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Value Proposition

Definition

A value proposition is a promise of value to be delivered, communicated, and acknowledged. It is also a belief from the customer about how value will be delivered, experienced and acquired.

What is a 'Value Proposition'

A value proposition is a business or marketing statement that a company uses to summarize why a consumer should buy a product or use a service. This statement convinces a potential consumer that one particular product or service will add more value or better solve a problem than other similar offerings. Companies use this statement to target customers who will benefit most from using the company's products, and this helps maintain an economic moat.

Explaining 'Value Proposition'

A value proposition is a promise by a company to a customer or consumer segment. It is an easy-to-understand reason why a customer should purchase a product or service from that specific business. A value proposition should be a clear statement that explains how a product solves a pain point, communicates the specifics of its added benefit, and states the reason why it's better than similar products on the market. The ideal value proposition is concise, and it appeals to a customer's strongest decision-making drivers.

Creating a Successful Value Proposition

A company's value proposition communicates the number one reason why a product or service is best suited for a customer segment. Therefore, it should always be displayed prominently on a company's website and in other consumer touch points. It also must be intuitive, so that a customer can read or hear the value proposition and understand the delivered value without further explanation.


Further Reading


The blended value proposition: Integrating social and financial returns
journals.sagepub.com [PDF]
… set of financial ratios simply tell a story; they give testimony to our values and priorities … They cannot be separated and considered as distinct propositions, but are one and the … Tracking a Blended Value Proposition requires creation of a Social Man- agement Information System …

The co-creative practice of forming a value propositionThe co-creative practice of forming a value proposition
www.tandfonline.com [PDF]
… set of financial ratios simply tell a story; they give testimony to our values and priorities … They cannot be separated and considered as distinct propositions, but are one and the … Tracking a Blended Value Proposition requires creation of a Social Man- agement Information System …

The critical role of information sharing to the value proposition of a food systems networkThe critical role of information sharing to the value proposition of a food systems network
www.tandfonline.com [PDF]
… set of financial ratios simply tell a story; they give testimony to our values and priorities … They cannot be separated and considered as distinct propositions, but are one and the … Tracking a Blended Value Proposition requires creation of a Social Man- agement Information System …

Value proposition for digital technology innovations of uncertain market potentialValue proposition for digital technology innovations of uncertain market potential
aisel.aisnet.org [PDF]
… set of financial ratios simply tell a story; they give testimony to our values and priorities … They cannot be separated and considered as distinct propositions, but are one and the … Tracking a Blended Value Proposition requires creation of a Social Man- agement Information System …

The HR value proposition model in the Arab Middle East: identifying the contours of an Arab Middle Eastern HR modelThe HR value proposition model in the Arab Middle East: identifying the contours of an Arab Middle Eastern HR model
www.tandfonline.com [PDF]
… set of financial ratios simply tell a story; they give testimony to our values and priorities … They cannot be separated and considered as distinct propositions, but are one and the … Tracking a Blended Value Proposition requires creation of a Social Man- agement Information System …

Customer value proposition, corporate transformation and growth in Caribbean financial firmsCustomer value proposition, corporate transformation and growth in Caribbean financial firms
www.emerald.com [PDF]
… set of financial ratios simply tell a story; they give testimony to our values and priorities … They cannot be separated and considered as distinct propositions, but are one and the … Tracking a Blended Value Proposition requires creation of a Social Man- agement Information System …

Value proposition as a framework for value cocreation in crowdfunding ecosystemsValue proposition as a framework for value cocreation in crowdfunding ecosystems
journals.sagepub.com [PDF]
… set of financial ratios simply tell a story; they give testimony to our values and priorities … They cannot be separated and considered as distinct propositions, but are one and the … Tracking a Blended Value Proposition requires creation of a Social Man- agement Information System …

Creating a Balanced Value Proposition–Exploring the Advanced Business Creation ModelCreating a Balanced Value Proposition–Exploring the Advanced Business Creation Model
repositorio.ismai.pt [PDF]
… set of financial ratios simply tell a story; they give testimony to our values and priorities … They cannot be separated and considered as distinct propositions, but are one and the … Tracking a Blended Value Proposition requires creation of a Social Man- agement Information System …



Q&A About Value Proposition


How can you differentiate your product from competitors using this strategy?

By creating an effective statement that differentiates your product from competitors, you can increase market share.

What will help build sales faster and more profitably?

A strong customer value proposition will help build sales faster and more profitably.

What is a value proposition?

A value proposition is a business or marketing statement that a company uses to summarize why a consumer should buy a product or use a service. This statement convinces the potential consumer that one particular product or service will add more value or better solve a problem than other similar offerings. Companies use this statement to target customers who will benefit most from using the company's products, and this helps maintain an economic moat.

Why should you use a customer value proposition?

You should use a customer value proposition to gain attention and approval from your target market.

Why do companies need to make their value propositions intuitive?

Customers should be able to read or hear the value proposition and understand the delivered value without further explanation.

What does it mean when you say that companies use their value propositions to target consumers?

Companies use their value propositions to target consumers who will benefit most from using the company's products, and this helps maintain an economic moat.

What is a customer value proposition?

A customer value proposition is the sum total of benefits that a vendor promises to deliver in return for payment.

What does it mean when you say that companies must keep their value propositions concise?

The ideal value proposition is concise, and it appeals to customer’s strongest decision-making drivers.

How does a customer value proposition differ from other propositions such as marketing or business propositions?

Customer value propositions are targeted towards potential customers rather than other constituent groups such as employees, partners or suppliers.