In a recent meeting a potential client – let’s call them Instant Data Co. (IDC for short) – was asking if I could review their marketing material and their sales pitches. They had recently lost out on 4 big proposals in a row. IDC knew the two competitors who had beaten them and felt something was wrong. Based on experience with current and former clients, they believed themselves to be considerably better able to deliver. But IDC had not been able to convince the prospect and could not figure out why.
I asked them what their value proposition was. They looked at me for a bit and then started to explain the features and functionality of their product, why it was better and about how it is the best price point. The IDC CEO talked about their R&D team strength and their length of time in business and their reputation. Continuing on they explained to me how the competitors had none of those things. It even got said that they felt they were so different that they did not have competitors.
I quickly pulled up the website of the competitor IDC had just lost to and we talked about what we saw. The competitor had a clear value statement as well as some great client testimonials and links to case studies and white papers.
The VP of Sales at IDC client quickly pointed out that the competitor had lost several accounts because they had promised all those things but could not deliver and then talked at length about all the scenarios were the competitor was not really up to the job.
I took notes on the various points and at the end asked them if they had discussed any of those points with their prospect. They said no. I asked if any of that information was on their website or in their marketing materials. They said no. “Why not?” I asked. “We don’t talk about our competitors. They are not as good as we are and they are not able to do the job as well as we can” was the answer. “Well you do not have to mention them by name but you can still talk about the situations and how you can deliver on them” I offered, “plus it would be important to pull some of these key points together to use in the value proposition because clearly the prospects don’t know that you can do what your competitors can’t and clearly that would be important to them”.
The CEO thought for a while and admitted that he did not know how they would do that and that they weren’t sure what I meant by a value proposition at least not anymore.
Instant Data Co. is not alone. They saw features and functions of their product. Unfortunately for them their competitors saw the value the customers wanted and spoke to it and undoubtedly did the same when they were pitching prospects.
This situation is all too common and a bit tricky to resolve.
A Value Proposition is a statement of benefit that a business promises to deliver to a customer. It is also an expectation on the part of the customer as to what benefit they will receive and how they will receive it.
It is not features and functions.
It is about what you deliver and how you will deliver it and how the customer will experience or consume that value.
Get this right and the entire sales and marketing process gets super charged.
Get it wrong and you are handing the business to your competitors.
If the customer does not see the value you offer then you will not succeed Period. All the fancy creative and high impact advertising will not work.
It is tricky to resolve because it forces you to look at your products, services and your organizations from your customer’s perspective. For most people that is not their expertise. However it is too important to be ignored and it needs to be done right.