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Brand Promise vs. Value Proposition

Working as a brand strategist has quite a few blessings. One thing is you’re always learning. Branding never fails to throw up some conundrum or other that requires you to seek a new answer. For instance, I’ve always thought of value propositions as variable, changeable over time as business circumstances may dictate. But many colleagues – and clients – insist that the value proposition should be a plank in the brand platform. It should be baked into the brand’s immutable DNA, just like the brand promise. Some even equate the two. Luckily, another blessing from branding is you get to meet many accomplished and fascinating people. One such is Barry Horwitz who publishes a really terrific monthly newsletter, The Strategy Game. That’s where I read his eye-opening article on value propositions. Barry specializes in growing organizations in strategic and sustainable ways. During his career at Boston Consulting Group, he worked extensively with Fortune 500 companies. Since then, he’s co-founded and led a venture-backed Internet company, he’s built successful new divisions within larger organizations, and he consults with mature businesses, startups and nonprofits alike. I thought his would be the perfect mind to help settle the brand promise/value proposition issue. When we Zoomed recently, I asked him about it.

bRandtalk
Barry, is there a difference between a brand promise and a value proposition? How do you see it?

Barry Horwitz
There is definitely a difference between a brand promise and a value proposition, Kevin. I view the brand promise as somewhat of an umbrella that sets high-level expectations and perceptions for anything offered by a given brand. A value proposition, on the other hand, is more specific to a product or offering from that brand.

For example, think about a high-end automotive brand like Porsche. Their brand promise emphasizes high quality, with a focus on sportiness and high-performance driving. There is an image that Porsche owners seek from owning a Porsche.

However, Porsche makes a range of vehicles. Let’s consider the Cayenne, an SUV model and compare it to the 911, one of their sports car models. I think it’s clear that the value propositions for those two vehicles are very different. Both of them fit the general brand promise – though in different ways. The Cayenne’s value proposition is more about practicality – having space for people or personal gear, and all-wheel-drive for access on rougher roads – while still offering the image of the brand and a high-performance driving experience. You wouldn’t say that practicality is part of the value proposition for the 911 – it only seats two and holds very little stuff – but it is a very high-performance driving experience.

Another example to consider is a brand like Uber. They are what’s known as a two-sided network, and so they have to offer a very different type of value proposition to each of their two sides. One for riders, that revolves around offering a ride quickly and easily, tap a button, get a ride with no hassle and no need to exchange cash. The other of course is for drivers, to convince people that they can make money by driving for Uber. These are two very different constituents, and yet both focused on the Uber brand promise of convenience, affordability, and reliability.

When a brand expands their offerings – for example when Uber added meal delivery through UberEats – well, the value proposition for that offering is clearly differs from one aimed at people looking for a ride somewhere. But that value proposition and offering can succeed if it meets the general Uber brand promise.

bRandtalk
I get that value propositions might vary for different kinds of customers. For instance, one airline brand may have different offers for economy seating and for first class. But the Uber story is interesting because it illustrates the different value propositions a brand may need to attract different constituencies. Can you speak a little more about that?

Barry Horwitz
There are many examples where companies have to consider different value propositions for different constituencies.

One example is how companies need to present a different value proposition for their employees as compared to their customers. Think of Costco. Many don’t know this, but they’re committed to offering their store employees higher pay than any comparable retail chain. They provide solid benefits as well and, as a result, their employees stay with them longer, know the business better, and thus can also offer better customer service. When shoppers think about Costco, they don’t think about those attributes at all. The value proposition for customers is about having a good selection of high-quality products at great prices.

Most nonprofits have significantly different constituents as, in many cases, the people who pay for their services are not the same as the people who receive their services. Even in the case of performing arts organizations, for example, the value proposition for patrons and donors are quite different. The value proposition for patrons relates to enjoying a fulfilling, meaningful and entertaining experience. For donors, the value proposition is about being recognized as a supporter of meaningful experiences and contributors to the betterment of society. And, often, the ability to attend prestigious gatherings with other donors.

bRandtalk
But, to be clear, even though a single enterprise may offer multiple value propositions, it’s still important that they all are perceived to be authentic to the one brand?

Barry Horwitz
Absolutely. In fact, the brand promise is a critical thing for companies to consider when they think about the value propositions for their various offerings. If the Porsche SUV was not designed for great performance, significantly better than, say, a Ford or Chrysler SUV, it would not succeed. Not only that, adding a low-performance SUV would certainly damage the overall Porsche brand. In that way, a clear brand promise provides a form of “guard rails” that define where a brand can and cannot go; what value propositions fit the brand promise… or not.

bRandtalk
Among many other things, Barry, you develop competitive value propositions for your clients. When do they need that kind of help? Why would an organization seek you out?

Barry Horwitz
There are several situations that bring people my way. When the environment their organization operates within is changing significantly, for example, this often triggers strategy questions. Environmental changes can include issues like the introduction of new technology or entry of a new competitor, or as in the case of my health & human services clients, anticipated but not-yet-clear changes like the move towards managed care from fee-for-service payment models.

Sometimes organizations seek me out when things they are doing stop working. In the case of startups for example, sometimes they start off growing rapidly but then hit a speed bump. Maybe they have attracted several early adopters but aren’t connecting with or attracting the broader audience they need to succeed. These situations tend to require a strategic look at the organization and its market to figure out how to succeed.

bRandtalk
Barry, this has been great. Thanks so much for clarifying how value propositions relate to brand promises. It’s been bugging me for a long time.

Barry Horwitz
Thank you for inviting me here, Kevin. I’ve enjoyed our conversation.

So I hold to my belief that the value proposition does not qualify as a major plank in the brand platform. But I’ve now learned that it should indeed be addressed there in some way. Perhaps it’s articulated in full as a kind of “sub-plank” to the brand promise. More likely, the concept should just be defined there, and then be referred to a separate (set of) document(s) where the value proposition(s) can be more readily updated. But, if only to provide clarification and get everybody in an organization thinking about these tools in the same way, both the brand promise and the value proposition have their place in the brand platform – just not the same kind of place.

You learn something every day. And that’s a blessing.

Get your free subscription to Barry’s excellent monthly newsletter: The Strategy Game.
Learn more about Horwitz & Company.

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