Let me ask you a question: When was the last time you thought about your company’s Unique Value Proposition (UVP)? I know, “UVP” sounds like one of those things that some MBA pinhead or some Silicon Valley VC dreamed up somewhere along the way. (And, yeah, you’d probably be right.) Anyway, this one really is a valuable concept. Let’s pick it apart a bit and I’ll explain why.
Let’s start by talking about what a UVP actually is. A value proposition is basically a statement that has three elements: (1) what your company does, (2) for whom you do it (or plan to do it), and (3) what’s unique about it. It sounds so easy when you just read that sentence, doesn’t it? But as many of us know there is a ton of thought that needs to go into crafting that simple statement for your company.
Many of us are just so buried in our day-to-day business that we just never raise our heads up to think about some of the important strategic questions. Trust me. I get it. But those things are important to the long-term success of your company. You have a responsibility as the leader to know what the company’s trying to accomplish and the path you plan to take to get there. And an important part of all that is to be clear about what sets your company apart from all the others. This is the core of what gives your business personality.
Think about it from the other direction too. The UVP is that thing that takes your long-term mission statement and makes it “real world”. Say someone says to you “That high-falutin’ mission statement sounds nice, but what do you really do every day?” This is the answer. This is the practical description of how your company is positioned.
Why is all that important? Knowing your UVP brings several benefits:
- Easier decisions. Because you and your team will make decisions (both the big ones and the everyday ones) aligned with what makes you unique.
- Branding and marketing. Your branding and marketing efforts will be guided by emphasizing what makes your company unique.
- It makes your sales efforts easier because you can quickly explain what sets your company apart – your competitive advantage.
- Employee confidence. Your team knows exactly what your business does (and doesn’t do) and why it’s special.
Here’s an example that may help. Say your company is a small, local bookstore. A person can acquire books in a whole bunch of ways – other local bookstores, larger bookstores like Barnes & Noble, online sources, libraries, etc. So what will draw someone to your store instead of all the other ways they can get books? What is that one big thing (or combination of things) that sets you apart? What is it that no one else has? You’re in a convenient location. You’re locally owned and part of the community. You’re friendly, helpful, and knowledgeable. The experience in your store is something remarkable – the scents, the music, the coffee, the comfortable layout, the reading chairs and couches. You carry specialized books that no one else does. You’ll deliver their products within a few hours. And the list can go on and on. The key is to find that mix of things that makes your business unique and attractive to your customers.
If I stop by your business today and ask you and the first three people I see what your UVP is, what would they say? (And, yes, I’d ask it in plain English and not try to sound like some snotty MBA-level textbook.) If I wouldn’t get an immediate and clear answer, you should invest some time to develop one and make sure everyone knows it.
So right now you’re probably thinking “Wow! You sound like some really smart MBA-like guy! How do I create one of these UVPs?” (Yes, I’m aware that in reality you probably deleted the phrase “really smart” and changed the word “guy” to “pinhead”.) But stick with me. You’ll find this is useful real-world stuff. It will really give you and your company a lot of clarity about where it’s headed and why it’s unique; and that’s a good thing.
So, here are some ideas about how to tackle putting together a UVP for your company.
DEFINE THE PROBLEM
First, you have to know what the problem is you’re trying to solve. It sounds simple and obvious but it’s really not. It’s important that you clearly define the problem is that your company has decided to take on. There are a few elements to this:
Define WHO is experiencing this problem. Describe them in as clear terms as you can. Describe their different characteristics. Try to form as clear a picture as you can of this person. That’s often called an “avatar” or a “persona”. (I know, I know – pinhead stuff again.)
Outline exactly what problems they are having. Describe any specific situations when the problem arises.
Try to quantify the problem as best you can. Ask prospective customers what this problem costs them. If you can’t get true numbers try to make an educated guess.
IS IT A PROBLEM WORTH SOLVING?
Step back for a minute. Does this feel like a big enough problem (either tons of customers need it and/or the cost of the problem is big enough that customers are willing to spend enough money to solve it)?
A mobile phone app may only sell for a dollar or two. But if it solves a real problem for millions of people you may have a business on your hands.
Your product may solve a problem that costs manufacturers (or bankers or whoever) millions of dollars each year. If so, they may not need tons of them, but they will spend a lot to solve that problem. Again, it might be a problem worth solving.
DECIDE IF YOUR SOLUTION IS UNIQUE ENOUGH
Be honest with yourself. Who else is doing what you are doing or targeting the same problems you are. We like to think that no one else is trying to do the same thing, but that’s almost never true. Really do your homework. Do a thorough Internet search. Ask people in your target market who they would contact to solve that problem. List out these competitors. Outline what products and/or services they provide.
Now look at your solution. How is it different? Where does that uniqueness lay? Does it truly approach (and solve) the problem in a new way? Does it disrupt the way things have been done before in a positive, valuable way? Put yourself in the customer’s shoes. Would your solution be unique and compelling to them?
You may come to the conclusion that it’s not unique enough. That’s okay. It’s tim to brainstorm how you can change things to become more unique. Now that you clearly understand the problem, the customer, and the competing solutions you can start to develop something that’s different.
If your solution is already in the marketplace, you also need to take the next step: understand the impression people have of your company and your solution. Is your company viewed as having a unique solution? After all, it’s one thing to think you have something new and different, but if the world doesn’t actually see you that way, you have some work to do.
CRAFT A UVP
Now bring it all together. Actually work with your team to write it down. Argue over and debate the words. Trust me, it’s healthy as long as it’s productive and respectful. What you’ll find is not that people are actually arguing over the exact words (OK, yes, sometimes they are.) Often they are debating the underlying ideas. They are making sure that the “right” ideas are included (and excluded). This is a very important step. Underneath it all what you are doing is building consensus and “buy-in”. You are letting the team air their differences of opinion. You are allowing them to arrive at a common conclusion about what positions your company in a unique way. When the dust settles you will have a value proposition that clearly spells it out – and a team that knows it and agrees with it. Powerful stuff.
KEEP SHARING IT
OK, there is one more step. Actually it’s an ongoing activity. You did the hard work of crafting a well thought-out UVP. Now let the world know what it is. And start with your own team. Everyone inside your business should know it by now. But, anyone who might not have been a part of crafting the UVP must be brought up to speed. It’s also something to share with prospective employees.
Thinking outside your company’s four walls…let the rest of the world know what your value proposition is. Of course, you’ll share it with customers and prospective customers. But, it should also drive your branding and marketing efforts. It should be at the heart of how you tell others about your company – and how they understand your brand.
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