“The toughest thing about the power of trust is that it’s very difficult to build and very easy to destroy. The essence of trust building is to emphasize the similarities between you and the customer.” Thomas J Watson
A customer value proposition (CVP) is a direct reflection of how your organization brings value to your target segment. It helps them answer the fundamental question “Why should I buy from you instead of your competitor?” A well developed CVP has the ability to transfer your target segment’s attention to the distinctive advantages of your product/service, and the reason they should select it. If the CVP is generic and abstract, with fancy words which do not translate into tangible value for the customer, it is of no consequence. Listed below are five steps to help you develop a winning CVP.
1. Customer Identification: Who is your target customer? Instead of answering this question with generic answers such as multinational companies, teenagers or women, be more specific in your approach. An analysis outlining the customer’s needs and their current pain points is the need of the hour. If your product/service does not fulfill a need, it will be difficult for your organization to generate substantial traction. Therefore, the first step requires understanding your target customer and ensuring that the essence of your CVP reflects an unfulfilled need. To read more about customer identification please click here.
2. Distinct Advantages: What makes your product/service special? If your product/service is homogenous in comparison to the rest, chances of getting lost in the crowd are, high. Your product/service must provide customers with a simple and clear reason to choose your organization over the competition. This being a vital component of your customer value proposition, it is essential that substantial time and effort is put into identification and development of these edges. To read more about discovering your organization’s distinct advantages please click here.
3. Measuring Value: If your product/service does not bring tangible benefit to your target customer, chances of recurring business is diminished. During customer research, you will discover pain points for your customers. These need to be addressed by adding metrics to monitor positive changes through your product/service. Once the customer understands the value you bring to their organization, they are able to select you with greater ease and provide recurring business. To read more about measuring the value brought by your product/service please click here.
4. Sustainability: With the claims made in a CVP, an organization is making a promise to its target segment. This could be in the form of creating efficiency, increasing productivity, stimulating sales or even making life easier. When the customer selects your service, they expect to receive the benefit promised to them. It is critical that organizations understand what it takes to keep those promises, and to continually make good on them. Making big claims is the easy part, delivering on those claims is what sets the winners apart. To read more about sustainability of your CVP please click here.
5. Competitor Comparison: Every company has their strengths and weaknesses. However most companies are so engrossed internally, they forget to pay attention to their competition. For a CVP to be most effective, it must clearly provide the prospect with a reason to be selected over another competing product. It must bolster its strengths and play against their competitors most exposed weaknesses. With the constant changes taking place in our world today, do not lose sight of the competition, always remain vigilant about all potential and major changes. To read more about competitor comparison and your CVP please click here.
Developing a good CVP takes time and effort. It is not something which can be done in a single day. It requires a thorough analysis of your industry, competitors and yourself. A comprehensive understanding of market dynamics and the industry’s pain points will help construct a CVP which addresses market concerns and bridges it with solutions. A well developed CVP can be a great source of inspiration and motivation for the entire organization. Make sure you allocate adequate time and resources for its construction.