Value Proposition Workshop: Understand Your Customers and Competitors
There should be 3 areas of discussion and discovery during your VP (Value Proposition) Development Workshop with the VP Team you’ve assembled. As you finish each session, tape your flip chart sheets up if at all possible. The discussion will be more insightful if your team can refer back to your previous documentation.
First, you’ll analyze your customers and their objectives, as well as your competitors. This is essential in understanding how to position and differentiate your company.
Second, you’ll analyze your own company by going through several exercises meant to illuminate your company’s strengths and how to leverage them to meet customer objectives, and take advantage of growth opportunities. You’ll also discuss short and long term goals, which must be realistic in terms of financial commitment and help shape your brand strategy.
The final session will be the actual process of crafting your value proposition.
Start the session on Customers and Competitors by documenting target customer profiles. First, list each segment of your primary customer base. You’ll include:
1. The industry they’re a part of (Refining, Power Gen, Offshore Drillings, etc.)
2. The type of company they are (refinery, pharmaceutical processes, pipeline company, etc.)
3. The decision makers within each type of company (who has authority to buy from you?)
4. Influencers within each type of company (they don’t make the final decision, but their opinions count)
The next step in understanding your customer base is a discussion about what they expect when working with a company like yours, what their ultimate objectives are, and any needs they have that your company or your competitors are not meeting, for whatever reason. This part of the discovery process relies heavily on your outside and inside sales people, as well as anyone from manufacturing or engineering who’s dealing with customers on a regular basis. If you only have one target market, consider yourself lucky. This can be a rather lengthy discussion if you have multiple target markets with different objectives or unmet needs. You will need to go through the process for each target market. This is probably the most important part of this session, so take your time. Your value proposition MUST flow from an understanding of how your company meets your customers’ objectives in a quantifiable way.
1. What do they expect? List all the attributes that a customer looks for when sourcing a company like yours. Are references critical? Do they look for longevity and stability? What about engineering expertise? List everything a prospect would ask when you are approaching them for a sale.
2. What are their objectives? This part is very important, so take your time here! In listing out objectives, think about what problems your customers have that you solve. Does your product or service improve the reliability of some piece of equipment that is essential to their production? If so, one objective would be, “Increased equipment reliability.”
3. What are their unmet needs? Typically, their unmet needs are really “wants” that are not being fulfilled because none of their current vendors are willing to invest the time or money to do so. What do your sales, manufacturing, and engineering staff hear? Is there something that repeatedly comes up in discussions with customers about how your product or service could be improved?
Now, move into a discovery process regarding your competitors. This is where your “old timers” or anyone in your team who’s been in the industry for many years will be invaluable.
1. Instruct your team to try and be as unbiased as possible. What you’re really looking for here is how the industry perceives your competitors, not necessarily “insider” information you may have on them that is not common knowledge.
2. The two most important areas to cover are strengths and weaknesses. If you have different types of competitors, list strengths and weaknesses for each one.
3. As you go through the process, point out areas where your competitors are weak, and your company is strong. This can be very important to your value proposition.
Many marketing consultants will tell you that the information you need to assess about your customers and competitors won’t be accurate unless you conduct customer surveys, market research, and other forms of data collection. I believe this is a waste of time and money for an industrial company – especially one that’s been around for a while.
What you might need is a 3’rd party to facilitate your discussions so that the tone of the meeting is less casual and it yields more thoughtful results. Especially in businesses where the key employees have worked their way up through the ranks, there can be a certain nonchalance or arrogance when asked to analyze topics for which they believe there are foregone conclusions. If you think this is a possibility, hire an industrial marketing communications consultant. You’ll spend a lot less than you may think and the investment will pay off in far better results.