We can at
last say with some confidence that we are seeing some "green shoots of
recovery". Recent figures have indicated an acceleration in growth and
this points towards a more buoyant economy. Let's not get carried away as we are
still operating at levels below the pre 2008 crash. Nevertheless, the supply side of
the economy is optimistic that interest in its products and services and
hopefully sales will increase next year, as potential buyers at last dip
into their cash hoardings and start investing in their businesses.
A direct
consequence of this improvement in sentiment is that many companies will gear
up their sales machines in anticipation of improved demand. Collectively that
means increased competition for sales.
Also, as
buyers start to loosen the purse strings, their years in a very tight
market will have changed their perceptions of what is important
to them and their expectations of
their suppliers and their solutions. This means that your
product or service may no longer fit the market as well as it once did. As a result the value you bring to your market may be reduced resulting in a
poorer take up of your services and offering your competitors a chance to get
ahead.
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| Identifying your Unique Value Proposition (Photo credit: Intern. Forum Of Visual Practitioners ifvp.org) |
New entrants
into the market will also be seeking ways to differentiate their product to
better reflect buyers changing needs. All these pressures should lead you to
the conclusion that you need to review your value. More explicitly you should
be reconsidering your value proposition and testing its relevance to a changing
market.
Your Value
Proposition
Your value
proposition is a short statement which explains to your target audience what
problem you solve and why they should buy it from you instead of your
competition. What is different about your solution or offering
compared to your competition. It is sometimes called
an elevator pitch or positioning statement. However you
want to describe it, now is the time to give it a review.
It's easy to
become a little blasé about your value proposition after all you know and love
your product. Your target market doesn't have the same attachment and will go
after what they want and will not hesitate to ignore you if you no longer meet
their needs.
I remember
listening to an interview with Jack Nicklaus where he said every year at the
beginning of the golf season he would go to his coach and go through the basics
of his grip, his stance and his swing in minute detail to make sure that he hadn't picked up any bad habits that might affect his future performance. Taking that analogy forward we should
regularly review our value proposition to ensure its relevance.
Your Value Proposition Components
Lets just
remind ourselves what should be included in our value proposition.
What is our target market? Has this
changed? Is our market bigger or smaller than before?
What is the current problem we are solving for
our target market? Is it an important consideration for customers in our market? For
those of you who don’t have a formal value proposition, start with the biggest
issue customers have with your industry and see if you address this. If your
product or solution is less important to your market than previously, then you’ll
have a tough time selling it.
What are we offering? Is it a new
product or service? Can we explain it easily?
What is different about our solution? At this
point many people talk about a unique selling point. For most businesses
finding something that is unique is almost impossible. What you want to isolate
is what you do differently or what additional capability you have, that will
make them buy from you rather than your competition.
Which brings
me to the last point what alternatives are there to what you offer? Why is your offering superior to the
competitions? What is the Return on Investment from adopting your solution?
By asking
yourselves these questions you should get a good understanding of changes in
the market and how that might affect your value proposition. You may be
affected by such things as changes in legislation, new products entering the
market or your industry being more interested in other problems. Unless you answer
these questions, you may well find your value proposition increasingly
irrelevant at a time when your target market will be more active than it has
been for years.
Exigent Consulting provides specialist services to the Small and Medium Business including Managing High Growth, Business Turnaround, and Mentoring. We help business owners improve the profit performance of their business.
