Greg Geracie, Actuation Consulting, Take Charge Product Management

What’s the Difference Between a Value Proposition and a Positioning Statement?

In 2014, Agile, Business Analysis, Lean, Product Management, Product Management Facts, Product Marketing, Product Owner, Product Teams, Project Management, Uncategorized, User Experience by Leave a Comment

It’s easy to confuse the concept of a value proposition with a positioning statement. However, it is important to recognize that these are separate and distinct statements that each have their own unique place.

An effective value proposition communicates what a customer can expect to receive by using a product. Think of the value proposition as what you are promising the customer. Value is often the difference between a customer’s perception of the cost versus the anticipated benefits realized. The benefits encompass not only the direct benefits of reaching a desired goal, for example 20% whiter teeth, but also the indirect benefits like ease of use.

Contrast this with a positioning statement which defines a product’s advantages versus those of a competitor or competitors overall. It also explains why this difference matters.

A strong positioning framework* describes…

  • For (a concise definition of the target market)
  • Who have (problem statement describing the need)
  • Our product is (a name to help categorize the solution to the market)
  • That provides (key benefits and the derived value)
  • Unlike (reference a competitor or the competition)
  • Our solution (key advantages that differentiates the product from the competition and creates customer value)

An example of a positioning statement would be “while other housing providers offer a one-size-fits-all solution for everyone, we provide specialized housing to seniors that eliminates stairs and sharp edges, with a focus on safety in order to prevent injuries and allow seniors to live an independent lifestyle for as long as possible.”

Value propositions and positioning statements are both exceptionally valuable communication mediums that help focus your team’s efforts and help customers understand the value you are creating on their behalf.  Understanding the difference between the two statements is important so that your message is sharp – and on target.

* Editors Note: This is one example of several types of positioning frameworks that are widely available.

Leave a Comment