Unique Value Proposition

Unique value propositions aren’t too unique to the marketplace, but they can provide you great value.

 

In 1988, Michael Lanning and Edward Michaels of McKinsey & Company developed the concept of the value proposition.  Building on the concept of the unique sales proposition, they wrote in their paper, “A business is a value delivery system,” emphasizing the “importance of a clear, well-articulated “value proposition” for each targeted market segment—that is, a simple statement of the benefits that the company intends to provide to each segment, along with the approximate price the company will charge each segment for those benefits.”

Maybe that verbiage sounds too technical, but the concepts are important.  In simple terms, it’s important to clearly and effectively communicate the benefits a business provides to its customers.  

The question for you is this: are you effectively presenting the total benefits you offer to your customers as a unique value proposition?  And, more importantly, what is their reaction to your presentation? 

In a noisy marketplace, a unique, valuable and clear presentation needs to be the main objective.  Otherwise, you blend into the noise to the point that someone has to find you.  It’s like going to a busy outdoor market with hundreds and hundreds of booths.  Unless your booth is at the entrance, and it has an attractive storefront, it’s going to be hard for customers to find you.  The further back you are in the marketplace, the harder it is to find you.  And if you are in a very busy marketplace, it means that customers will intentionally need to seek you out – or you simply don’t get a significant amount of business.

That’s why it’s important to create a unique and effective plan to gain the attention and loyalty of your customers.  Using the same outdoor market analogy, you find what it is that will get customers to come to your booth.  Obviously you want to sell what people are looking for, so that’s the first step.  But you might use bright lights, play music, get a banner that is higher than everyone else’s banner, or do provocative things to get people’s attention. 

I remember going to a swap meet as a college student.  We were looking for some household pots and pans when we came up to a booth that was managed by a guy with a bright Hawaiian shirt.  He was holding this odd device with surgical tubing and a canvas pocket with a handle in the middle of the tubing arrangement.  Before my friends and I could get a chance to walk away, he put one end of the tubing in my hand, then put the other end in my friend’s hand, and then instructed us to “stand strong.”  The next thing I knew, he put a water balloon in the canvas pocket, told us to raise our arms to the sky, and then proceeded to pull on the tubing as he sat on the ground.  

Before I knew it, he pulled that canvas pocket to the ground and let it go.  The water balloon inside the pocket went sailing into the sky, over the major street that bordered the swap meet, and then it collided with a junkyard car in the salvage yard across the street.  With this device, he was able to launch that water balloon about 250 yards – which was something we had never seen before.  This whole demonstration took about 20 seconds, with half of the time watching the balloon sail over 2 1/2 football fields.  

As a college student who liked to have some fun, this was an incredible demonstration.  Not only was I totally amazed, I was wanting more of this kind of fun.  For years, I was only able to throw balloons at a maximum distance of 50 yards, and most people could see them coming before they showed up.  This guy showed me that, not only was this device a powerful one, but it was really sneaky, too.  All that salvage yard owner knew was that someone either had a rocket arm or that someone had a device that was really powerful.  Either way, the yard owner was getting mad because he was being attacked by water balloons that were bringing a whole lot of velocity and no noise.   

Giving him the $20 in my pocket was a great exchange for the fun I knew I was going to have with this water balloon launcher.  I could already see the benefits I was gaining already with this new device.  To make the deal even sweeter, the sales guy threw in a package of water balloons for free.  All I needed was a faucet, two other friends and a target, and the fun would soon begin.

As it turned out, the water balloon launcher was everything the sales guy promised, and a bit more.  My friends and I had a great time with that launcher for years.  When my kids were old enough, they used it as well until the surgical tubing finally dried up and became brittle.  I should have worked out a referral program with the sales guy, simply because everyone wanted a water balloon launcher like mine.  I sent them to the swap meet, telling them to look for the Hawaiian shirt and a clear aerial path to the salvage yard across the street. 

So why did that sale work so well for all of the parties concerned?

First, the sales guy knew his target customer: a single male, most likely either a high school or college student.  When he saw his target customer, he knew that he had to make a visual and kinetic demonstration of the product.  Talking about it wouldn’t be nearly as effective as executing the process.  Then he put the product into our hands and inserted us into the successful event.  He went so fast with the “setup” that we didn’t have time to think of a suitable rejection of his offer, which was also brilliant.  Once the balloon was in the air, he now had a completely captive audience, because the customer would have to see what happened.  When it hit the junkyard car and made a loud boom – which probably put another dent into the car – we were now a major part of the fun.  

No other booth at the swap meet at the time was going to put you into a situation where you were inserted into the fun like that, with no cost to you.  Lots of “male-bonding” experiences could be yours, along with the great stories that would be connected with them.  The natural reaction was immediately talking about the potential of this device, along with the plans for some great adventures.  

I don’t know if the sales guy was a marketing major, but he presented a great unique value proposition – one over 30 years ago and will be remembered for the rest of my life.

What about you? Is there anything that you can provide your target customer that will engage him or her to the point that they get excited about the products and services you offer?  Can you create an environment where they can fully experience what you have to offer, along with the successful and beneficial results?  Better yet, do you have an environment where they can test the products and/or services in a risk-free opportunity?  Most importantly, are you showing a value that is perceived to be greater than the price that is being offered?  

Make a commitment to build, clarify and passionately promote the products and services you offer with a compelling unique value proposition.  Just like the water balloon launcher opportunity, make it so effective that your customers will never forget the presentation and the value they gain from your business or organization.