Value Propositions - How to create them and why they're valuable for your SaaS

Value propositions are the foundation of SaaS growth strategy. Learn how to create a set for your company.

Why are value props valuable?

  • Value propositions are the foundation of your growth strategy
  • They help anyone considering your product to quickly know whether they will benefit from using it
  • Value props are insanely valuable in a world where attention is so thin
  • Clear value propositions are the basis of clear copy, clear product development, clear onboarding, clear advertising
  • One of the biggest errors you can make when building a SaaS business, besides not validating your idea in the first place, is not having a clear understanding of what value your product or service provides to customers

How do I know if I have value props nailed?

  • When your value props are nailed down solidly, you no longer take 10 minutes to explain your concept to people
  • You can summarise within a series of short bullet points why people would buy your product
  • In fact, if you review any SaaS business, you can get a pretty good idea of how well they’re doing by how wide the variation in value proposition is across their marketing output.
  • Companies who are growing nicely tend to have one of two things:
  1. Wild amounts of VC money to burn
  2. A clear and narrow focus on the value they provide to customers

What does value look like?

  • Value is so subjective but generally it hangs on one of the following:
  1. Money - Save customers money; make customers money; help them be more efficient with money
  2. Time - Save customers time; Help them maximise value from time
  3. Reputation – Make them look good to colleagues, friends or family
  • If you have no other concept of value for your customers, make sure that you can give them value in one or more of these areas

How do you find out what the value of your product is?

  • There’s a couple of ways to do this
  • Bottom up – this is best. Talk to your customer or target customer. What is their problem like? How inconvenient is it for them? How have they tried to solve that problem in the past? What have the issues been with that solution? How is what you’re providing or proposing to provide a better alternative? Source for finding this:
  • Customer interviews – use descript to transcribe these. They’ll be valuable for your copywriting later.
  • Testimonials – Ask for super specific things. Value props without evidence are just statements.
  • Usage data for your SaaS – it’s an art but you can be systematic about understanding what the value is from how users are using your app. You collect huge amounts of data if you’re running a SaaS. Use it for good things. It doesn’t make you Cambridge Analytica.
  • Top down – I don’t recommend this, but you see it a lot. You probably have an instinct for what your customers find valuable to you. However, it’s only by talking to and observing your customers that you actually learn what they find valuable. Don’t fall into the trap of top down value assumptions because you’ll only end up missing out valuable nuggets of information

How do I go about creating them?

How can I use them in my growth work?

  • A detailed set of value props based on evidence will be your clipboard for the rest of your growth work
  • Need some copy for a Facebook Ad? Grab it directly from your value props.
  • Doing a pitch to investors? Hey, here’s a slide showing the value. How did we get this? Direct from customer interviews we did.
  • You can use these value props for any and everything in growth. They are gold dust.
  • Top tip: ask someone outside the company to review them with you. EVEN BETTER: ask your customers to review them with you.
  • And when you do say things like: What did I leave out here? How would you have phrased this differently?

Here's another link to the original thing. Check it out.

Key Takeaways

October 12, 2020

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