Increasing the value in customer value propositions

What is the benefit of the benefit?

An effective value proposition clearly articulates the primary benefit or benefits that the business delivers to its customers; and these benefits are both differentiated from what competitors offer and genuinely valuable to customers.  Too often, doctor however, the latter criterion is not met because value propositions are articulated in company- rather than customer-centric language.  To avoid falling into this trap one question that marketers can ask is ‘What is the benefit of the benefit?’

This very simple question helps in two ways.  Firstly it helps ensure that the wording of the value proposition is meaningful to the target audience.  One of the problems with the ‘Brand Promise’ as a starting point for developing value propositions or designing customer experiences is that it is often cast in terms that motivate internal stakeholders (for example, the sales team) rather than in language that excites customers.

A classic example of this particularly genre is the use of the word ‘innovative’.   Innovative or some variant will appear in many statements of brand values.  It is viewed as positive for both customers, with what they are offered constantly being refreshed, and the company – the driver of superior revenue growth and profitability.

The problem with a value proposition that offers customers ‘innovative solutions’ is that it does not answer the ‘so what?’ question.  Being offered something new is not a benefit to customers in and of itself.  To be valuable it must reduce the price to the customer or reduce other costs the customer has; increase the customer’s productivity, increase convenience or increase the value of what they offer to their customers (in the case of B2B markets).  This is what the value proposition should focus on.  And asking: ‘what is the benefit of the benefit to the customer?’ helps the transition from language reflecting corporate pride to an articulation that communicates value from the customer’s perspective.

Secondly asking this question also stimulates creativity in finding additional ways to create value by facilitating what experts on cognitive processes call ‘leaping logical levels’.  This involves moving upwards from the specific to the general or abstract and then back down again.  Rising from the specific to the general involves asking ‘what is this [being/thing/concept] an example of?’ and descending from the general to the specific requires asking ‘what is an example of this?’

This is best understood using an everyday object or pet.  If we take a Black Labrador as an example, the process of abstraction would take us to Labrador Retriever, Retriever, dog, quadruped, animal, mammal and finally, living being (or something similar).  The outcome of the process of returning to the specific depends on which of these categorisations or levels is the starting point.  The higher or more general the level, the wider the range of possible answers there are to ‘what is an example of this?’ (And the less likely you are to end up at a Black Labrador again).

The same process applies to concepts as much as to physical things.  Indeed the process of lateral thinking is nothing more than moving up and across and down again – a structured approach to creativity which generates a range of alternative options.  And it also applies to benefits (an example of a concept).  And asking ‘what is the benefit of the benefit?’ is simply a more tailored version of the ‘what is this [benefit] an example of?’ question.

The 8 levers of value

If you continue the process of abstraction for business benefits you end up with the eight benefits outlined in Figure 1.

These can be further categorised as financial, functional or emotional.  The financial benefits are those that translate directly into a monetary benefit for the customer either through a low price, or reducing other costs the customer has (Productivity) or, in the case of B2B industries, enabling customers to sell either more to their customers or achieve a higher price (Margin Uplift).

The functional benefits include making life easier for the customer (Convenience), offering choice and flexibility; or high responsiveness, even being pro-active (Speed).  These also may provide a monetary gain, but one that is less directly attributable and quantifiable than with the financial benefits.

The emotional benefits involve making customers feel good about themselves or making them feel secure.  The former is often associated with prestige and uniqueness, but can be generated by enjoyable purchase process and the propositions meeting ethical considerations (among others).  In some respects security can be seen as reducing the risk of feeling bad – offering piece of mind, trust and confidence.  (Asymmetry in what delights and displeases us make these two more than just different sides of the same coin.)

Obviously no business can or should seek to excel in each of these dimensions and creating a value proposition is essentially a design challenge.  Designers, whatever their field, have a fixed set of components which they need to combine and trade-off.  Product designers need to consider shape, colour, texture, material, pattern and ornament.  Similarly, interior designers must work with space, light, colour, pattern, texture and focal point.  In the same vein, value proposition designers also have these eight benefits which they can deploy to deliver value to customers.

In practice, using these value elements can provide a starting point for understanding what is being offered currently, what competitors are offering and what else could be offered in each area.  Such an approach will identify both quick wins – how products, services and interactions with customers can be amended to make them more convenient for customers, for example – and strategic moves.  Continuing with convenience as an example, making it a key element of the value proposition when it is disregarded by competitors, can alter perceptions of value and generate an advantaged strategic position that is not easily mimicked.

For businesses seeking to increase the value in their value propositions, the starting point is understanding value from their customers’ perspective.  Keeping these eight value elements in mind will help them achieve that.

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About Jack Springman

I am a consultant with experience in business strategy and customer strategy development, customer management and customer service transformation.


  1. Michelle Romanica says:

    You raised an important point here, Jack. Taking that extra step beyond the traditional “features and benefits” thinking to figure out how that benefit will positively impact the customer is the differentiator. I really like the context you’ve laid out here to assist in taking things to that needed extra level.