What’s Value proposition and why startups need to focus more on it?

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What’s Value proposition and why startups need to focus more on it?


 (Source: www.geekheal.com

Most startups in Nepal limit marketing only to their Facebook and Instagram pages, flooding their followers with information, which will probably get ignored. Startups need to stand out from the crowd and posting information on their ‘walls’ is not going to help every time. Marketing is a tactful art of communicating, and when communication is in question, startups need to realize that it needs to happen from both parties involved – you and your customer. A founding stone for a strong marketing plan is a well-constructed value proposition.


A value proposition is a positioning statement that clarifies why customers should buy your product or use your service. It describes how you solve existing problems in a unique way and how your way can benefit the customers. 


(Source: scowsoftware.com)

A value proposition must answers these questions:

Why should customers buy from you?

How is your product different?

How will customers benefit from your product? 

What products do you offer and to whom?


Let’s construct a simple hypothetical value proposition for a hypothetical noodle manufacturing company ‘Chau Chau’ by answering these questions:

“We believe in solving even the smallest of hunger (Why should customers buy from you?), for which Chau Chau comes in different flavours and exciting packages (How is your product different?). It is healthy and can be prepared under 5 minutes (How customers will benefit from your product?). We happen to make great masalas and great noodles in different varieties for anyone, anywhere (What products do you offer and for whom?).” 

It seems simple, doesn’t it? But it’s this simplicity that becomes complex when brought into action. A value proposition must be such that your target customers can understand and appreciate. It should be something that customers can reciprocate and communicate back to you. It’s about communicating with your customers without any words, pictures or graphics but only with the value your service provides. 

A well-constructed value proposition is the blueprint for any marketing plan and it definitely serves multiple purpose.


What’s your super-power 

For startups, constructing a value proposition is not an easy task.  Many startups are still in the dark about the value their businesses are providing or can provide and how they can stand differently from their competitors. The process of building a value proposition is a lengthy discovery about your own business. It’s about realizing where your true strengths lie and building your value around it.  Three decades back when Chaudhary Group (CG) entered the ‘ready to eat meals market’ with Wai Wai, it built its value around being among the first noodle companies which was tasty, easy to prepare and cheaper in comparison to foreign imports. Today, it is well known that Wai Wai is an integral product in the lives of many Nepali people and Wai Wai builds its values around it by polishing the human aspects touched by Wai Wai. (This can be understood better through this video https://www.youtube.com/watch?v=wWfp5OYA1BY

(Source: www.realclearscience.com


Who do you want to help with your super-power

Secondly, it answers to who our target customer is. If you’re thinking: “Hey, what kind of an entrepreneur doesn’t know his target customers?”, it does help to identify our customers and create a detailed profile on them on the basis of their wants, choices and behaviours, but the real value in making value propositions is to reflect these values in our work and connect with the target customers. When we develop a value proposition, we promise on delivering a certain value. The proposition serves as a reality-check: Are we delivering what we promised?


If you don’t have an iPhone, you don’t have an iPhone 

Ever wondered why iPhone is the first phone in the minds of many when the word ‘smartphone’ appears?  The only reason can be the way Apple has presented the iPhone to differentiate it in the minds of the customers. Almost every cell phone company in the world has got similar human resource, design skills and technology that Apple has. Without any doubt, they are as capable as Apple but what sets Apple apart? Apple doesn’t sell a phone with dual core processor, 8-megapixel camera, 16GB storage etc. etc.  They sell their value: their value is of a phone that captures your intimate and happy moments, that makes your digital experience undisruptive and a phone that stores your favourite music, important files and memorable pictures.  This strong differentiation is the result of a well-constructed value proposition. After all, “If you don’t have an iPhone, you don’t have an iPhone.”


(Source: www.lisaprincic.com

It’s for your own league 

The importance of value proposition for startups is the sense of direction it gives to the employees and to the business as whole. A considerable number of startups struggle and even fail because their employees are confused about the visions and missions of the company. When employees understand the product we are offering and why we are offering it then the workforce remains clear on their objectives and are highly motivated. 


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