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At the heart of a successful business model is a series of customers who value and pay for what the company has to offer. This is the market served. The business model and the business itself should be defined by a statement of the value that the company's product or service offering provides. That statement is the value proposition.

A value proposition describes how a product or service solves problems or offers advantages for a specific customer group. When the value proposition is described in this way, it identifies the market it serves using terms that customers can understand, rate, and evaluate. In other words, the value proposition indicates who will buy the company's offering and how much those customers should be willing to pay. It also defines the size of the market – how many customers need to buy the company's offering and are willing to pay a certain price.

A value proposition is not an advertising slogan or a technical description of the product or service. It is a statement about who values ​​what the company has to offer and what they value about it. Few, if any, companies can serve everyone profitably because customers are different. Some customers have a specific need while others do not. Parents with infants need diapers; most other consumers don't. People who own pets buy pet food; People who don't own pets are unlikely to do so. Some customers value customization and will pay for it. Other customers want a simple product that works and want to pay the lowest possible amount to get a basic benefit. The value proposition defines the business in terms of an explicit group of customers who shop for a specific reason and for a specific price. The value proposition thus answers an important strategic question: Which customers will the company serve?

Examples of value propositions

BMW "The ultimate driving machine"

Dollar Shave Club "A Great Shave For A Few Dollars A Month"

Intuit "Simplify the Business of Life"

Lyft "A ride in minutes"

Netflix "Watch Anywhere, Cancel Anytime"

Ritz "Ladies and Gentlemen, Ladies and Gentlemen"

Goal "Expect more, pay less"

Walmart “Save money. Live better."

Zillow "Find your way home"

ContriBranding Strategy Insider: David Stewart, Professor of Marketing and Business Law at the President of Loyola Marymount University, Author, Financial Dimensions of Marketing Decisions.

The Blake Project can help you define the unique value of your brand in the Brand Positioning Workshop

Brand Strategy Insider is a service from The Blake Project: A strategic brand consultancy specializing in brand research, brand strategy, brand growth and branding

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