Unique Value Proposition (UVP)

If you have pitched to a VC or seen VC style business plans you may have come across the term Unique Value Proposition or UVP. I have found that many companies and businesses usually think about this after they have created their service or product. That is a big mistake. If you are product manager and you are creating a UVP after the product has launched you are in big trouble.

The importance of UVP did not hit me until after I did a few sales calls. I currently own a small IT consulting company that works mainly with SMB. Initially I was fairly successful because I knew the right people and it got me a lot of customers due to relationships I had built. But one day, one of our salesperson came back very frustrated because every potential customer had told him that their current IT company did exactly what we did and cheaper. I validated this with some cold calling on my own. Suddenly I faced the dilemma of not having a UVP and was stuck in brutal price war.

I learned a valuable lesson that day; you have to create a UVP before you create your product or service. Here are some examples of some good UVPs:

1. Wendy's: Fresh Fast Food
2. Google: Fast and accurate web search
3. Microosft: The only game in town for PC Software (at least in the 90s)
4. Apple: Innovative consumer electronic products that customers love
   
5. Disney: Fun for the entire Family
   
6. Wii: Fun and Easy gaming console for the whole family

Notice that UVPs are very succinct. Customers have short attention span. You have 30 seconds to win or lose a customer. Here are some attributes of a good UVP not in any order of priority.

1. Clearly Defined Market Segment --You cant be everything to everybody.
   
2. Uniqueness-- Significantly better than the alternatives both within and outside the industry
   
3. Value -- Makes the life of the customer better (health, productivity, prestige, security etc.)
4. Pricing -- Makes the product accessible to the target market
5. Focused -- It is very clear what the product or service delivers.
   
6. Strength- Leverages your key assets and strengths.
7. Divergent -- Unlocks a new market segment
   

What do you think? Comments are appreciated.