Cayenne Consulting

How to Create a Compelling Customer Value Proposition

Customer Value Proposition

Create a Compelling Customer Value Proposition

When asked to describe their customer value propositions, most entrepreneurs start reciting a laundry list of product features. Features are near and dear to the hearts of most people close to the product, whether they are software and hardware engineers, marketing folks, or those in operations. But most customers do not care about features. They care about benefits.

“Price is what I pay,” said Warren Buffett famously. “Value is what I get.” Value is what a customer derives from a product. Most companies are unable to articulate the customer value they offer.

When I worked at HP two decades ago, it was an engineering-driven firm, deeply afflicted with “next-bench syndrome,” which meant that the engineers were most comfortable designing products for their colleagues sitting next to them. It worked very well for the company so long as it remained in technical and scientific instrumentation segments, where it was by far the market leader. But when it ventured into consumer products such as PCs and calculators, the next bench syndrome hurt its chances to succeed. The company was so feature-driven, that we used to joke internally that if HP were to sell sushi, they would call it “cold, dead fish.” Accurate, but hardly palatable. It describes features, not benefits.

There are 3 ways to approach customer value proposition creation:

When crafting your value proposition, start with brainstorming sessions to develop three specific statements describing the job to be done, customer pain relievers, and gain creators. Then synthesize these three ideas into one compelling customer value proposition. Now you are ready to delight the customers.

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