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Unique Value Proposition

Unique Value Proposition vs Unique Selling Proposition: The #1 Answer

Unique Value Proposition and Unique Selling Proposition: These two terms come up a lot in business strategy and even in digital marketing, and people seem to use them interchangeably… but they’re wrong.

If you’re running a business, you will need both.
One guides your strategic direction, the other turns that direction into an appealing micro-idea for potential buyers.
Let’s enter the in-and-outs of these two pivotal concepts – and if you’re into video, remember you can also watch this instead of reading!

The UVP | Unique Value Proposition vs Unique Selling Proposition

The Unique Value Proposition is mostly internal. It is a statement that summarises, lo and behold, how your company produces value in the market. There are 14 ways to create value in any given market – at Sypnotic we call them Command Philosophies, and they are the drivers of your strategy. You can see these 14 ways as “types of company.”

If you want to dive deeper into this topic, we wrote an entire Tactical Guide on this topic. You can download for free it by clicking on this sentence. But to save you time, here’s an example: you can be a Value Player that offers great quality for the lowest possible price in the market, or a Premium Player that provides high-end products or services.

Your company can be an Innovator, meaning that you introduce new and creative solutions to your market, or you can be a Fast Follower, which is a type of company that leverages the work of innovators to introduce new offerings, often becoming also Value Player in the process.

Now, you can combine several Command Philosophies and there are plenty of variants, so it’s better if you we make this more tangible – let’s see the Unique Value Proposition of IKEA:

IKEA is low-price player and experience provider. It creates a better everyday life at home for many people around the world – providing functional and stylish home furnishings at very low prices with a high level of customer engagement, quality, and sustainability.

IKEA’s Value Proposition

As you can see, a Value Proposition isn’t just about the products or services you offer.
To have a Value Proposition that works, you need to find out what’s your competitive advantage. That will be the topic of another video, but for now know this – to find your competitive advantage you need to identify the capabilities, skills, and knowledge that makes your company unique. Once you have that clarity, you link those assets to two or three Command Philosophies, and you’ll have a Value Proposition.

The USP | Unique Value Proposition vs Unique Selling Proposition

Now, a Unique Value Proposition isn’t enough. There’s a reason you don’t find that long IKEA Value Proposition in their every day marketing – and that reason is that their customers don’t care of how IKEA generates value. Their customers care about how IKEA makes their life easier, and here’s where the Selling Proposition comes into play.

A Unique Selling Proposition is a statement about how you make a difference in the life of your customers.
Unlike the Value Proposition, your Unique Selling Proposition is way easier to understand and much shorter, and it isn’t just a statement. 
It is an actual formula that you can create after you have a Value Proposition. To craft the Unique Selling Proposition formula, you need two elements:

End result you provide your customer + the benefits of your differentiator

The Selling Proposition Formula

In the case of IKEA their Selling Proposition looks like this:

Affordable and stylish home furnishings that easy to transport, fun to buy at the store and that anyone can mount at home

IKEA’s Selling Proposition

This might seem trivial to you because IKEA is such a well-known brand, but that simple statement summarises one of their competitive advantages: Not only their commitment to having the Value Player command philosophy, but their constant effort to make things easy to mount. To improve their customers’ experience from purchase to mounting.

And if you’ve ever mounted furniture from any store other than IKEA, you know how hard some of those instruction manuals can be, especially if you compare to how masterfully IKEA designs each manual to be understandable and easy to follow.

In A Nutshell | Unique Value Proposition vs Unique Selling Proposition

So, let’s summarize.
Your Unique Value Proposition is an internal document.
A strategy asset that explains how you produce value in the market.
It keeps you on track – because if you’re a Value Player you won’t start suddenly selling luxury services like Premium Players do.
To build your Unique Value Proposition you need two ingredients: A full grasp of what are the competitive advantages of your company, and two or three of the 14 Command Philosophies that guide a company. I’ll be making more videos about that in the future, so don’t forget to subscribe.

Instead, your Unique Selling Proposition is a formula that expresses how the value you generate impacts your customers. It can be public, it should be short, and to find it you only need to fill out a formula: The end result you provide to your customers + the benefit of your differentiator or competitive advantage.

IP.S.: If you liked this article, you might like our article

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