Developing a Value Proposition

Value propositions answer the question "What value do I offer to others?" in the majority of cases those others will be your customers. Value propositions, however, can also be used for job seekers and those seeking to lead others in a cause.

A value proposition is different from a Vision or Mission Statement in that the audience for the value proposition is internal to the organization. The purpose of a Value Proposition is to identify the capabilities inherent to the organization that make it valued by their customers. The Value Proposition by identifying value within the firm becomes a tool for the development of various communications messages such as Tag Lines and Selling Propositions. The Value Proposition aids in creating these different communications by ensuring that they align with the identified value.

In terms of form a Value Proposition is typically a concise 3 or 4 sentence statement summarizing what it is that makes the organization unique, special, interesting, or in a word valuable to others.

In terms of creating a Value Proposition the organization needs to follow a five step process as represented in the Table above and the points below:

1.Start by identifying those competencies that it possesses which are believed to represent its' core strengths. Suggestions for where to look for these competencies would include:

  • ¨ What significant "Firsts" has the organization achieved?
  • ¨ Do you offer any truly unique products?
  • ¨ Is there an element of your customer service which could be considered exceptional?
  • ¨ Has the organization been recognized for excellence by others outside of the organization? If so how?
  • ¨ Is there a specific knowledge base within the organization that is not easily replicated by competitors?
2. Determine the proof points that support the identified competencies and confirm their validity.

3.Identify what the value is to the customer of the competency that you have identified. By having this particular competency what problem do you help to solve for the customer?

4. Identify what benefit the customer receives from the fact that you possess a particular competency.

5. Use the information gathered above to craft your Value Proposition.

Once the Value Proposition has been created it should be measured against the various functional areas of the company to confirm that they are supporting it. If you have parts of your organization that do not support the Value Proposition the reason for the non support must be identified and addressed. Value Propositions are not piecemeal in nature and must be supported across the entire organization in order to be of use. It also makes sense to test the value proposition with selected customers to ensure that it truly does resonate positively with them.

Once completed the Value Proposition becomes a guide to follow when communicating to others. A final point would be that as we move more and more to having multiple conversations with our customers, as opposed to targeted one way communications, from a wider cross section of the organization it is increasingly important that the Value Proposition message is widely understood internally. Having knowledge of the Value Proposition and what it represents will serve to enhance the quality of the customer conversations.


Scott Van Wagner is a native of Toronto and a graduate of Ryerson University. He is a marketing expert, with a strong sense of commitment to the needs of his clients and believes that marketing must start with the customer. Scott teaches sales and marketing at colleges and universities across the province. He shares his experience through story telling, helping those in need of marketing strategies to relate and remember what they learn. Scott has strengths in strategic planning, business d...

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