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A Framework for Creating Value Propositions

Part 1. Marketing Strategy

  1. James C. Anderson,
  2. Gregory S. Carpenter

Published Online: 15 DEC 2010

DOI: 10.1002/9781444316568.wiem01059

Wiley International Encyclopedia of Marketing

Wiley International Encyclopedia of Marketing

How to Cite

Anderson, J. C. and Carpenter, G. S. 2010. A Framework for Creating Value Propositions. Wiley International Encyclopedia of Marketing. 1.

Author Information

  1. Northwestern University, Evanston, IL, USA

Publication History

  1. Published Online: 15 DEC 2010

Abstract

A value proposition is the statement of those few points of difference that create a compelling reason for a customer to select one market offering relative to competing alternatives. The primary factors in constructing value propositions that target customers find persuasive are frame of reference, points of parity, and points of difference. The frame of reference is the set of potential competing alternatives that a customer considers. Points of parity are the elements of the market offering on which the customer views the offerings as essentially the same. Points of difference are the elements of the offering on which the customer views one offering as noticeably superior.

Potential value propositions can be evaluated on three criteria: distinctiveness, measurability, and sustainability. Distinctiveness captures the extent to which the value proposition is uniquely able to deliver on a claim relative to alternative offerings. Measurability is the extent to which the value proposition can be substantiated in tangible ways, such as in monetary terms. Sustainability captures how long the uniqueness the value proposition conveys is expected to last.

Keywords:

  • value propositions;
  • points of difference