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The Differing Definitions of ‘Value Proposition’

In the sidebar of this week’s newsletter, there is an article entitled, “The Value Proposition Defined”. Perhaps the author felt compelled to write such an article because, like me, he’s becoming perplexed. No one seems to be able to agree on what a value proposition is anymore. In my view, they are often conflated with the brand promise. I don’t want to disparage the article. It’s well written and I take the author’s point. But, to my mind, he substitutes “value proposition” for “positioning tagline”. Again, I understand where he’s coming from but it doesn’t match up with my experience. To me, a brand promise, often expressed through a positioning tagline, has to be a rock-solid constant. It is a north star that guides the business in everything it does. It is a beacon of authenticity that customers trust. I’ve always seen value propositions as mutable, usually a retail offer that changes with market conditions. Let’s look at one of the author’s examples to see what I mean.

The article has several great examples of what author, David Stewart, calls value propositions. Let’s pick the first one, BMW – The Ultimate Driving Machine. All the examples Stewart selected are tremendous but I’m picking BMW because it’s a brand I admire.The Ultimate Driving Machine is an admirable line and has stood the test of time. Also, in my forthcoming ebook, The New CEO’s Branding Handbook (watch for it soon), I use this classic as an example of how a tremendous positioning tagline can mitigate, and even improve, a less-than-stellar brand name.

So here’s Stewart’s way to define a value proposition:

BMW – The Ultimate Driving Machine

But if we run it through Jim Stengel’s formula, as described in his excellent book, Grow, we might come up with what he calls an ideals statement like:

BMW exists to transport and transcend the driving experience.

If we can accept Stewart’s definition of a value proposition, we could just as easily accept a Stengel-like ideals statement as one. As I said, to me Stewart’s definition reads more like a positioning tagline. And Stengel’s ideals statements seem like purpose statements to me. After pondering this, I went to www.bmwusa.com to see what they were communicating as a value proposition. On the home page, in large type, the first thing I read was:

SUMMER ON – The BMW Summer Sales Event offers 0.9% APR and a credit of up to $3,000 on select BMW models now through August 31st.

Now, to me, that’s a real value proposition! Mind you, I didn’t go to the local BMW dealer’s site. This is on the national BMW site. This is a branding tactic. (For those of you who are considering a new BMW, I’m sorry I didn’t get this info to you last week. Because it really is – was – quite a good value.) This is the kind of offer that I’ve always thought of as a value proposition. It’s below-market financing in August; it will be something else in September. As I said, inconstant, not permanent. The Ultimate Driving Machine has been solid, the cornerstone of BMW’s marketing for years, if not decades. That’s why I can’t see it as a value proposition.

Confusion over what a value proposition actually is has all sorts of deleterious effects. Recently, I had the opportunity to peruse the graphic and editorial standards of a 30-year-old, billion-dollar company. I went to the page entitled, Our Value Proposition. I read through two paragraphs and five bullet points. Thinking I missed something, I read it again – two more times. I still have no idea what their value proposition is.

I’m not writing this to pick a fight or to say that I’m right and everybody else is wrong. Mr. Stewart sir, I respect you and, if this definition works for you, more power to you. And I hope I’m not so rigid that I can’t be persuaded to see things another’s way. But, for now at least, I’m sticking to my own definitions.

I’m merely pointing out that this is another example where we branding professionals are confusing our market. We can’t agree on a glossary of terms. We constantly preach the importance of brand purpose, brand promise, mission, positioning, strategy and value proposition. But none of us seem to define those terms in the same way. Is it any wonder that the business leaders we hope to convince, who are all about measuring outcomes, view us with suspicion?

Does all this word-smithing even matter? In a way, no. What matters most is getting the brand relationship right. Making sure customers and clients get the emotional benefit they crave no matter how we define the planks in the brand platform. People like David Stewart and me can prattle on like officious eggheads and the markets care not one whit. But if we ever hope to stop confusing business leaders and getting their wholehearted acceptance of the importance of branding, it would help if we could all get on the same page.

How can this state of affairs be improved? In my fantasy world, I’d advocate for some sort of international commission to be formed to nail down these definitions once and for all. But ours is a creative profession. We break laws. You know once the Moses of branding brought down the tablets from on high, we’d immediately begin justifying exceptions to the rules. In short order, we’d be back in the same spot we’re in now. Better to just live with our current state of confusion. That’s the nature of creativity, isn’t it? As long as we all agree that we can’t agree.

BEST BRANDING READS – WEEK OF AUGUST 31, 2020

The Value Proposition Defined
Great examples of positioning slogans here.

How Purpose Leads To Profit
Yes, cold, heartless corporations really can do the right thing.

Pandemic-Induced ‘Survival of the Fittest’ Test for College Brands
When schools lose their value propositions, they better hope they have a strong brand promise.

How Thought Leadership Drives Growth
Turns out thought leadership is measurable and influences brand rankings and top line revenue.

Crock-Pot is Dead. Long Live Crockpot.
A vintage brand loses its hyphen to please a new generation of consumers
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Why It’s Time for Brand Leaders to Get Serious About Emotion
It’s not just how people perceive you. It’s how people feel about you.

Coca-Cola restructures marketing to ‘drive more growth’
Coke streamlines to just five product categories and cuts ‘zombie brands’.

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