Today’s article is focused on your value proposition.  Does your value proposition tell a story that compels your customers to act by answering the key question, “Why change?”


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If you’re an executive reading this, you might be thinking that you have a clear value proposition. If asked, you could explain it in under 30 seconds. The next step is to stress test the value proposition.   


First, we begin with defining a value proposition.  A Value Proposition is defined as: A business or marketing statement that summarizes why a consumer should buy or use your product or service. 


There is a key difference between the value proposition and a positioning statement. The value proposition is the value your solution brings to your customers.  A positioning statement is how you position your company against your competitors. Why us vs. them? 


Who owns the creation and curation of this? Typically, product marketing is the owner. Product marketing should be working with the product management team to understand what problems the product solves, and therefore, the value it brings to the customers. 


Most executives already have a value proposition.  You may be thinking you have a clear value proposition. This may be true, but what if that clarity stops with you?   


Here’s a test you can perform to see how well your value proposition is ingrained in your company. As you’re walking the halls, ask a few employees to tell you what the value proposition of your company is. Ask headquarters staff from various departments. Marketing, product, sales, HR, operations, etc. and see what they say.  Then ask people in the field representing your company first hand with customers.  This includes inside sales, customer success, customer services, support, and sales.  You may be surprised to find that people struggle to clearly articulate the value proposition. 


The inability to articulate the value propositioned is called message distortion.  This is the dilution of a message like value proposition as it moves down the hierarchy of your organization. While the executive team may have a sense of what the value proposition is, by the time it reaches people like sales reps, it has become completely distorted and convoluted. 


If your sales force isn’t sure of the value you offer your customers, it makes reaching your number virtually impossible. Even if you have a value proposition, if nobody knows how to articulate it, it might as well not exist. If you get this wrong, you will likely miss your number. 


This is a bold statement to make.  The reason the value proposition is so important is that buyers have changed the way they buy. With upwards of 70% of the customer buying process being done without a sales rep present, this means your customer is leveraging sources outside of your sales team to learn about what you do and how you can solve their problems.  These sources include online resources, peers, expert blogs, analyst reviews, etc. 


You should be able to clearly communicate why your solution brings value to the buyers engaging with your content.  Things to look for to determine if this is a problem:


  • Are you generating a lot of traffic on your site for a product, but not many leads? This could mean people are finding you while looking to solve a problem, but they bail out when your message doesn’t resonate with them.
  • Are you are not getting enough traffic compared to your competitors? This suggests you have issues with getting found to begin with. Do you have a clear understanding of what people are searching for to solve their problems? And is it connected to things like your SEO strategy so when they search, you show up in the results?
  • Are deals stalling in the early stages of the sales process? Poor conversions early in the stage progressive could indicate there is a gap in how the value of the product is communicated. 


Your product team has made a large investment to bring a new product to market.  In SBI’s annual research, we found that the typical B2B company spends 35% of revenues on product, marketing and sales expenses. Depending on your organization, you may spend a little more, or a little less in some or these areas. The point to emphasize here is it’s a big number. Something as simple as a value proposition can cost a company millions in failed product launches if it’s not clear. 


To illustrate this point, imagine a $1B company and the product team spent $30M building a new product. You estimated you could sell $30M of the new product this year to break even in year 1. If you miss that number, you have a sunk cost killing your revenue and profit goals.  


All of this points back to the core of the value proposition and the message to your customers. If your value proposition is off then customers either didn’t find you, or found you and weren’t interested. This cascades through the organization and ultimately ends up impacting everyone. 


Building the right value proposition starts with market research.  Start with broad markets and look for people who have common needs and problems. When you understand this, you can match an existing product or create valuable solutions that will serve those markets effectively. This is more successful than taking a single product and selling it to everyone the same way. 


What you’re likely to find here is people in different markets can use your solution differently.  The message you convey to them matters and needs to be tailored. For example, maybe a hospital has different problems than a bank. Your solution might fill the need for both of them, but in different ways. 


Once you’ve identified the markets you want to go after, you can then start to assign value to those customers at the account level. This is account segmentation, which is determining which accounts will generate the most revenue in the least amount of time. 


This is more than a potential spend exercise. It also involves account scoring, which is understanding what constitutes and “ideal” customer for your solutions. The tie-in to value prop here is understanding which customer types will value your solution the most. 


A rep can only focus on so many accounts. Imagine a rep has 400 accounts. He can’t cover them all, so which ones are the best ones to go after? Which ones give him or her the best chance to make their number? 


You now have a clear understanding which markets and customers in those markets will most value my product. I’ve gone from the entire universe to a set of markets and customers who will derive the most value and gives me the best chance to win. The next step is buyer segmentation. Buyer segmentation is understanding how buyers in your segments make purchase decisions. What’s important for marketing and sales to know about their buyers? 


If you’re an executive reading this, jump on a product demo with one of your reps and engineers this week. Chances are they spend almost no time understanding the buyer, their needs and tailoring their message to those items. That’s where your product is viewed as a commodity. You’re selling on a feature vs. value. When this happens, you’re inviting your competition to show up and marginalize your product and price.   


Who should own this part of Market Research?  Typically, product marketing owns this, with help from product management. They should be conducting customer research to understand things like objectives, obstacles, important to, measures of success, etc. of your buyers. This is how you start to understand value prop at the individual buyer level. 


This gets your sales team aligned and focused on value vs. product features. The reason by buyer personas are so important is that they don’t care about your product. They don’t. They care about themselves. They’re interested in solving their own problems, not buying your product. If the pain of staying the same is less than the pain of changing, you’ll never win. Knowing your buyers better than they know themselves is the key to knowing what value you can create here. 


The final step is user segmentation. This might be the most important thing to consider. If you don’t know how people use your product, and why they value it, you will have a hard time convincing buyers to make a purchase decision. More and more purchases are made via consensus and evaluation teams. If the people using your product say it adds no value to their work day, your product won’t sell. 


If you can’t create value for the user, it’s a non-starter. A story that illustrates this point. A company’s product team built a new scanner to sell to global logistics companies like FedEx, UPS and DHL. They skipped the step of conducting user research. When the reps went out to introduce the new scanner to their customers, they found out that it wasn’t compatible with the other systems the customers were using. Even if they wanted to, they couldn’t purchase it. The new product failed because it was of no value to the customers. 


A lack of comprehensive Market Research can cause a poor or missing value proposition. If you don’t have a strong value proposition, then sales are going to suffer.  This may include missing your new product goals and potentially missing your bonus targets is a high probability. 


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  • Your revenue goal is realistic
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Sales Revenue Growth



Scott Gruher

Orchestrates and designs the perfect project strategy, one engagement at a time, to ensure that every SBI client makes their number.

Scott joined SBI in 2010 with years of hands-on experience in sales leadership and enterprise selling. Since his arrival, he has helped dozens of organizations dramatically accelerate growth, from Fortune 10 organizations like Phillips 66 to fast-growing cloud service organizations like InfusionSoft. Scott specializes in cross-functional alignment. He helps leaders align around the growth goal and design the right processes to bring the strategy to life. His unique combination of real world experience and a pragmatic approach to problem solving have made him one of SBI’s most demanded resources.

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