In his book, Your Music and People, Derek Sivers addresses a problem faced by musicians: being asked to describe the kind of music they play.

Saying “all kinds,” doesn’t help. That, according to Sivers, is like saying, “I speak all languages.” Nor does claiming to be unique, since all musicians rely on “notes, instruments, beats, or words.”

A better approach, he advises, is to come up with an interesting phrase that will get people thinking. Something like, “We sound like the smell of fresh baked bread.”

Sivers wasn’t talking about “value propositions” per se. But he was making a related point — the way you describe your organization’s work can have a profound impact on both how well you are understood and how long you are remembered.

What is a Value Proposition?

A value proposition is a simple concept (maybe that’s why the really good ones are so rare). One definition I like is:

A value proposition is a promise of value to be delivered. It’s the primary reason a prospect should buy from you.

Notice that it is fundamentally based on the customer’s perspective, something that distinguishes it from its sometimes jargony brethren, the vision statement, mission statement, and purpose statement.

What a Value Proposition Is Not

… full of business or technical jargon — and simply descriptive:

Here’s an example a student submitted to me as stated by the CEO of the startup at which he was interning a few years ago:

[COMPANY] is a SaaS-based technology platform that leading organizations use to design, run, and measure positive impact programs, including, but not limited to, corporate culture, well-being, social impact, and sustainability.

In addition to the excessively formal phrasing (“including, but not limited to”), and the large number of buzzwords, this description is generic; it could be applied to all sorts of organizations serving any number of markets. It may capture how those inside the company think about their offer, but I doubt it connects with prospects, investors, and others on the outside.

… a list of features:

As the old business adage goes, people don’t want to buy a quarter-inch drill; they want a quarter-inch hole.

Likewise, people don’t select your product or service because of its features, but because it fulfills a need or solves a problem. Your value proposition should focus on that.

… a tag line:

While it is possible for a tag line to also work as a value proposition, these are the exceptions; in most cases, the two are not the same and serve different purposes.

Consider Lyft, whose tag line is: “Lyft — Rides in Minutes.”

As an occasional user of the service, that phrase does indeed resonate with my experience. But it falls short of Lyft’s true value proposition. In fact, since Lyft is a two-sided platform — serving both prospective drivers and prospective riders — it needs two value propositions.

For prospective drivers, the value prop might be something like, “Make money in your spare time using the car you already own.”

For prospective riders, it should include the simplicity of ordering a ride from your phone, having the driver know where to take you, and not having to handle cash — all things that differentiate it from most taxi experiences.

It’s worth noting, as well, that Lyft’s value proposition, for drivers at least, is no longer identical to that of Uber, now that Uber has added more services, like Uber Eats. While initially, in a quickly expanding market, there may have been room enough for both companies to grow in parallel, Uber has already begun to create more distance between itself and its primary competitor.

How Does This Apply to Non-Profits?

If your organization is a nonprofit, try thinking of your value proposition in terms of what your organization provides for its customers (constituents) in exchange for financial support.

Granted, those who provide financial support for a nonprofit are often different than the people who receive the benefits. But in both cases, people are listening to understand the positive and unique impact that your organization creates for society from the funding it receives.

Consider the example of Alzheimer’s research and support, in which the Alzheimer’s Association, a $400+ million-dollar organization that funds research and offers support for caregivers, is the 800-pound gorilla. From what I understand, it does good work.

But competing for donors in that same space is Cure Alzheimer’s Fund (CUREALZ), an organization that grew out of frustration with the slow pace of research on the disease. It created a very different business model, designed around a highly-focused research funding plan. Its value proposition to funders is this:

“We are a nonprofit organization dedicated to funding research with the highest probability of preventing, slowing or reversing Alzheimer’s disease.”

Finding a cure for this terrible disease is common to both organizations. But in the contest for donor funding, CUREALZ’s value proposition is very tightly focused, allowing it to step out from behind the shadow of its much larger competitor, and raise money to back research in the process.

The Bottom Line

Success, whether as a for-profit or a nonprofit organization, requires a clear and succinct value proposition — one that reflects the perspective of the target audience, sets you and the work you do apart from the alternatives, and highlights the value you provide.


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