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How to Build a Value Proposition in Sales
RAIN Group
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Written by Mike Schultz Co-Founder and Strategic Advisor, RAIN Group “This includes competitor differentiation and is supported by relevant statistics to help prove the benefits of working with you and your brand.” With an understanding about how this applies to your organization, you can put your selling efforts to work much more effectively, combining the components of your value proposition with different methods of communication to match your buyer. The Importance of a Value Proposition Your value proposition should be written to target key decision makers. As such, it gives you a shorthand to communicate how your organization can help alleviate pain points and attain goals. With limited time to impart this information, being able to understand and present your value proposition is a critical seller capability. In addition, buyers are more informed than ever. Many join conversations having already researched you and your organization. Your value proposition is what elevates you above buyers’ existing assumptions, educates them on new possibilities, and guides them toward a solution they’re invested in. The collection of reasons why people buy typically fall into three major buckets that form the three rules of winning value propositions: Buyers have to want and need what you’re selling. You have to resonate. Buyers have to see why you stand out from the other available options. You have to differentiate. Buyers have to believe that you can deliver on your promises. You have to substantiate. Components of a Value Proposition What happens if you don't follow all three of the value proposition rules? As you can see from the graphic above, take any one of these away and it makes it much more difficult to sell. Remove resonance and people just won’t buy what you’re selling or won't buy it from you, because what you bring to the table isn't important enough. They also won’t be willing to move forward with any amount of urgency. Remove differentiation and there’s no clear indication that you’re the best choice. The buyer will pressure your price or attempt to get it someplace else.
Written by Mike Schultz Co-Founder and Strategic Advisor, RAIN Group “Value propositions are sometimes confused with elevator pitches.” With an understanding about how this applies to your organization, you can put your selling efforts to work much more effectively, combining the components of your value proposition with different methods of communication to match your buyer. The Importance of a Value Proposition Your value proposition should be written to target key decision makers. As such, it gives you a shorthand to communicate how your organization can help alleviate pain points and attain goals. With limited time to impart this information, being able to understand and present your value proposition is a critical seller capability. In addition, buyers are more informed than ever. Many join conversations having already researched you and your organization. Your value proposition is what elevates you above buyers’ existing assumptions, educates them on new possibilities, and guides them toward a solution they’re invested in. The collection of reasons why people buy typically fall into three major buckets that form the three rules of winning value propositions: Buyers have to want and need what you’re selling. You have to resonate. Buyers have to see why you stand out from the other available options. You have to differentiate. Buyers have to believe that you can deliver on your promises. You have to substantiate. Components of a Value Proposition What happens if you don't follow all three of the value proposition rules? As you can see from the graphic above, take any one of these away and it makes it much more difficult to sell. Remove resonance and people just won’t buy what you’re selling or won't buy it from you, because what you bring to the table isn't important enough. They also won’t be willing to move forward with any amount of urgency. Remove differentiation and there’s no clear indication that you’re the best choice. The buyer will pressure your price or attempt to get it someplace else.
Written by Mike Schultz Co-Founder and Strategic Advisor, RAIN Group “To complicate matters further, no two customers perceive value the same way, even in the same sector.” With an understanding about how this applies to your organization, you can put your selling efforts to work much more effectively, combining the components of your value proposition with different methods of communication to match your buyer. The Importance of a Value Proposition Your value proposition should be written to target key decision makers. As such, it gives you a shorthand to communicate how your organization can help alleviate pain points and attain goals. With limited time to impart this information, being able to understand and present your value proposition is a critical seller capability. In addition, buyers are more informed than ever. Many join conversations having already researched you and your organization. Your value proposition is what elevates you above buyers’ existing assumptions, educates them on new possibilities, and guides them toward a solution they’re invested in. The collection of reasons why people buy typically fall into three major buckets that form the three rules of winning value propositions: Buyers have to want and need what you’re selling. You have to resonate. Buyers have to see why you stand out from the other available options. You have to differentiate. Buyers have to believe that you can deliver on your promises. You have to substantiate. Components of a Value Proposition What happens if you don't follow all three of the value proposition rules? As you can see from the graphic above, take any one of these away and it makes it much more difficult to sell. Remove resonance and people just won’t buy what you’re selling or won't buy it from you, because what you bring to the table isn't important enough. They also won’t be willing to move forward with any amount of urgency. Remove differentiation and there’s no clear indication that you’re the best choice. The buyer will pressure your price or attempt to get it someplace else.
Remove your ability to substantiate your claims and buyers won’t risk working with you. They won’t believe you’ll be able to fulfill your promises or achieve intended results. Again, statements that encapsulate the mission and value of a firm are helpful early in discussions. Many buyers are skeptical at this stage, especially if you and your organization are an unknown quantity. It takes time to resonate, differentiate, and substantiate, but it’s worth doing. By summing up your organization in this way, you help buyers understand where and when you can help them. However, there’s always a set of underlying factors and specifics that sway any particular buyer to choose you instead of building an in-house solution, finding someone else to help them, or deciding to do nothing at all. This is where a strong value proposition helps. You need to convince the buyer of the impact of your solution, and what will happen if they move forward with you compared to these other options. To take this a step further, a sales impact model can help you demonstrate financial benefits of working with you and map out the context of your offer. To fulfill these three rules, you need your buyers to be able to answer four important questions. Your Ideal Customer Profile You can’t write a universally appealing value proposition, but by designing it around your Ideal Customer Profile, you can give yourself the best odds of success. Your ICP describes an organization that is best matched to benefit from your solutions, particularly as part of a long-term customer relationship. Note that your ICP is not static; with the breakneck pace of market change, it’s worth reevaluating on a semi-annual basis. It typically includes: Company size Industry Budget Common objections Pain points Aspirations Motivation for buying Their buying process Technological infrastructure Decision maker structure (i.e. buying committees vs. “Why trust covers substantiation. It's where you make the case for why the buyer should believe in you, your offering, your company, and your ability to achieve the desired and promised results.” It just does a little positioning for you. Your actual value proposition—the collection of reasons people buy from you—will be different from one buyer to the next. You’ll discover what it should be for each buyer through your conversations as you learn what they want and need, and who the competition is. Then and only then will you be able to craft the most compelling solution and messaging for them. If you do, the buyer’s perception of your value will be as strong as possible when it counts: when it’s time to buy. Establish Your Value Across the Sales Process In this complimentary guide, we share tips and frameworks for value-forward selling, and how to incorporate it into your conversations with buyers.
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