Introduction

The ways of advertising your service or product to potential customers can prove to you very important when growing your business. Quantifying your value proposition is one of the several example techniques to achieve this goal. In this article, I will explain what a value proposition is, why it is important to quantify it, and how the relationship between customers and your business will improve if you do so.

Key Note #1: What is the Value Proposition (VP)?

A company’s goal is to provide products and/or services to customers; however, everything can also be used as a VP. That is, value proposition acts as an umbrella to any activity a company has, including growth communications, marketing, sales, etc. It is crucial because it provides an answer to the following three questions:

Is there a problem solved or an improvement made that a customer is willing to pay for?

Do your customers derive any value from using your product, which can be described in total measurable terms?

What would motivate the customer to buy your product rather than another product offered by your competitor?

It is crucial to remember that your company’s value proposition is not some slogan or positioning statement of some sort. A great example is the company Apple. Their tagline is “Think Differently” yet their value make proposition is concentrated on their innovation, features, services and aesthetic appeal and style. The Apple example illustrates how a singular value proposition based on a company’s innovation affects other tangible propositions around features, services and aesthetic appeal for the company.

Key Note #2: Why it is Important to Quantify the Value Proposition (QVP)

Proposition value quantifying is labeling a measurement to the advantages offered by a product. This makes it easy for customers to appreciate your value and makes your proposition unique. Quantifying value helps understand how much customers will get compared to what they are spending.

Let us analyze his using an illustration.

Example: Consider a firm that produces a novel ink. They intend to sell it at the national level and have split their sales force into two teams.

The first group sells the value proposition “sans numbers.” They discuss in vague terms the benefits, describe the technology, and differentiate it from the other inks in existence.

However, the second group tells them how much value they are selling. This group vividly points out that the new ink lowers errors by 6 percent, is 67 percent faster in drying than ordinary inks, and is less expensive by 12 percent.

The customer, on seeing these figures, has no reason to question them. They can readily see the usefulness of the second team’s ink and if the statements made are proven to be true, the buyer is more likely to become a loyal customer.

Quantifying the Value Proposition (QVP) refers to the three questions of value determination:

Better: In what ways is your product superior to competitors? What tangible value does it offer to the customer’s life?

Faster: In what ways is completing activities faster with your product in comparison to other products?

Cheaper: Is your product affordably priced in comparison to similar products in the market?

Using these quantifiable metrics helps develop greater trust with the customer which can lead to greater conversion rates and customer loyalty.

Key Note #3: Aligning QVP to Your Target Customer’s Priorities

When considering the quantifiable value proposition of your business, it matters how your messaging is aligned with the priorities of the person you are trying to sell to. There are two main methods to accomplish this:

Focus on Persona: A Focus on Persona approach deals with understanding the key priorities of your target customers. By understanding the complete life cycle of how customers interact with your product, you can tailor the value proposition to ensure the most impactful benefits are captured.

Example: Take a look at SensAble Technologies. They operate in the Business to Business sector, where they design industrial products for the toy industry. Their clients are companies that need toys based on movie or game characters to be produced and put in the market within the shortest time possible. It is very important that a toy based on a popular movie or game gets released within the appropriate time frame. Otherwise, it will no longer be relevant.

To meet their client’s demands, SensAble Technologies modified their value offering to be more speed focused. They delivered toys to the market on average 40% faster than their rivals, which helped them delight their customers who were already valueing speed. In this case, integrating QVP would customer priorities increased customer retention.

To comprehend their customer’s pain points more clearly, one should analyze the as-is state which refers to how the customer is currently functioning without your product versus the possible state which is the changed scenario after the client uses the product.

As Is State includes:

The still existing processes or experiences.

Existing gaps or challenges that the customer has.

The reasons that are making it hard for them to receive value.

The possible state depicts the additional benefits which include higher productivity, lower cost, and better output quality which the customer is expected to enjoy post adoption.

You first must measure the gap between the two conditions. This will enable you to design a precise and easily understood QVP. Further elaborating on this gap with a chart aids in delivering the changes your product brings to your customer in an easily understandable manner.

Example: Take the case of InTouch, a company that developed a device enabling pregnant women to monitor the health of their baby conveniently. Previously, expectant mothers used to bear the discomfort and inaccuracy of heart monitors. On the other hand, InTouch’s device was user friendly, accurate and economical.

The company put together the as-is state of modern expensive heart monitors that uncomfortable to use as well as inaccurate and the possible state of easy-to-use as well as accurate and affordable heart monitor. This subsequently helped them created a quantifiable value proposition which resonated with the target audience because it focused on their priorities ease of use, accuracy information and affordability.

Key Note #4: Benefits of Quantifying Your Value Proposotion (QVP)

Providing a value proposition without measurement has many cons.

Lack Of Definition: A measurabe value proposition enables the customer to take known and measurable benefits. It is unquestionable what the customer will receive from your product.

Targeted Objectives: You can specify the exact objective your product guarantees intervention for. This may be a decrease in costs, increased speed, or heightened efficiency.

Product Differentiation: Not only does a QVP refine your product, but it also separates your product from competition. Your it product gets noticed because it proved specific, measurable, and quantifiable advantages.

Visual Comparisons: Value propositions are always easier with images. These make it easier for the customers to understand the benefits in the as is and the possible states.

Example: For InTouch, the as is state was people using inaccurate and uncomfortable devices of self monitoring. While the possible state was using a self monitoring device that is accurate, affordable and comfortable. This strong and clear comparison made customers buy the product.

Key Note #5: Why is QVP Important?

Just like any value proposition, quantifying QVP does not only make it more interesting, but also has tactical business benefits:

More Compelling: It is much more compelling armed with facts and figures and it is ,single handedly, one of the greatest selling points of your product. A potential customer would rather deal with a proposition that’s not abstract.

Selling Ammunition: A QVP makes it easier to deal with clients who have a lot of competitors. It helps the QVP become a weapon for converting leads into customers, especially the difficult paying ones in the business to business market.

Easier to Price: When there is a clear proposition, it gives breathing space to always justify the price of the product with the competition in the market.

Differentiation: QVP always set metricsate quantifiable difference between your product and competitors, display unique features that instantly separate your product from the crowd.

Conclusion

Quantifying value proposition (QVP) works wonders by allowing your potential customers to appreciate the benefits a product offers. When customers recognize the differences that make your product better, faster, or cheaper, their trust in your business grows, bringing in more revenue.

When integrated with customer concerns and distinctly different from competitors, your QVP becomes a salesperson’s delight and makes it simple to Price, Sell and Promote the product. If you’ve reached this stage in your startup journey, congratulations, you are on your way to building a product that your customers will love.