Creating a Great Value Proposition

By Chris Goward, an EO Vancouver member and CEO of WiderFunnel Marketing Inc.

Companies and marketplaces are dynamic. As an entrepreneur, you know this better than anyone. I started WiderFunnel as an innovative conversion optimization agency for high traffic websites in 2007. Since then, due to growth and changes in the market, we’ve overhauled our service offering, moved headquarters, shifted clientele and developed a cohesive team of A-players.

We’ve experienced a lot of change, but one thing, however, has remained a constant: my commitment to having a clear value proposition.

That doesn’t mean our value proposition hasn’t changed over the years. It has to evolve to keep up with the changing market opportunities, as I am sure yours does too. What hasn’t changed is the rigorous testing we use to make sure our value proposition message is on target.

The key to creating a great value proposition is knowing which benefits are most important to your prospects.

As a marketer, you want to be able to communicate all the features and benefits your prospects could get from your products and services. But, if you try to emphasize everything, you’ll say nothing. As the psychologist Barry Schwarz explains in his book, The Paradox of Choice, more choice and more information often creates more anxiety.

So, how do you know which features you should emphasize with your customers? Here are three ways to build your value prop, and to make sure it hits the mark.

Hypothesize!

When your opinion carries more weight than anyone else’s, your ideas may be implemented even when they’re not the best.

The same thing happens in your marketing department. While traditionally, marketers have relied on their own thinking to determine which features to emphasize, today, there’s a better way. By A/B testing different value proposition approaches and using a controlled testing methodology, you can find out what works best with statistical certainty.

Your prospects, products and competitive environments are unique. To find out what works best, create value proposition hypotheses. Once you decide to test your ideas, you can still make the mistake of testing poorly. The only way to get great test results is to have great hypotheses.

I’ve created a framework you can use for identifying new value proposition ideas to test.

I call it the “POPs, PODs and POIs” framework. It illustrates how your Points of Parity (POPs), Points of Difference (PODs) and Points of Irrelevance (POIs) interact:

• Points of Parity (POPs): features you offer that are important to your prospects, and that you share with your competitors. These are the entry requirements to the game. Your prospects need to know that you offer the POPs, but emphasizing them won’t impress anyone.
• Points of Difference (PODs): features that set you apart from your competition. They are important to your prospects and not available from your competitors.
• Points of Irrelevance (POIs): all the other features that you offer, but aren’t that interesting to your prospects.

Use this concept to brainstorm your PODs, POPs and POIs with your team to create new value proposition concepts to test. In the end, your value proposition should Focus on Your PODs!

Use Landing Pages

Now that you have a hypothesis, you need to have an outlet to test it! The best places to do test is where new visitors flock – website entry pages. This may be your home page or landing pages, depending on your website traffic patterns. Your web analytics traffic report will give you an idea of which entry pages get the most visitors.

By split testing your control and challenger value proposition hypotheses, you can find out which messaging motivates your real prospects to act. Testing on landing pages can do more than only improve conversion rates for that page. When done strategically, you can apply the resulting insights to the rest of your marketing strategy.

Businesses are dynamic, and value proposition is no exception. Amidst all the change, make sure your messages meet your prospects’ needs. Use these three steps to test your value propositions continually and you’ll always stay ahead of your competition.