Industry
Retail
Omnichannel Experience & Intelligent – The Future of Retail
Highlights
- In a crowded online market, what differentiates your product from others is your value proposition. It nudges the customers to choose your products or services and keep coming back, building loyalty to your products.
- Simply put, value proposition is the additional value you promise to your customers when they buy from you.
- Value proposition could be your product’s unique selling proposition (USP), a slogan or tagline, or even your company’s logo that promises to deliver more than just the product itself.
On this page
Drawing a lesson
A bright morning, a hot cup of tea or coffee, and a newspaper — an ideal start to the day! Well, I am not here to describe a “good morning” but to draw a lesson in retail from the humble newspaper delivery boy and the milkman.
In delivering your favorite newspaper or your preferred milk brand to your doorsteps daily, they bring a truly focused customer experience for us. Whether it is a cold, foggy morning or a rainy day, you can count on them to deliver. Yes, that’s the business value they bring with newspapers/milk.
Okay, let’s play a quick game.
Assume you are a startup online retailer. Now, access any popular search engine and look for comparable products you sell. Got the results? Now, spend 60 seconds analyzing them.
The search has thrown up various products from online retailers that your potential customers might like. These items could be similar in quality to yours or better, and others may be of inferior quality. Even if your products come up on top of the page rankings, what is the probability that customers will buy from you?
Now ask yourself: “Why should customers buy from me and not from my competitors”? Indeed, you have an answer to that, but is that well-articulated? That is exactly what value proposition is — the most important decision-making argument for customers. If you have strongly communicated your contextual values, you will surely notice significant growth in conversion rate and reduction of customer churn.
Understanding value proposition
It’s simple. The value proposition is the promise of an additional value to your customers that helps them make a purchase decision.
Only by reading that statement can a customer understand the worth of buying from you. That promise differentiates you from competitors. For instance, a headphone maker can promise to deliver noise cancellation, or a pizza chain may promise to deliver within 30 minutes.
Terminologies such as USP, slogan, and value proposition complement each other. A slogan or a tagline is usually a simple, short phrase that summarizes your value proposition, while USP is your unique selling proposition. For instance, TCS’ foundation is based on belief, which is well expressed by our slogan, “Building on Belief.” Sometimes, marketing teams want to articulate that through a brand logo.
Articulating value proposition
To successfully sell products online, it’s essential to have a deep understanding of your customers’ demographics, psychographics, and market segmentation.
With this knowledge, you can create a compelling value proposition that sets your business apart from the competition, ultimately driving sales and achieving success.
Customer segmentation: The products you sell may be used differently for different target customers and purposes; accordingly, consider multiple value propositions. A T-shirt may be used as business casual or in sports. A computer designed for students could also be a perfect fit for front-office executives. So, the targeted customer may vary depending on their interests, location, age group, gender, and sometimes even income. A luxury vehicle manufacturer’s car models are only for premium customers. Similarly, a famous fashion brand designs their clothing only for women.
Multi-channel: As a retailer, you sell multi-branded products, and you must maintain numerous value propositions at every entry point that your potential customer uses--social channels, marketing campaigns, eCommerce homepage, category landing page, search results page, product details page. That message should always be evident to customers irrespective of channels or where they enter your website.
Contextual: Your products are the solutions to a customer’s needs, and you must mention it. You must specify the challenges you are going to solve or the possible areas your products are going to be used. For instance, a popular apparel and footwear brand may sell only “workout clothes.” Sometimes, it is equally important to present statistical information for better articulation for branding, like “8 actions” toothpaste or health drink with “23 vital nutrients”.
Stay tuned: Keep your eyes open and analyze your competitors, visit their public websites, watch YouTube channels and Facebook pages, and study analyst reports.
Benefits of a value proposition
There is no standard definition of value; it could be based on the organization, product/service, and or audience.
While setting the value proposition of your organization, you should ask what is my definition of value? It will help you understand your strengths and the target group.
Your value proposition statement goes deeper into your brand image. With this, you promise your customers to build a long-term relationship. This enrichment exercise is unique to your brand/product and fundamental to your business operation. It provides an evident reason for customers to continue their loyalty to you. Your product manager, marketing department, and creative teams must be aligned with this exercise to bring superior customer experience.
