My discussion of value propositions last month struck a chord. Many of you wrote me with questions and comments and thanked me for that EWA. Of those who took the survey, 97 percent said they thought it was “helpful and relevant.” For that reason, I’ve decided to do a second issue on the subject. It’s the closest I’ll come to producing a summer movie sequel. Promise.
--Chuck Lustig, owner, ExcitingWriting Communications

In last month’s EWA, I said a value proposition is a statement that sums up in plain business language the value your product or service delivers.

Now I would like to add: Your value proposition is the reason why you have clients or customers. It’s the essence of the value they get from doing business with you. Equally as telling, it’s the reason why they choose to do business with you again and again.

If we fail to pay attention to and understand our value proposition, we ignore the single most important determining factor in the success of our business.

It’s been said that many successful people don’t know why they are successful. That’s because they choose not to delve into their value proposition.

Last month, I said your value proposition resides at the place where your offering, the marketplace offerings and customer needs overlap. See Fig. 1.

Once we understand those three areas, we can begin to understand how:
· What you offer is alike and different from what everybody else is offering
· What you offer is what the customer needs
· What the marketplace currently offers both satisfies and dissatisfies the customer

Why have any part of your offering fall outside “Your Offering?”

Tom Schneider, manager, Editorial Services at American Heart Association, asked me “What is the benefit of having ANY of ‘Your Offering’ outside the overlapping blacked-in circle?” I explained that while there is no direct benefit to the customer, offerings often require back-end processes, for example, information technology. The customer doesn’t see them; nonetheless, they are essential to the offering.

Tom’s question hits on one of the most important trends in business today—business process outsourcing (BPO). Companies are outsourcing ancillary processes. More and more, a customer-facing business today is only that. Only the core competencies that a customer or client sees are part of the company—everything else is outsourced. Although it may be necessary, there is always reduced benefit in maintaining a part of your offering the customer never perceives to be part of your offering.

What about strategy, branding and positioning?

Strategy asks, “What do we do to grow our share of market?”
Branding asks, “How shall we be known in the market?”
Positioning asks, “Where should we position ourselves among our competitors in our customers’ eyes to grow sales?”
The value proposition asks, “What value do we deliver to our customers?”

The first three questions are more about us than our clients and customers. Only the value proposition question focuses squarely on the client or customer. Don’t you agree that when it comes to business fundamentals, the value prop question is the most important you can ask?

"How do I formulate my value proposition?"

Let’s say you are a CEO who is looking for a new position. You want to formulate your value proposition. You should do a 360-degree analysis of your value proposition:

Go to someone you reported to on the board of directors and ask that person to write a testimonial about your value to the board. Don’t coach them. Let that person decide what to say.

Go to someone who reported to you and ask that person to write a testimonial about your value as a CEO. Likewise, let that person decide what to say.

Finally, go to another C-level executive you served with and do the same thing.

Then analyze all the value statements along these lines:

· How what you offer is alike and different from what everybody else is offering
· How what you offer fits with what companies need today
· How what you offer might both satisfy and dissatisfy prospective boards of directors

Based on that analysis, you should have some interesting insights into your value proposition.

If you’re a company that wants to develop its value proposition, you do the same thing. Only, in this case, you might choose:
· One or more customers from various customer segments
· A representative of your channel
· A representative of your employees
· Representatives from other stakeholders
This effort helps you determine your current value proposition. Obviously, you might want to change the value proposition in order to build sales. I contend that, in fact, changing your value proposition is the only way you can build sales or share of market.

As I said last month, “I admit, this is as basic as dirt,” but when marketing communications and copywriting go awry, it's often due to a faulty understanding of value proposition.

Here’s how one EWA reader expressed the value of this monthly newsletter:

"I’ve been following your monthly EWAs for a year now, and am grateful for your good advice and work experience you share – especially since I am still learning to be a copywriter here in Germany. International viewpoints and techniques from a pro are always a great help, and your EWA is an excellent addition to my common reference books! Keep up the good work, and a big THANK YOU from across the seas!"
--Nadine Doinke

Here’s how one client of ExcitingWriting Communications summed up the value of my writing service:

“It was a pleasure working with you on our first newsletter. Your words made the difference between good and excellent. At the Texas Hospital Association convention, people stayed in our booth and simply read the newsletter. I couldn’t have received any more return on my investment than I had with your ExcitingWriting!!!!”
-Philip R. Einsohn, President
Waterjet Works!
Dallas, Texas

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