The Value Proposition - How to Sell Your Vision and Ideas

As an executive, manager or employee working with innovation, you always have something to sell. In the end it is a product or a service, but during the development of your revenue-generator, you have to sell your vision to internal and external stakeholders. In two posts, we will look into how you will communicate that vision by:

• Developing a value proposition that can be adapted for various stakeholders and then

• Capturing the very essence of the value proposition in a brief elevator pitch that focuses on the recipients of the message. Check this post: The Elevator Pitch - How to Sell Your Vision and Ideas

Geoffrey Moore is a Silicon Valley-based consultant and author of the now-classic book Crossing The Chasm, which describes the issues new products or services face when they are being brought to market—and, more importantly, offers strategies on how to overcome these issues. Let’s look at some of his ideas.

The Value Proposition

In Crossing the Chasm, Moore uses the term “value proposition” as a way to describe what we choose from among what is presented to us for consideration, including choosing nothing at all if it does not improve our current situation. The value proposition presents ways we can use our time, energy, and resources in pursuit of our goals. Our task is to evaluate whether one value proposition is better than what we are already doing, or is best among other value propositions available. Knowing what constitutes a value proposition guides us in our evaluation of the various alternatives.

Moore describes six elements that are needed to communicate an effective value proposition. The elements are:

• For (target customer)
• Who are/wants/needs (statement of needs or opportunity or compelling reason to buy)
• The (product name) is a (product category)
• That (statement of key benefits)
• Unlike (primary competitive alternative)
• Our product (statement of primary differentiation)

Moore used the high-performance computing company Silicon Graphics’ early entry into Hollywood to create an example of what a value proposition might look like based on these six elements:

• For post-production film engineers
• who are dissatisfied with the limitations of traditional film editors
• our workstation is a digital film editor
• that lets you modify film images any way you choose.
• Unlike workstations from Sun, HP, or IBM,
• we have assembled all the interfaces needed for post-production film editing.

Moore suggests this approach because it allows you to convey all the important aspects without providing too much information. It also enables you to explain your product or service in a few sentences. The idea is that if you can convey your message to others in 60 seconds or less, they will remember the majority of the value proposition. Since word of mouth is one of the biggest forms of communication, this is extremely important. The value proposition created for this approach can also be used later when creating the elevator pitch.

Remember that a value proposition should focus on the gains you can provide your audience or customers. It is not about you and your reasons to sell something. Try also to keep it simple by focusing on a well-defined target group and their need. Also, focus on one key benefit, even though you can probably mention many, and focus on only one—or very few—competitors.

Most importantly, this statement must not be hype or something you just make up. It must be grounded in the real world. The statement has a lot of value for management purposes as it is extremely helpful in making sure we are all on the same page. Eventually, you will find this will get hyped for sales and marketing purposes, but I suggest you keep it as clean as possible for the earlier internal purposes.

While working on your value proposition you should try to start off with—or at least include—words such as “we help” as this will help you focus on your audience and their needs.

Now, let’s do a little exercise. Think of your offerings or important messages and ask yourself whether you are focusing on yourself or on the ones you want to influence. With your offerings or messages in mind, write the words “We help” on a sheet of paper and then try completing the sentence. Make several versions of it. Having done this, you can work further with Moore’s formula.

You have been given a short introduction to the value proposition. I hope you sense how strong a tool this can be and why it is important for executives, managers and employees to understand.

You should also check this post: The Elevator Pitch - How to Sell Your Vision and Ideas