a short and compelling value proposition on its website. The company immediately tells you what it does (it helps you to manage your finances), followed by more detailed information about the benefits it provides. It provides visual aids by sharing screenshots of certain parts of the app.
  • Slack: Slack is a company that helps remote workplaces communicate with each other. The very first phrase on the top of the website — work from home — tells customers exactly what the company helps people to do. Then it dives into a bit more detail about how it helps you do that.
  • TOMS: Some companies provide value in a way that has nothing to do with their products. The shoe company TOMS is a perfect example of such a company. Rather than using their value proposition to promote the value of their product, TOMS talks about how it gives part of its profits to charity. This value proposition will be attractive for customers who place a lot of value on corporate social responsibility.
  • Casper: Casper is a company whose value proposition included disrupting an existing market. Rather than operating in the way that traditional mattress companies do, where you visit a mattress store, Casper sells itself by sending the mattress in a box directly to your door. It isn’t just the convenience factor that Casper includes in its value proposition — It also emphasizes the science behind its product.
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