So you built an amazing product but your sales is struggling. Your customer base isn’t growing and you aren’t meeting your MRR goals. While there could be several reasons for this to happen, one likely factor is - having an ineffective software value proposition.
Often startups, especially early stage SaaS startups, painstakingly work on developing their go-to-market but don't spend nearly enough time on crafting compelling value proposition. And that doesn't work if your desired outcome is success. Having poor messaging including your unique value proposition is not only confusing for your customers but it's also unproductive for your overall business growth and long term sustainability.
So what is a good value proposition? . Let's review as well as see how to use them in your SaaS business.
What is a value proposition statement?
Simply put, a compelling value proposition is one that allows you to clearly communicate the value and benefits of your product to your target customers. It highlights your competitive advantage and helps you stand out in the eyes of your prospects by succinctly stating how you solve their pain point, help them achieve their goals and objectives and make their lives and jobs easier.
Think about why you developed your product in the first place. It was perhaps to fill a certain market need or gap; a good value proposition lets your buyers know - why you do what you do and how you do it better than your competitors.
An effective value proposition should be -
Simple and easily understood by your customers
Helping you stand apart from your competitors
Inspiring and motivating enough for your prospects to take action
Let's delve a bit deeper to see what I mean -
1.Customer-centric - Modern selling and marketing is customer-first. In other words, if you talk only about how good your product, service or company is, you’re simply not going to be able to connect with your customers. While product features are important and have their place in your sales and marketing messaging, your customer buys from you when they get the confidence that you understand them - needs, wants, challenges and concerns. Your value proposition needs to be about them and not about you.
Their value proposition - Ignite Growth, Not Complexity - speaks directly to its B2B buyers's desired outcomes and pain point. Retailers (their customers) aren't looking to increase their complexity, instead keep things simple while wanting to stay innovative and growing their business. By using their ecommerce platform, brands can sell and fulfill to their customers who want to buy anytime and across all channels.
2.Simple and easily understood by your customers - Sometimes businesses make their value propositions unnecessarily complex. They use buzzwords and sales jargon or make them too wordy. An effective value prop is anything but. It should be simple, lucid and easily comprehensible by your b2b customer. Your goal is not to impress them with fancy adjectives, instead with meaningful communication, one that they can easily understand.
In an easy to understand fashion, Shopify communicates how it helps its various customers across multiple verticals. Customers can bring their retail operations online, find customers, convert and grow their business as well as manage their day-to-day operations.
3. Differentiate from your competitors - Unless you are the first mover in the space, chances are you have competitors - businesses that offer similar product as yours and target the same customers. So how do you stand apart? Why should a customer choose your product or service over your competitors ? A good value proposition will clearly frame your product in the customer's mind as the solution to their problem. Through product messaging, it will create the much needed differentiation and distinction that is the foundation to standing out.
Example: Adobe Commerce Cloud
Notice how Adobe shares with its customers how they are different from other commerce technology alternatives in the marketplace. They help build frictionless omnichannel digital commerce experiences and not just storefronts. Customers can launch, manage and scale their businesses while providing hyper-personalized experiences to its customers.
4.Be inspiring enough so customers take action - Your product can be innovative but unless you create a meaningful connection with your customers, it won’t gain the kind of traction you are looking for. Specific benefits as well as value your customers will receive once they buy from you can make you attractive in their mind. Think - "what's in it for them" to motivate them to purchase from you.
Notice how Elasticpath promises its customers the benefit of staying agile and delivering on complex commerce vision with ease and speed.
How to use value proposition statement
Today's modern buyers do business differently. They do not like to meet with sales teams until the very end if at all and as they research potential solutions, they appreciate vendors that make it easy for them to make purchase decisions. So as you think about how to craft your value propositions, also think about how you will utilize them effectively in your sales and marketing initiatives.
Think various customer touch points, channels and buyer's journey as you contemplate making your statement visible to your prospects.
Persuasive and highly visible statements should help in driving conversions by helping your prospects as well as your teams in opening buyer conversations and moving them along their purchase decisions.
Now that we have looked at important elements of a compelling value proposition statement, let's look at how to craft one for your business in my next post.