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A "value proposition" is the reason that your customers buy from you rather than somebody else. According to Michael Treacy, co-author of the bestseller, The Discipline of Market Leaders," there are four basic value propositions, each with its own advantages and disadvantages. Here they are:
1. Our prices are the lowest.
2. Our product is uniquely better.
3. We make things easier for you.
4. We take ownership of customer results.
my vote with both young samad malik, and much experienced TAIB.
1. Our prices are the lowest.
2. Our product is uniquely better.
3. We make things easier for you.
4. We take ownership of customer results.
Agree with Mr. Abdul Samad Nadeem
The customer value proposition is the way your customer looks at you, your company and your offerings, and whether they have the "value for money" (also as seen by the customer) to justify buying these offerings (products/services) from you and your company specifically and not from the others.
To explain it further, there is something called "unique business value" (UBV) that should be associated with you, your company and your offerings, and this UBV should be (1) tangible (2) quantifiable (3) measurable (TQM) to support your differentiation in the marketplace.
Last point, what customer sees real value - that works for you and not the others - depends on the nature of the product/service, its intended use, its importance/criticality, any risks/liabilities associated with the use of these products/services, the expected investment (cost) .. direct and indirect, visible or hidden, and the expected return on investment in tems of business value to the customer, and other considerations
Hence going for the lowest price is not always a good customer value proposition, although it plays a vital part in the buying decision of many customers in many sectors. I personally like the total cost of ownership (TCO) over the estimate lifetime of the product/service and its expected return on investment (ROI) as better financial decision factor, and there are the other consideerations of course that I mentioned earlier !!
I agree100%
with Mr. Abdul samad nadeem malik
+
excellent answer
Good Day!!!
Customer Value Proposition is the description of the experiences a customer will realize upon purchase and the use of the product.
CVP can be classified into3 types:
1- All benefits (Offering highest quality with cheapest price)
2- Favourable points of difference ( making buying decisions easier for customers)
3- Reasoning focus ( taking ownership of customer feedback)
A successful company is one that has found a way to create value for customers—that is, a way to help customers get an important job done. “Job” here stands for a fundamental problem in a given situation that needs a solution. Once we understand the job and all its dimensions, including the full process for how to get it done, we can design the offering.
The more important the job is to the customer, the lower the level of customer satisfaction with current options for getting the job done, and the better your solution is than existing alternatives at getting the job done (and, of course, the lower the price), the greater the CVP. Opportunities for creating a CVP are at their most potent when alternative products and services have not been designed with the real job in mind and you can design an offering that gets that job—and only that job—done perfectly.
Types of CVP
1. All Benefits - Most managers when asked to construct a customer value proposition, simply list all the benefits they believe that their offering might deliver to target customers. The more they can think of the better. This approach requires the least knowledge about customers and competitors and, thus, results in a weaker marketplace effort.
2. Favorable Points of Difference - The second type of value proposition explicitly recognizes that the customer has alternatives and focuses on how to differentiate one product or service from another. Knowing that an element of an offering is a point of difference relative to the next best alternative does not, however, convey the value of this difference to target customers. A product or service may have several points of difference, complicating the customer's understanding of which ones deliver the greatest value. Without a detailed understanding of customer's requirements and preferences, and what it is worth to fulfill them, suppliers may stress points of difference that deliver relatively little value to the target customer.
3. Resonating Focus - The favorable points of difference value proposition is preferable to an all benefits proposition for companies crafting a customer value proposition. The resonating focus value proposition should be the gold standard. This approach acknowledges that the managers who make purchase decisions have major, ever-increasing levels of responsibility and often are pressed for time. They want to do business with suppliers that fully grasp critical issues in their business and deliver a customer value proposition that's simple yet powerfully captivating. Suppliers can provide a customer value proposition by making their offerings superior on the few attributes that are most important to target customers in demonstrating and documenting the value of this superior performance, and communicating it in a way that conveys a sophisticated understanding of the customer's business priorities.
I agree10% with Ms Saria
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