By Gerry Spitzner
Getting your value proposition right is critical to your business model. You can have the best features, perfectly executed business operations, the right price, etc., but no one will ever know if they don’t get past your high-level value proposition.
Your value proposition is the crunch point at the intersection between your business strategy and your brand strategy. It’s a promise of value to be delivered and a customer’s belief that value will be experienced. It’s the primary reason a customer should buy from you (not someone else), and explains how they will benefit from doing so.
When you’re crafting your value proposition, find a way to express the organization’s impact on the lives of your customers, clients, patients—whomever you’re trying to serve. Focus on how they will actually apply the benefits your pharmacy business or patient service promises.
Unlike a product, a service can’t be experienced before purchase. Make them feel it. The way to make that connection starts with a clear compelling statement that answers the customer’s questions: “What’s in it for me?”, “Why should I buy this product or service or do business with this pharmacy vs. that one?” and “Why should I do anything at all.”
An effective value proposition is one that real people can understand in a few seconds. It needs to be in the customer’s language. Avoid hype (terms like “never seen before”), superlatives (“best”) and business jargon (“value-added interactions”). It’s important to avoid industry or advertising jargon that sounds like you’re manipulating the customer. Rather, they should feel inspired to act and confident that the service will deliver what’s promised.
What exactly is value, and why is it important now? Without a strong value proposition, it’s much harder to sell your patient services in today’s economy. As Warren Buffet notes, “Price is what you pay; value is what you get.”
Another definition: value is a function of the bundle of perceived benefits offered at a given price. And perception is always the reality in the eyes and ears of the beholder. Perception means different things to different people. So, in order to engage your customer or patient in a service, there must be some form of interest or perceived value on their part.
The customer’s perception is your reality. Articulate your competitive differentiation because if you can offer something in a different way—a way that’s in demand—your price can be higher and customers will perceive your value as higher. Think Starbucks.
Value proposition: it’s not all about you? A value proposition is often confused with an elevator speech or a unique selling proposition (USP). It’s essential to understand the difference between these terms, because they impact customers very differently.
A USP, or elevator pitch, is a statement about what makes you different from others. Its primary value is to create competitive differentiation. A USP is often used in marketing materials or in talking with customers who are ready to buy. It’s usually all about you.
A value proposition is a clear statement of the tangible results a customer gets from using your patient services. It’s outcome-focused and stresses the value of your offering. It’s all about them.
Your value proposition should clearly answer the question in your customer’s mind: “Why should I buy from you?” Your business vision should be the basis of your unique value proposition that states why your patient service is different, that it will do what you say it will do, and that it is worth paying for.
Gerry Spitzner is principal business consultant at business management consultancy pharmacySOS.ca.
This article originally appeared in the October issue of Pharmacy Practice+Business.