Friday, 29 October 2010

Distilling the Essence of Your Value Proposition

This is a useful article about how entrepreneurs can communicate their value to others

Some highlights of the article:
  • Be clear:  Your listener needs to understand in simple, specific terms what the heck you are talking about.  Most entrepreneurs go too high and too abstract, or get way down in the weeds with technical jargon.  Or they mistakenly think that teasing the listener by being mysterious is somehow clever and enticing.  Instead, imagine how the Wall St. Journal or Forbes magazine might describe what you do to their readers.  You are best served by offering a simple declarative statement that enables the listener to have a clear image of what it is you do. 
  • Be credible:  Too many entrepreneurs destroy their credibility by using too many empty superlative adjectives and over-hyping their value proposition, or over-stating their potential (“We’re going to be the next Google ....”).  Maybe you are going to be bigger than Google, but saying that you are doesn’t make it so, nor does it help your credibility.  Instead, if there is something impressive you have already accomplished that enhances your credibility (“Steve Jobs has joined our Board,” or more realistically, “We’ve already signed three paying customers”), let us know.
  • Be compelling:  Your solution has to represent a dramatic improvement over the current state of the art, not just a nice incremental improvement.  And you have to be novel or clearly differentiated – something your listeners haven’t heard before.  You might be able to build a perfectly nice business if you have invented a better mousetrap, but if you really want the world to beat a path to your door, you need to offer a non-toxic technology that eliminates every single unwanted rodent in New York City.  The trick is to state what is compelling in terms that are clear and credible.  One of the best ways to do this is a simple metric:  “We can demonstrate a 10x improvement in price-performance, based on our initial customer results.”  If you have been clear about what you do, you probably don’t have to spew a bunch of market size and growth statistics; that should be obvious enough.  Your Wow does not come from the size of your market, but from the size of your advantage.  

    No comments: