Is it fair to say that there is a distinct difference between a company’s value assertion and its value proposition? Or, is this nothing more than a play on words, one where both essentially mean the same thing? Well, yes and no. For most companies, these two are interchangeable. They mean the same and in essence, have the exact same purpose. However, there is a distinction, and it’s one that some companies understand completely. In fact, they use this knowledge to their advantage in order to provide a tailor-made, turnkey solution that allows them to capture business.
Your Company’s Value Assertion
A company’s value assertion is a declaration by a company to its market, its customers, and its suppliers, about what the company brings to the table. It’s more direct in nature and is used by companies to better define the company’s business model, define the company’s uniqueness, and most importantly, to distinguish the company’s product and service offering. However, how does a company come up with its value assertion? What information does it need in order to provide one singular message to market?
In order to answer that aforementioned question, think of everything your company knows about its market. Now think about what you want your customers to know about your company. Your company’s value assertion is ultimately about uncovering those common needs for all customers within your market, and then defining how your company addresses each of those needs. For instance, your market may be used to dealing with a certain type of supplier, but is there something they’ve always wanted that your company, and its competitors, have been unable to provide? That’s where you need to focus your efforts on.
The above video is from the post: Your Value Chain Defines Your Value Assertion: B2B Marketing Essentials
Granted, there may be no differentiating factors in your industry other than price. However, this is ultimately why having a value assertion is so important – it helps your company to distinguish itself in what would otherwise be seen as a “me-too” product offering, one where there are no differentiating factors. To help guide you along, please refer to the table below. It provides three simple questions where each one is followed by tips your company can use to distinguish its value assertion.
Why do Customers Buy Your Product?
- Focus on why customers buy even when your price is the same, or higher, than your competition’s.
- Identify the reasons your customers are loyal. It could be related to your customer service excellence, your sales team’s professional approach, your accounting department’s flexibility.
- What makes your biggest customers loyal, and can you replicate these conditions with other customers?
What Problems Does Your Product & Service Solve?
- Don’t just focus on your obvious product benefits. Expand your view to include how customers value your company’s service. For instance, is your company highly valued by certain contacts within your largest customer accounts? If so, why do these individuals value your company?
How Does Your Company Compare to its Competition?
- Never ever do a direct comparison in front of your customers. Never make a claim about why your company is better than its competition. Instead, understand why and make it part of your value assertion.
Understanding the Value Proposition
The value proposition is a tailor-made solution, one where the company meets the customer’s unique requirements. A company may have a value assertion, but after speaking with the customer, there may not be an “ideal” fit for both companies. This is why it’s so important to both manage the customer’s expectations, and identify those specific customer needs that lead to winning business.
The value proposition works by taking that customer’s unique needs and tweaking the company’s product & service offering in order to meet those needs. This often involves an assessment of the costs involved in meeting the customer’s requirements, which could include upgrading the company’s service capabilities, or offering concessions on the product itself – such as price, delivery, stocking arrangements etc. The following explains what you need to consider when providing a value proposition to a specific customer.
What Does this Specific Customer Need?
- Define what this customer needs and what changes, if any, your company must make to its service capabilities.
- Focus on the costs involved in providing a service upgrade. What are these costs and is this something you’ll need to charge the customer, or will you absorb this yourself?
- Use the customer’s business volumes as a justification for offering concessions, BUT, be sure to get a concession in return. In essence, match a “concession for a concession”.
Comments