Do you feel that you could honestly and confidently state what your value proposition is for your business? Prior to establishing your business, it is essential that you take the time to determine what your value proposition is if you would like your business to succeed. The following exercise will help you learn what a value proposition is and how you can write your own.

What is a Value Proposition?

According to Investopedia, a value proposition is “A business or marketing statement that summarizes why a consumer should buy a product or use a service. This statement should convince a potential consumer that one particular product or service will add more value or better solve a problem than other similar offerings.”

While this is only one of the many definitions available for what a value proposition is, all of the definitions available agree on two key points:

1. Definitions should be done from the customer’s perspective.

2. Value propositions can give your company the upper hand in the competitive

Why Do You Need a Value Proposition?

A value proposition assists you and your company to understand both the customers you are specifically targeting and the value that you can offer in the marketplace. If you and your clients both feel that you are receiving a mutually beneficial exchange, then you can expect long and established relationships with those clients.

The Customer’s Perspective.


The overall value of the product or service a customer receives from your company is linked to the quality of products and services you are able to provide them. The majority of customers feel that they are receiving a good value when the benefits of your goods or services outweigh their overall cost or inconvenience. Ultimately, it is your customers who will determine what value to give your business’s offering.

Because your customers will define the value of your company, you need to develop your value proposition around their desires. Once it has been developed, it is your job to explain the product or service you are offering while putting emphasis on the strengths of your company to create a competitive advantage.

Your value proposition should address each of the following components:

What can your company offer?

Who are your target customers?

Why should your customers purchase from you as opposed to other competitors in your market?

How will your product differ from the competition?

In order to get the most use out of your value proposition, the answers to all of the questions above should be clear, concise, and poignant.

Once you have addressed all of the questions discussed above and have a firm grasp on the concept of value propositions, you will be able to increase your perceived benefits, decrease the perceived sacrifices your customers will have to make, focus clearly on your resources that are greater than others in your market, and continue to tailor that what you have to offer is different from your competitors


To make this all stick better we’ve put together some great examples of other companie’s value propositions. Some of the companies we list below you may not recognize but you’ll be sure to know what service or product they offer just by reading their value proposition:


Freshbooks –


MailChimp –



PayPal (Business segment)-