If you want to stand out from the competition, and outperform it, you must be able to best define your Unique Value Proposition. This is the guide that tells you, in simple words but in a comprehensive way, how to develop a unique value proposition that is truly successful. Let’s start with the basics and, that is, what a UVP is.
What is the Unique Value Proposition (UVP) and why is it important
The Unique Value Proposition, also known as the Unique Selling Proposition, consists of a simple, unambiguous statement that summarizes in a few words (very often in a single sentence) how your product or service differs from those of your competitors. The UVP focuses on the benefits the product/service provides and the problems it solves. In addition to this, the Unique Value Proposition also encapsulates what comes to customers’ minds when they think of your product or service.
How to define a Unique Value Proposition for your Startup
To find your Unique Value Proposition you can turn to a special visual thinking tool called Value Proposition Canvas. You need to know, more concretely, that there are essentially three steps to defining a winning UVP. And you are about to discover them in the next few lines.
Know your ideal audience
To best define your startup’s Unique Value Proposition you must, first, identify your target audience and, more precisely, the needs and desires of your ideal audience. There is an “easy” way to find out, actually two: interviews and validation questionnaires.
Analyze your competition
Knowing your audience will not be enough to develop a truly winning Unique Value Proposition; you must also analyze, in fact, the market in which you operate and your direct and indirect competitors, through market analysis and competitive analysis.
Leverage the strengths of your product or service
The third step is where you need to move from theory to practice: make it clear right away what sets you apart from the competition, emphasizing the strengths that make you the best solution to your customers’ problems.
As you develop your UVP, you need to be guided by your startup’s mission so that you remain consistent with the goals you set. Remember: as Seth Godin said,
“No one buys a product or service; they buy relationships, stories and magic.”
Examples of Winning Value Propositions
You now know how it is possible to develop an effective Unique Value Proposal, but some examples from those who have gone before you in this challenge can help you better understand how to draft a truly successful one.
Among the examples of winning Unique Value Propositions, one that recurs often is that of Uber. The UVP of the San Francisco-based company, which offers a private car transportation service, is “Get in the driver’s seat and make money.” The message, aimed at all those people who want to make money simply by driving and offering rides to other people, comes through loud and clear in just 5 words.
Even fewer words were enough for Too Good To Go to describe what it does and how it differs from its competitors: it “saves delicious food.” Too Good To Go is in the business of connecting people to restaurants and stores that have unsold surplus food, which is offered at a reduced price. This last detail is clarified by Too Good To Go in an afterword to the “main” UVP: “… At a super price.”
Another example of a winning Value Proposition is that of Apple Watch. The Cupertino-based company chose a focus on health as its differentiator to be conveyed first and foremost with its Unique Value Proposition, which reads, “The future of health is here. On your wrist.” In this way, Apple responded to a concrete need of the public by leveraging its strengths (such as, for example, the ability to take an electrocardiogram anywhere, anytime.
How to Validate Your UVP
The main tool for validating a business idea is the so-called Minimum Viable Product (MVP). This is a version of the future service or product proposed by the startup, which, although not defined in every detail, can already be used by a user. At its core, the MVP must contain the UVP, that is, those essential features that distinguish it from the competition and make it the best solution to customer problems. The Minimum Viable Product allows useful feedback to be gathered to make adjustments to the initial idea where needed.
Smoke Test is a validation tool based on the basic realization of the business idea. For example, it may consist of a landing page where the startup’s product or service (which, however, does not yet exist in reality) is shown.
Why Unique Value Proposition is crucial for modern startups
It may be a platitude, but never before has competition in any industry been as fierce as it is today. Distinguishing oneself from what competing brands offer and, even more so, communicating this differentiator to the best of one’s ability, is therefore crucial for modern startups because it allows them to stand out and capture the attention of their audience. UVP, moreover, plays another crucial role in communication, since the entire marketing strategy revolves (or, rather, should revolve) around it.
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