What is a Value Proposition explained

What is a Value Proposition? Why is it Important & a Few Examples


It’s already 2021 and many businesses didn’t make it through the pandemic. It is a well-known fact that the problems faced were many and a lot of big & small businesses struggled their way through the pandemic. Though, in my opinion, many organizations shifted their focus with fresh value propositions, which helped them sustain 2020. So, why not draw some light on the topic and learn about what is a value proposition, its importance, and its impact.

What is a Value Proposition?

In a nutshell, a value proposition is generally a one-line summary of how your product or service benefits your customers. And while many founders, marketers, and managers find this subject a bit confusing, it’s mostly the answer to “What do you do as a business”.

Usually, the value proposition is routed to the company’s target customers. A perfect proposition must quickly transmit the values to potential customers without the need for further explanation. Do note that each such statement must be unique, as it will help you to communicate the differentiation points of your company to the target customers.

Also, do note that value propositions can be used differently for different scenarios. For eg, it could be different when you are promoting a Christmas deal and completely fresh when your summer sale starts. But broadly, it’ll carry the same message subconsciously to your target audience.

In this article, we’ll shortly look into various value proposition examples to get a better hold of the subject. First, let’s clarify value proposition meaning as its one of the most confusing terms used in brand building,

A value proposition is not:

  1. A catchphrase: Slogans, taglines or catchphrases are not value propositions, but many brands try to impose the two. To state simply, a slogan or tagline is “a small group of words that are combined in a special way to make a product or service look more attractive/appealing.”
  2. An incentive: As an ‘incentive’ or ‘positive motivational influence’ designed to sort of bribe a visitor to act right away in favor of the respective product or service being offered. These must not be confused with value propositions, as end result might harm your brand image and end up decreasing your market influence.
  3. NOT a positioning statement: But a value proposition helps me position my product or service, right? Well, partially, YES! But if you just look at it on a deeper level, a positioning statement is an expression of how a given product, service, or brand fills a particular market need that a potential competitor doesn’t. On the contrary, a value proposition simply tells what service or product a company is offering. If you see from a broad perspective, the positioning statement is a subset of a value proposition, but it’s not the same thing.

Importance of a Value Proposition

So, now as you know what is a value proposition, you must also understand the importance of it. The value proposition is a powerful tool to promote sales and build a customer base. Additionally, a perfectly executed value proposition can promote a company’s marketing strategies. And as soon as your target audience arrives on your website, your value proposition should tell them everything you offer quickly, while you have their attention.

Lastly, an effective value proposition clearly articulates why a prospective customer should buy from your company instead of a competitor.

importance of value proposition in business

Benefits of a Good Value Proposition

1. Improves customer engagement: A powerful value proposition helps your customers truly understand the value of your company’s products and services. This increased understanding further promotes product engagement among the target audience.

2. Makes product understanding easier & effective: Most customers already know what they’re looking for when they research online. So, if it doesn’t serve clarity to your target audience, they might hop off to look for it elsewhere.

3. Attracts the right prospects: A company’s value proposition targets your company’s ideal customer and explains why your solution is the best option.

4. Provides clarity of messaging: A strong value proposition makes it immediately clear to your customers what you offer. Moreover, it also makes sure to communicate your message clearly on all the main entry pages.

How to Create a Value Proposition

Now, it’s time to create a value proposition. Knowing the fact that if you do it perfectly, it can boost your sales and increase your brand value too, let’s uncover these value proposition tips,

1. Know your customers and what you offer!

Before picking up the pen and starting the brainstorming process, analyze your product-market fit. Think about what is your product offering and what your ideal customers want from the products/services which you offer. Ask yourself, Do you have a USP that is needed by the masses? Do you offer service/product at least 25% better than your competition? Why your target audience should choose you as a buyout?

2. Understand your costs and benefits

Identify the benefits you deliver via your products or services, along with the costs incurred to provide them. It is important to do this because the value to your customers is essentially the difference between the benefits and costs covered.

how to create a compelling value proposition

3. What differentiates you from your competitors

Let’s face it, you probably have competitors offering similar products or services and carrying a major share of the market. If you already have an idea of your differentiating factors, I’d still recommend you to spend some time doing some competitor research.

4. Be clear

Don’t forget that an effective value proposition always serves clarity and gets rid of the customer’s confusion. Your target customers should be able to quickly grasp the message you want to convey and it should not exceed two or three sentences at par.

Some Value Proposition Examples


“Learn a language for free. Forever.”

value proposition examples

This value proposition sets Duolingo apart from other companies that provide language instruction with a fee. Since they promise unlimited free lessons.

2. Digit

“Save Money Without Thinking About It”

example for value proposition

Digit’s value proposition, offering hands-off savings. The key differentiator of Digit from other savings apps is that the process is entirely automated and is well portrayed in their statement above.

3. LastPass

“Simplify your life. LastPass remembers all your passwords, so you don’t have to.”

how to write a value proposition

The message focuses on the clear benefit of simplicity and makes the customer’s life easier. Also, do note that it is specific about what the company does, and how its service benefits its customers, both of which are important components of an effective value proposition.


Hopefully, this post helped you learn about value proposition with all its impact and importance. I believe the value proposition examples have given you some ideas of how you can improve or clarify this concept for your business. Remember, you don’t need an immense marketing or design budget to put what makes your business the best front-and-center in your messaging — just a little focus and one valuable statement are enough!

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