What’s a value proposition all about?

The value proposition is a powerful statement that (preferably) captures the mind and the heart, and reveals a unique, highly relevant advantage or appeal. It is usually expressed as a tagline and a clear set of statements that form a platform for communicating a company or product brand.

A value proposition can be thought of as a distinctive position in the “mind’s eye” of the customer, based on perceived emotional and functional benefits. It is often a promise of customer experience. It’s a single idea you own that makes someone more likely to choose you. It’s the essence of the brand’s benefits – functional and emotional – that current and potential customers should expect to receive when experiencing a brand’s products and services.

A value proposition is most akin to a positioning statement. Personally, I prefer to use the words “value proposition” instead of “positioning statement”, since it focuses attention on the number one need – establishing value. After all, what’s the point in blowing big media budgets on promoting something that, even if it manages to capture your target audience’s attention (the ad campaign won a prize regardless of whether the product sold), people don’t feel there’s enough value to bother trying the product or calling you for a meeting?

In search of meaning
There are plenty of ad agencies out there that create pretty meaningless statements about their companies and/or their products. Stuff like: “The preferred professional partner” or “We do it a little bit better”, or “the leading provider of xxxx”. Statements like these are, quite frankly, useless.

A true value proposition can take many forms. For example:
- We’re No.2 – we try harder (reason to prefer: “I appreciate the values of modesty and a will to make things better, and I expect that a company that makes such a honest statement really does go the extra mile”).
- Design for the people (reason to prefer: “I want designer furniture, but I can’t afford top-end brands – here’s a company that appreciates my position”).
- A thousand shades better (reason to prefer: “This hearing aid delivers the best possible sound quality, which I understand is the most important single factor when choosing a hearing aid”).

You can arrive at your value proposition by considering:
- What functional benefits might our customers want from a company like ours?
- What might grab their attention?
- What might appeal to their hearts? Capture their imaginations?

In a world where people are disinclined to give you even a split second of their attention, nailing the value proposition means identifying one key message you can say about your offering that will make people want to know more. Then you need to support it with no more than three sub-messages that make the main message even more compelling.

For example (for a new hearing aid):

Main message:
“The No.1 choice for an active lifestyle”

Three sub-messages:
ReSound Live™ is the No.1 choice when you want to be:
- Physically active – whenever you need to move your body
- Socially active – whenever you’re together with friends or family
- Mentally active – when you want to be at your focused best

Okay – I just bought a new frying pan. The brand itself, though well-known, didn’t mean much to me, but I liked the look and feel of the product. The entertainment started when I got it home, however, and read the little brochure that came with it.

But first, a little backgrounder. There’s an ad agency in Copenhagen which is known for its very simple formula, consisting of two basic words: “freedom” and “sense”. For a long list of clients, the agency has come up with the slightly altered versions of the same idea. It goes kind of like this:

“Free yourself”
“Free your senses”
“Sense your freedom”
“Free your creativity”
“Sense your creativity”
“Sense your delight”
“Delight your senses – for free”

I could go on with this mindless drivel, but you get the idea. It seems that, by seeking the deeper meaning in things as elementary as a frying pan or an ironing board, and presenting this to the advertiser in beautiful images and words like “freedom” and “sense”, the poor client can’t help but fall in love with this stunning new angle to what they had previously (and rightly) considered quite everyday. The result is text like that appearing in the frying pan brochure:

“Sense…Combination, Material, Form. We receive the information that enables us to make choices through our senses. When we cook we use all our senses – we taste, we use our sense of smell, we feel, hear and see – and we choose our utensils. The choice of utensils is part of the experience of cooking and serving food. Chosen with common sense and a reliance on our senses, this can become a great experience.”

Who orders text like this to be written – who approves it? Only people who can’t see past their own ego. Now, I am just guessing that this text was written while the fyring pan manufacturer was a client of the aforementioned agency.

Here’s another of their gems:

I can’t remember the exact wording, unfortunately, but the company was a famous Danish household hardware manufacturer. The product was an ironing board. A lavish two-page, full-color ad in a leading lifestyle magazine showed the ironing board suspended across a deep abyss. The basic idea read something like: “An ironing board is a bridge between your shirts and your personality”. It then raved on about personal style, taste, whatever. People, it’s a friggin’ ironing board. Get a grip. If anyone’s interested, I’ll go back and try to find that ad, because it’s a legend, at least in my own mind.

Luckily, it seems the hardware manufacturer has recovered from its senseless drift into La La Land. And they no longer appear on the agency’s client list. Today, they focus on, and strongly communicate, a single and very clear positioning: developing “solid household products that retain their beauty and performance for up to 20 years”. This simple statement has become the central thread for almost everything they communicate. And that’s a fantastic example for many other advertisers to follow.

A final example of the agency’s propensity for lavish flights of fancy: I saw a pitch the company did to a US-based company that manufactures the green foam stuff you push flower stems down into when you are arranging flowers. That’s all – just a holding device for the stems. The concept for the pitch? “Free yourself”. Apparently, this humble material made it possible for the purchaser to realize their true creative potential.

And that’s how to make a ton of money on the perpetual readiness of many advertisers to fall madly in love – with themselves.

If you’re marketing to English-speaking markets, it pays to remember that you will likely be up against some of the world’s best communicators: the sales and marketing executives recruited by native-English speaking countries. These days, a standard job description for American or British sales and marketing people almost always requests things like:

Superior verbal and written communication skills
- Theikos (USA)

Excellent verbal and written communication skills with the ability of attention to detail
- (Sprint/Nextel)

Excellent oral, written and presentation skills…
- A.M. Nielsen

Strong oral and written communication skills…
- Merck & Co. Inc.

Professional-level written and verbal communication skills…
- New-edge Networks, Inc.

Since verbal communication is the backbone of almost any persuasive task, Danish companies have their work cut out for them in oral presentations, written marketing materials and so on. Their native-English speaking counterparts simply have a natural advantage when it comes to speaking or writing persuasively.

As part of the effort to lift Danish competitiveness in the international arena, I suggest that Danish companies view the English language skills of their marketing and sales people as a competitive element that needs to be developed and improved in the same way as any other strategic asset.

A strategic asset is any asset that has strong significance for an organization’s competitive positioning, whether it be a production, financial or marketing resource. The organization should have a plan for maintaining and further developing each of its strategic assets to make sure that it performs strongly in a competitive marketplace.

In a recent exercise I took the marketing management of a major food producer through, we looked at advertisements across the food industry. We asked them to cut out ads from the industry’s trade publications and put them into three piles: the first was for companies that had no particular visual and verbal brand. The second, for companies with a visual and verbal brand that wasn’t really great. The third, for companies with high-impact visual and verbal brands. It turned out that their key competitors were in the third pile. But the company itself was in the second pile. Its managers realized that there was only one choice if they were to be seen as a market leader – they had to get into the high-impact pile. The interesting thing was that the companies picked out for this pile shared a few things – and I’d like to share those with you:

1) They didn’t use words such as ‘innovation’, ‘partner’ or ‘leading’.
2) They didn’t crowd the page with messages – instead, they were highly visual in their approach
3) They used at least a full page, often two, to get their simple, but powerful message across

The key learning is that you can write mission statements that say you lead the world. You can mention countless times how your company is the leader in your industry. But, unless you really, actually, look like a leader when you communicate, you won’t be perceived as such.

I was at a meeting the other day – a Danish-born multinational company – when there was an awkward moment of silence. It happened because the English and German country managers had asked that the brand of their company should be “less Danish”.

The Danish managers then asked what exactly that meant. The halting reply came that subsidiaries outside Denmark experienced the management style as “dusty”, “slow” and “bureaucratic”.

Interesting really, when you think about the tremendous speed of fast-developing economies such as that of China. Makes me wonder how competitive Denmark might be in the future – particularly when I also hear a comment from Grundfos’s large Chinese subsidiary say (quoted in Børsen) that, in their opinion, Chinese engineers are better than Danish engineers!