Small and medium-sized B2B technology companies are not defining their value proposition statements in a manner that drives customer engagement and increases sales. They rely on their industry experience and are biased by their solution, often forcing a value proposition onto their prospects based on their solution’s capabilities.
Tech CEOs must work through a value proposition design process to remove their biases and keep the focus on the customer.
Tech CEOs fall into four common pitfalls.
1: Using an Inside-Out Approach
Starting with their solution is the most common way technology companies define their customer value proposition. After spending years developing the solution, they become enamoured and fail to consider their customers’ needs fully. They start to see the customer’s problems through the lens of their solution when they need to see their solution from the customer’s perspective.
For example, on the surface, automation technology that reduces edit errors is undoubtedly valuable. A value statement might be, “Our solution uses proprietary algorithms to reduce edit errors.”
The question becomes, who is this statement targeted toward, and can they make a buying decision? While ensuring that front-line users do not derail the sales process is essential, companies often hang their hats on these statements.
2: Mimicking Competitors
When your prospects bring up competitors, and you lose your first few deals to them, there will be pressure to align your solution against your competitors by mimicking their value proposition and product capabilities.
While you may gain comfort in being able to say, we have that too. Your prospects may struggle to understand why they should purchase your solution.
Try this. Take your value proposition or elevator pitch and replace your company/product name with your competitors. If the result sounds like your competitor’s value, your prospects will have difficulty understanding why you are the right solution.
3: Emphasize Feature and Benefits
Companies often use a feature-benefit statement as a value proposition statement. Tying features to customer benefits is important as the solution needs to make life better for your prospect. However, a feature-benefit statement is not necessarily the right way to communicate value.
During sales presentations, corporations focus closely on their product’s capabilities and fail to tie the product features back to what the prospect needs and how it relates to their buying decision.
4: Improper Use of Personas
A persona is a strawman for the person targeted during the sales process. Hubspot has a great article discussing personas and how to use them: Seven Persona Examples.
The critical parts for personas lie with descriptions of their needs, motivation, pain points and their journey through the buying process. It’s all interesting, but personas still feel artificial and carry additional baggage that confuses the issue: description, name, and demographics.
As a result, corporations often focus on the wrong things with their value proposition.
Conclusion
Tech CEOs need to be aware of the pitfalls with their approach to creating a value proposition and look for ways to focus on creating new and interesting value propositions. CEOs must find a unique place within the industry and continually educate the prospect on their differentiation.
Fortunately, your competitors are struggling with these pitfalls, and you can get ahead of them by reconsidering your approach to value proposition design.