Customer value proposition: Getting the brand promise to your customers right

Ric Navarro

  • Global director of marketing and communications, Norman, Disney & Young
  • Website
In his role as global director of marketing and communications for professional services consultancy, NDY, Ric leads the strategic and tactical delivery of the firm's marketing and communications objectives across the organisation's global footprint. His strategic, results-driven approach contributes to the firm's commercial outcomes, operational performance, client centricity programs and business growth. Ric started his career as a journalist with one of Australia's leading publications. He subsequently took these skills to successfully manage communications for the Prime Minister's 'Supermarkets to Asia' program. Over his career, Ric has advised a number of leading firms including mining, FMCG, infrastructure, retail, manufacturing and build environment organisations. This has seen him implement and manage communications, marketing, corporate affairs, digital strategic, corporate social responsibility, stakeholder management and client programs.


Throughout my career, I have witnessed a litany of brand names that profess to have a unique customer value proposition (CVP).

In reality, however, they’ve had little more than a ‘value proposition’: A simple list of benefits applied to a general audience.

Let’s be clear. A CVP is not your brand name. It’s not your products, services or even your slogans. A CVP is a clear statement that encapsulates three key criteria:

  • Relevancy: Explains how your product improves a specific customers’ life or solves their problems
  • Value: Deliver quantifiable concrete benefits
  • Differentiation: Shows your ideal customer why they should buy from you and not from the competition.

From a customer’s perspective, a properly formulated CVP is a promise; they expect you to keep it. It is the foundation of the relationship you have with each of your customers. It is the lens through which your customers see and value your product or service. A CVP is a statement that can be understood by all your customers. It should be lucid, ‘humanised’ and easily understandable.

To highlight the difference between a well-crafted CVP and a meaningless one, here’s an example of a poor promise:

“Revenue-focused marketing automation and sales effectiveness solutions unleash collaboration throughout the revenue cycle.”

Did you struggle to understand what the offer is, and how you would benefit? I did. Unfortunately, such meaningless jargon-riddled statements are plentiful. Lurking behind the absence of a CVP is the real issue for brands – their evident lack of understanding about their customers.

Whether your brand sells directly to the public or is a B2B enterprise, a meaningful CVP will always answer the question for customers: Why does this brand best meet my needs?

Make customer research a ritual

To do that, you need to find out what language your customers use to describe your offering and how they benefit from it. This is where detailed customer research is critical.

Commit to undertaking regular, programmed research. Depending on your product or service, this can range from hourly and daily, through to monthly or twice yearly. This regularity – or consistency – is crucial in today’s fast-moving environment. Obsessing about your customers – their thoughts, feelings and behaviour – is the bedrock of corporate strategy. Without it, you cannot understand your brand the way your customers see.

Avoid breaking promises

According to Accenture research, broken promises permeate customers’ relationships with brands. Seventy per cent of respondents to its 2015 survey, Promises, Promises: Easily Made, Easily Broken, say a company promised them something in the past year, and upwards of 40 per cent say such promises were broken.

When a company is seen to break a promise, it tends to break more than one. Two out of three respondents say the same company broke their promise two times or more. If this happens, customers are more prone to see the company as a habitual promise breakers.

And when a brand fails to deliver on its CVP at any point in the customer’s lifecycle, the net effect will typically result in cancelled orders, an upsurge in complaints, a falling Net Promise Score (NPS) and a subsequent shift to competitors. In fact, according to Accenture’s Broken Promises research, 90 per cent of customers who encounter a broken promise eventually switch companies or seriously consider doing so.

Let’s take United Airlines as a case study example of the impact of a broken CVP. United has one of the most comprehensive international airline route networks, making it a top 10 global leader in the airline business. On the website, the airline carrier proudly articulates its CVP as:

“We fly friendly: Warm and welcoming is who we are.

“We fly together… we respect every voice, communicate openly and honestly, make decisions with facts and empathy, and celebrate our journey together.

“United the world. Every day, we help unite the world by connecting people to the moments that matter most. This shared purpose drives us to be the best airline for our employees, customers and everyone we serve.”

Now let’s consider these CVP promises against the events that unfolded on a United Airlines flight on 9 April 2017, when a police officer arrived at Chicago’s O’Hare airport after being summoned. He entered a plane about to head to Louisville, Kentucky, wrenched an elderly man from his seat and dragged him down the aisle. This passenger’s crime? Refusing to give up his seat (a spot for which he had paid) because United overbooked the flight. The passenger, who was bleeding, reportedly suffered a broken nose, concussion and two knocked-out teeth.

Unsurprisingly, outrage convulsed social media, fanned by the United chief executive, Oscar Munoz’s inexplicable letter to employees, in which he blamed the victim, a 69-year old Asian-American doctor, David Dao. Within 24 hours, United lost US$253 million in market capitalisation.

This significant fracture in reputation saw United spend a fortune to claw back the reputational damage. Why? Because the actions of removing Dr Dao broke the essence of the customer brand promise that United makes to its passengers. Such actions certainly don’t uphold the brand promise of “connecting people to the moments that matter most”.

Forfeiting a CVP promise, and failing to deliver on it in every detail, can have disastrous outcomes.

How to secure buy-in to your CVP

The best CVPs answer three simple questions: What is the promise? For whom will this matter? How is it useful?

To communicate your CVP clearly, you then need to ensure it’s easy to understand. You also need to communicate, in a compelling way, the concrete results a customer will get from purchasing and using your products and services. You need to state how it’s different or better than the competitor’s offer, while still avoiding hype and business jargon. And this CVP needs to be easy to read and understand in a few seconds.

In addition, you need to differentiate your offer from competitors. The criteria I use to achieve this is to match a competitor on every dimension of value, except one. Because in at least one element of value, your brand needs to excel.

Your well-crafted CVP is the cornerstone of brand success. It melds customer insights, competitive analysis and product evaluation to deliver an authentic, succinct and supportable statement of the product or service’s value.

This excerpt comes from Ric Navarro’s recently published book, Marketing with Purpose: A c-suite guide to being truly customer-centric (2018, printed by Waratah Group). Find more details and order you copy at: www.marketingwithpurpose.solutions

 

Tags: brand strategy

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