Part 5. Product Innovation and Management
Published Online: 15 DEC 2010
Copyright © 2011 John Wiley & Sons, Ltd. All rights reserved.
Wiley International Encyclopedia of Marketing
How to Cite
Sarin, S. 2010. Value Proposition. Wiley International Encyclopedia of Marketing. 5.
- Published Online: 15 DEC 2010
Value proposition is the sum total of all the benefits a seller's offering delivers to a target customer in a purchase. Development of a compelling value proposition starts with the identification of the key value drivers for the customer, and/or the key value elements of a seller's offering. Three types of value elements are seen: (i) points of parity (i.e., elements that are the same as the next best alternative); (ii) points of differentiation (i.e., elements that are superior or inferior to the next best alternative); and (iii) points of contention (i.e., elements on which the buyer and seller disagree as to the value). Using these value elements, sellers can construct three types of value propositions: (i) all benefits (i.e., a listing of all the benefits sellers believe they deliver to the target customer); (ii) favorable points of differentiation (i.e., differentiating the seller's offering from the next best alternative); and (iii) resonating focus (i.e., making the seller's offering superior on the few key elements that matter the most to the target customer).
- value to the customer;
- value proposition;
- customer value proposition;
- competitive parity;