What are the business critical issues of your target market and how are you positioning your proposition as their preferred answer of choice?

Customer Value Proposition

What’s the quickest way to test whether your Customer Value Proposition is fully understood and can be articulated by your sales force? Ask any of your front-line sellers these three questions:

From your customer’s perspective…

  1. What are you selling?
  2. Why should I buy it?
  3. And why should I buy it from you?

Question 1. Should elicit a list of product features and benefits. If you get a very short list (say less than five) without the corresponding benefits, your sellers have some work to do.

Question 2. Should describe an end-state, a positive experience delivered by the benefits described as answers to the first question. Ideally it will describe a customer’s problem state that the feature/benefit provides a perfect answer to.

Question 3. is all about differentiation. Why you and not your competition? The answer to this should be framed around an evidence based descriptor of superior product performance. “Our xyz widget carries an 18 month warranty period and was award widget of the year award at the Widget of the Year Conference”. The answer to this may be based on a service component, “because 97.86% of our customers’ orders received by 3.30pm, are received by them by 10.00am the following morning”.

If you hear the answer “because we’re cheaper” as an answer to any of these, unless you actually are the absolute cheapest proposition in the market, and can confidently expect to stay there because of some unique business advantage, your sellers have some serious work to do.

The easiest money that sellers ever get to spend (your’s, or your shareholders) is the money that your sellers give away in un-required discounts.

Can your sellers put a £/$ value to each component of your value proposition? If not, then how can your customer?

“It was a difficult decision to take to get started on this. The trigger point was realising that half our business wasn’t generating any margin for us.” – CS, Chief Exec

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