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7 Steps to Better Startup Value Propositions

Marketing messages and value propositions are notoriously difficult to create for startups. Startup founders have a tendency to focus too much on features and not enough on the value those features deliver. They also often spend too much time talking about features that don’t really differentiate them from their competitors or are simply irrelevant for their target markets. When working on marketing messaging for startups, it’s often harder to get agreement on what NOT to say than it is to decide what should get talked about.

Here’s a method for getting to a simple set of value propositions that has worked for us:

1. List your target market segments. The more detail you can get around this the better – for example “Small Businesses” is not a segment, “Mid-sized law offices in North America” is. The segment should be well-defined with a clear need your solution addresses. For early-stage startups, you will generally only have 1 or at most 2 target segments. If you have more than that, you likely don’t have the resources to really go after them.

2. For each segment identify the primary buyer. For complex deals there will be multiple folks that influence a sale but for a simple value proposition exercise, it helps to start with the most important decision maker (you can come back and worry about messages for other buyers later). Again, this person should be well-defined which means you will likely have more than just general demographic data (i.e. people in their 20’s versus University students in Canada that spend more than $100 a year on games).

3. For each segment list the competitive alternatives. Often for startups these are not competitive products in a traditional sense but things like Word or Excel or cheap manual labour. Often the worst competitive alternative is the dreaded “do nothing”. Each segment might have different competitive alternatives.

4. List your key differentiated points of value. There are 2 key things here: “Points of Value” and “Differentiated”. Points of value are NOT features. Things on this list should look like “Gives network managers visibility to stop a virus before it spreads” or “Let’s you place a call to anyone without having to remember a phone number” or “Lets users create high quality videos they can share with their friends”. It should not say things like “provides layer 4 visibility”, or “includes an identity repository” or “HD support”. You are listing why customers care about the feature, not the feature itself or how it was implemented. The points of value also need to be clearly differentiated from the previously listed competitive alternatives. For example, if you think a key value point is that your solution is “very easy to use” but the competitive alternative is Word, you really don’t have a differentiator. If alternative solutions for your segments provide the same benefit (even if they do it in a different way), leave it off the list.

5. Rank the points of value against your target segments and buyers. Putting yourself in the customer’s shoes, rank the importance of that benefit to each of the segments as High, Medium or Low.

6. Pick the top 2 or 3 benefits and craft a value statement. Look at which ones ranked the highest for your segments, pick a couple and write messages around them. Be brutally honest at this step. Customers coming to your site won’t read past bullet point #3 and if your top 3 benefits don’t get the attention of your prospects, the next 5 won’t either. You can hit them with the longer list and the details later. What you are trying to get to is the essence of why people should be interested. You are moving customers from “Why should I spend 10 seconds thinking about this thing?” to “Tell me more.” Craft a value statement that describes the key couple of benefits that your product provides for your most interesting segments and leave the rest out.

7. Refine forever. The simultaneously fantastic and horrifying thing about messaging is that you are never done. Messages can always be improved. The more you interact with customers and see how your product is being used, the more you can refine (and sometimes completely re-write) your value statements. If you haven’t touched your messages in a couple months, I can guarantee you they need an update.




  1. It’s great to know I am not the only person who thinks most companies, let alone start-ups are really bad at developing value propositions. I like the simplicity of the seven steps you have laid out.

  2. thx for this, this is most useful. However, I think the product analysis should be done b4 identifying the value proposition


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