Your value proposition is critical to the success or failure of your startup.
Think about the last time you chose a SaaS product. Maybe you asked a friend or a colleague for a reference. Maybe you went to a review platform like G2. Or maybe you did your own research, saw a few demos and went for it.
Now compare that with the process you used for acquiring a SaaS product 10/15 years ago. Not really the same, right?
On one hand that happens because your standards have changed.
Fifteen years ago we had fewer solutions; way more tolerance for a bug here and there and loading times that were a few seconds more than ideal.
Now? Think about the last time you had something like that happen. And your response to it.
The internet has matured. Digital solutions have matured. The competitive landscape is much more crowded. Users are more demanding than ever. This forces you not only to execute your product spotlessly, and you have to communicate with your users seamlessly also.
If you look at the dozens if not hundreds of other solutions competing for your hard-earned bucks, you’ll be able to draw two conclusions:
- All the others failed to capture your business
- Most likely you didn’t ever choose the best product.
And that’s really important to understand. The graveyard is filled with great ideas.
Often, it’s not the best product that wins customers. It’s the one that communicates its value proposition the best.
The same applies to investors, especially now that we’ve seen startup VC funding has halved in the wake of the tech economic downturn. For you, this means it’ll take more convincing to persuade investors to part with their funds.
So, you must be able to showcase your value quickly and effectively.
And actually crafting your unique value proposition is just the first step. You also need to know how to effectively communicate it.
Below, you’ll find everything you need to communicate your startup’s unique value proposition effectively, from crafting a compelling message to choosing where to share it.
But first, let’s start with how to first identify your unique value proposition.
Before You Get Started: Craft Your Unique Value Proposition
Before you go out into the world and start sharing your startup’s unique value proposition, you first need to ensure you’ve found the right one.
We wrote about this recently in our blog, where we even shared the process we used for the 80+ Startups we helped bring to life over the last few years.
It essentially starts with the following question:
Is this product truly significant to my target market?
This crucial question is imperative to finding your unique value proposition. And, in my experience, the best way to establish a strong value proposition is to follow this structured approach:
- What is the problem/pain your product aims to solve?
- What Value will your product bring to your target market?
- Who is the primary target audience? Understand their demographics, psychology, and behaviour within the observed context. Eventually, create UX Personas.
- How does each target stakeholder currently tackle the problem? Conduct a competitor analysis – either using traditional research or, even better, reaching out to your target market and asking them directly.
- How is it 10x better than any other solution out there? What sets you apart from the alternatives and current competition?
For example, Airbnb enables travellers to manage their trip accommodation in a natural, hassle-free and simple flux with the best value for money, taking into account their concerns for being more genuine and cost-efficient. It also enables owners to rent out their spaces in an easy way, by simply listing the place on the platform once and receiving money exclusively online and offers an affordable solution to the travellers.
Once you have all the answers to the questions above, you’re ready to start structuring how you plan to communicate it with potential stakeholders, whether they’re customers, investors, advisors, hires, etc.
And that all starts with Step #1- developing a concise elevator pitch.
Step #1: Develop a Clear and Concise Elevator Pitch
To communicate your startup’s unique value proposition effectively, you need to first create an elevator pitch that is “SSCC” (Simple, Straightforward and Crystal Clear!)
It should summarise your value proposition in a way that is easily understandable, and memorable and highlights your product’s key benefits and differentiators.
Here’s a template to help you get started and give you an idea of what you should include:
____(Product Name) has been created for ____ (your stakeholders) who ____ (state their problem).
____ (name of your product) is a_____ (statement of its key benefit/solution).
Unlike ____ (the current solution) we ____ (say what differentiates you from the alternatives/your existing competition).
Let me give you an example of how to bring this template to life with a product we recently worked on, Fave. Fave’s founder, ex-senior Product Manager at Google and Youtube Jacquelle Horton, came to us for help building a fan app that allows fans and creators to forge real connections.
Here’s the elevator pitch we reached while scoping her product:
Fave has been created for Fans who want to be recognized and connect with their idols and like-minded people, but their engagement in current platforms is like a droplet in a sea of content, so they feel they can’t express and connect.
Fave has also been created for Creators who aren’t generating meaningful digital revenue streams from their fans. Feeding fans with content on current platforms is too concentrated on the artists’ effort to generate content. They don’t have a lot of intelligence about their fans.
Fave is a fandom-centric community with highly engaging content where fans can create deeper and lasting connections. We keep a healthy community by rewarding positive and meaningful engagement with points that can be redeemed for discounts and exclusive rewards.
Unlike Reddit, we focus on positive enforcement because we believe that is the right environment to develop meaningful engagement and connections.
Unlike Amino, TikTok, Instagram and Youtube we put the Fandom in the centre, enabling one unique channel, condensing the universe of each Artist making it easier for fans to keep up with all the new information and the right framework for the creator to monetize this engagement.
If, once you’ve gone through this process for your own startup, there is any aspect of your elevator pitch that seems ambiguous, you should revisit the list of questions you used to identify your unique value proposition.
If your elevator pitch is absolutely “SSCC” you’re ready for step two.
Do you have a brilliant startup idea that you want to bring to life?
From the product and business reasoning to streamlining your MVP to the most important features, our team of product experts and ex-startup founders can help you bring your vision to life.
Step #2: Craft a Compelling Narrative
Crafting a compelling narrative is an art that involves weaving together different elements to create an engaging and emotionally resonant story. It’s critical to effectively communicate your startup’s unique value proposition.
Here’s how it’s done.
Start with a Relatable Problem
You already identified the problem your product is uniquely positioned to solve when finding your value proposition. Now you need to share that problem with target stakeholders in a relatable manner.
Describe the pain points and challenges in detail, ensuring that your stakeholders not only understand but empathise with the situation.
Introduce Your Hero
Position your startup as the hero of the story by starting with “why”.
Explain why you decided to solve this problem highlighting the passion, expertise and vision you and your founding team possess.
Demonstrate why you’re the right team to tackle this problem effectively.
Showcase Your Unique Solution
Once you’ve detailed that you know the problem inside and out – and that you’re uniquely positioned to solve the problem it’s time to showcase that solution.
Delve into the benefits of your product or service, highlighting what sets it apart from competitors.
Focus on the unique value it brings to your target audience and how it directly addresses their pain points.
Use Real-Life Examples or Case Studies
You should always try to support your narrative with real-life stories.
Ideally, this comes in the form of customer success stories or case studies. Tangible examples like these make your narrative much more credible.
However, if you’re very early stage, you may not have those to hand – and that’s ok.
You can use your market research to create hypothetical scenarios in which users would never have faced the problem you’re trying to solve if they had your solution.
Just be sure to be transparent and let them know that, while you’re confident in your product’s ability to solve the problem, these are hypothetical scenarios and are unproven.
Highlight the Transformation
Next, showcase the positive change brought about by your startup’s solution.
Describe how your product improves the lives of your customers, and quantify the impact using measurable outcomes, such as increased efficiency, cost savings, or improved customer satisfaction.
Appeal to Emotions
Engage your audience emotionally by using storytelling techniques, such as vivid language, metaphors, and anecdotes.
By evoking emotions, you can create a stronger connection with your stakeholders and make your narrative more memorable.
Build Suspense and Anticipation
Be transparent and share the challenges, obstacles, or setbacks that you and your startup have had to overcome along the way.
This not only adds drama to your narrative but also demonstrates your passion, resilience and determination.
End With a Strong Call to Action
Conclude your narrative by encouraging stakeholders to take the next step.
Whether it’s scheduling a demo, signing up for a newsletter, investing in your startup, taking part in a trial, etc.
Make it clear and easy for them to understand how they can take action.
Refine and Practice your Narrative
Finally, continuously refine your story to ensure it remains engaging and relevant.
Practice delivering your narrative in various formats, such as presentations, pitches, or networking events, to ensure it resonates with your target audience.
Also keep in mind that, as your startup grows, your narrative will also grow and develop. Ensure you’re always including any new milestones you hit, real-world stories you receive, etc.
Step #3: Focus on the Benefits
When communicating your startup’s value proposition, focus on the benefits that your product or service provides as opposed to listing features.
By emphasising these advantages, you can help stakeholders understand the value of your startup and why they should choose your product or service over the competition.
This makes it much more appealing than if you were to just tell them about the features. Take the tagline for the original iPod as an example. When Steve Jobs took to the stage to reveal this brand-new innovation, he didn’t describe it as a portable music player with a 5GB hard drive.
Instead, he told the crowd that with the iPod, you could carry 1,000 songs in your pocket.
Potential stakeholders could instantly contextualise 1,000 songs in your pocket, whereas few will understand what a 5GB hard drive actually means.
With that said, here are some tips for emphasising the benefits of your product:
Use Tangible Terms
Communicate the benefits of your product in tangible terms that stakeholders can easily understand.
For example, instead of saying that your startup can improve efficiency, provide specific metrics, such as a percentage increase in productivity or a reduction in cycle time.
Whenever possible, use data to back up your claims about the benefits of your startup. This might include data from customer surveys, market research, or other sources that demonstrate the impact of your product or service.
Be honest and realistic about the benefits that your startup can provide. Avoid making exaggerated claims or promising unrealistic results, as this can damage your credibility.
By emphasising the benefits of your startup in tangible terms and using data to back up your claims, you can effectively communicate your value proposition and convince stakeholders of the value of your product or service.
Step #4: Choose the Right Channels
Using digital channels can be an effective way to get your message out into the world, but you just have to make sure you choose the right ones (and use them the correct way) depending on your audience.
One way to do this is to create a compelling website. It’s often the first place people will go to learn about your startup. It’s vital you ensure that it is easy to navigate and the design you choose is in keeping with the type of business you’re running.
This is also dependent on your target market and the solution you’re building.
Take us as an example here. When I first joined Altar, I quickly realised that our target was the very specific profile of the early-stage entrepreneur.
Entrepreneurship brings with it many challenges and hurdles – which leaves early-stage founders full of burning questions.
So I built our marketing strategy around getting them the answers they needed – when they need them. Solving their problems, regardless of what stage they were in. To do that, we needed a hub to produce relevant content. So we created a website to share articles, case studies, information on how much it costs to put together an MVP, etc.
Just remember, if you discover building a website is the right way to go for your startup, it needs to highlight your value proposition clearly and concisely, just like your elevator pitch.
Next, you can leverage social media platforms to reach a wider audience. Here, the focus should be on choosing the right channels for your specific business. For example, if you’re a new Spotify contender aimed at Gen Z, you’ll probably have a better chance of reaching your target through TikTok or Instagram over other platforms like LinkedIn.
A blog can also be an effective way to establish your startup as an industry thought leader and showcase your expertise. It allows you to share informative and engaging content that emphasises your startup’s unique selling points. It also provides value to your audience with “no strings attached”.
Take Sparktoro as an example here, they focus on helping companies with their market and audience research. But, if you head over to their blog, you’ll find a myriad of valuable resources targeted at entrepreneurs on everything from marketing to hiring to how to speak at a conference successfully.
This has resulted in a massive online following. Their CEO, Rand Fishkin, has over 136,000 followers on LinkedIn & the SparkToro newsletter has over 40,000 readers. Now, Rand had already garnered a following through his work with Moz, so you may not see the same results right away. But consistency and relevance will get you there if you persevere.
Whichever channels you choose to use, it’s crucial that you monitor and measure the results. It’s the best way to know if the channels you’re using are actually working, and allows you to make adjustments as needed. For this, analytics tools are great, but self-reported attribution is better.
Step #5: Continuously Refine & Evolve Your Unique Value Proposition
Keeping your value proposition relevant and compelling is essential for maintaining your startup’s appeal and staying competitive in the market.
Let’s take a look at Amazon as a tangible example of this.
Founded in 1994 by Jeff Bezos, it began as an online bookstore and has since grown into one of the world’s largest e-commerce platforms.
Over the years, Amazon has evolved and expanded its value proposition to stay competitive and cater to a changing market landscape. Here are some key aspects of Amazon’s value proposition evolution:
- Expanding product categories: Amazon initially focused on books but quickly expanded to sell a wide variety of products, including electronics, clothing, toys, and more. This diversification helped Amazon become a one-stop shop for customers, making online shopping more convenient.
- Amazon Prime: Launched in 2005, Amazon Prime offered customers fast, free shipping for an annual fee. This service enhanced customer loyalty and increased the frequency of purchases. Prime has since evolved to include additional benefits such as video streaming, music streaming, and access to exclusive deals.
- Amazon Marketplace: The introduction of the Marketplace allowed third-party sellers to list their products on Amazon’s platform, increasing the range of products available to customers. This expansion also allowed Amazon to capture additional revenue from commission fees and fulfilment services.
- Amazon Web Services (AWS): Launched in 2006, AWS is a cloud computing platform that provides businesses with various services such as storage, computing power, and databases. This pivot diversified Amazon’s revenue streams and positioned the company as a major player in the technology industry.
- Amazon devices and voice assistant: Amazon ventured into consumer electronics with products like the Kindle e-reader, Fire tablets, and Echo smart speakers, which featured the voice assistant, Alexa. These products not only generated additional revenue but also further integrated Amazon services into customers’ lives.
- Acquisition of Whole Foods: In 2017, Amazon acquired Whole Foods, a high-end grocery chain. This move allowed Amazon to enter the brick-and-mortar retail space and expand its grocery delivery services, while simultaneously appealing to a more affluent customer base.
- Amazon Fresh: Amazon Fresh is an online grocery delivery service that has continued to grow and expand, offering customers convenience and time savings. This service further solidifies Amazon’s presence in the grocery sector.
- Expansion into international markets: Over time, Amazon has expanded its operations globally, reaching customers in various regions and tailoring its offerings to suit local needs.
Staying relevant to your customers is about understanding where you stand in the market, and adapting to that market’s circumstances. That changes your value proposition as you ride different waves that your marker presents.
And Amazon has done a stunning job of this. The company has diversified its product and service offerings, focused on customer convenience, expanded its presence globally, and entered new markets to stay competitive and relevant in a constantly changing business landscape.
They’ve gone from an online bookstore to controlling the whole value chain from start to finish.
To ensure your unique value proposition remains up-to-date and resonates with your target audience, consider the following steps:
Monitor Market Trends & Customer Needs
Stay informed about industry trends, emerging technologies, and shifting customer preferences. By keeping a finger on the pulse of the market, you can identify new opportunities and challenges that may impact your value proposition. Adjust your message accordingly to ensure it remains relevant and in tune with the evolving needs of your target customers.
Collect & Analyse Customer Feedback
Actively gather feedback from your customers to understand their experiences, needs, and expectations. Use surveys, interviews, or focus groups to collect qualitative and quantitative data. Analyze this information to identify patterns and trends, which can provide valuable insights into potential areas of improvement for your value proposition.
Test & Iterate Your Message
Continuously test your value proposition with your target audience to determine its effectiveness and resonance. Experiment with different messaging approaches, focusing on various aspects of your offering, and assess the results. Use this feedback to iterate and refine your message, ensuring it remains compelling and aligned with your audience’s needs.
Update Your Marketing Materials & Communication Channels
As you refine your value proposition, ensure that your marketing materials and communication channels are updated accordingly. This includes your website, social media, presentations, and other collateral. Consistency in messaging across all channels will help reinforce your value proposition and build a cohesive brand image.
Engage with Partners & Mentors
Maintain open communication with industry partners, mentors, and advisors to gain insights and feedback on your value proposition. These individuals can offer valuable perspectives and advice, helping you identify potential blind spots or opportunities for growth.
Track Your Competitors
Keep an eye on your competitors and their value propositions. Monitor their messaging, marketing strategies, and product or service offerings. By staying informed about your competition, you can identify potential areas of differentiation or improvement for your own value proposition.
By continuously refining your message, you can ensure that your value proposition remains relevant, compelling, and aligned with your target market’s needs. Regularly reviewing and updating your message will help you stay competitive, adapt to changing market conditions, and drive long-term success for your startup.
Step #6: Be Consistent
Finally, you need to be consistent when sharing your value proposition. Whether it’s on your website, in person, on social media, etc.
Not only does consistency in your message build trust and credibility, but it also reinforces brand identity, avoids confusion, and improves engagement with stakeholders. It will also make your startup more recognisable and memorable to potential stakeholders.
Effectively communicating your startup’s value proposition is a key factor in determining its success and growth. To accomplish this, it is essential to follow a strategic approach that combines multiple elements, ensuring that your message is clear, compelling, and tailored to your target audience.
By following these guidelines and taking a holistic approach to communicating your startup’s value proposition, you can create a powerful message that resonates with your target audience. This will not only help you attract customers and secure investments but also differentiate your startup from competitors and drive long-term success.