Unique Selling Proposition vs. Value Proposition (with examples)

We are regularly asked, “What is the difference between a unique selling proposition and a value proposition?

In this tutorial we are going to answer this very important question!

This is a very impactful question because the answer...

• Impacts almost all operations, hiring decisions, marketing campaigns and even the balance sheet, and
• Absolutely impacts top line sales revenue!

Everything else trickles down from there.

So, let’s dig into this important topic and answer it with descriptions, examples and an actual plan for you to develop your own unique selling proposition within your value proposition.

What is the difference between a unique selling proposition and a value proposition?

Your Unique Selling Proposition (USP) is what sets you, your business and your product or service apart from your competition. Your USP can be an actual fact, or a perceived difference or specialty.  On the other hand, your Value Proposition (VP) is a fundamental business model decision that serves as the core strategy a company chooses to separate themselves from the competition. 

While always intimately connected in all business activities, the difference between the USP and the VP seem like they should be slight, but in reality they are very very different.

The biggest difference between these two principles is that the Value Proposition is deeply ingrained within the company core operations, while the Unique Selling Proposition is more fluid and flexible in its development. Another key difference between the USP and VP is that a company can only have one Value Proposition, and to be successful, they need to go all-in on this one. Alternatively, a company can have literally dozens of Unique Selling Propositions, especially if they are selling to different customer personas and are offering multiple products and services.

What is the function of the value proposition?

If you have read our tutorial explaining the three core Customer Value Propositions, you already know they are     Customer intimacy, Operational excellence and Product leadership. And you know there is a lot of opportunity in the Customer Intimacy value proposition.

But, let me explain with a few starter examples if you are just discovering this idea of the value proposition:

• Would you want to do business with a company that's just "there," with no unique benefit or no incredible price reductions or wide selection, void of excellent service or even a guarantee?
• Or, would you prefer to work with a company that offers you the widest selection in the city, country, or world?
• Or, a company that charges a fraction of what other competitors charge?
• Or, on the other hand, one that sells the "Rolls Royce" of the industry's products?
• Can you see what a pleasing difference the value proposition makes in establishing a company's image or position to the customer?

In all the above examples, the value proposition is, relative to competing brands, how the company chooses to separate themselves from the competition.

Think: McDonalds vs Five Guys. Both serve hamburgers, both are competing for hungry customers who eat in a quick serve restaurant format.

McDonalds delivers on an Operational Excellence value proposition to their customers. Every store is the same, food is barely acceptable and customers expect and can trust everything is done in the exact same format.

Five Guys, on the other hand, provides a Product Leader position. Food is as good as an expensive sit down restaurant and prices are far more expensive. Both strive to just meet the core expectations for the remaining value propositions.

But now, let’s go a layer deeper and develop the unique selling proposition.

What is a unique selling proposition?

First, unlike your one company value proposition, know that your business can have many unique selling propositions.

For example, maybe you own a moving company, let’s call it “Muscle Movers”. You could be selling to many marketplaces, such as:

1. Let Muscle Movers wrap, pack and move you across country -- stress-free and affordably
2. You can trust Muscle Movers to transition and care for your loved ones to a safe, secure, local community
3. Across town or across the street, Muscle Movers will take care of all the moving details for you

These are three different market segments and the advertisements will be shown in multiple locations, such as LinkedIn, real estate networks, local HR departments, older community centers and even HOA’s.

The market segments are different and require different Unique Selling Propositions.

Again, the point of a USP is to focus on the niche or the need in the marketplace and deliver a promise you can make. Your unique selling proposition (USP) is what sets you and your product or service apart from your competition and clearly tells your customer the benefits.

Every business must have at least one USP. Some businesses have many.

The companies that have the most success know their market place and the competition very well.

For example, there is a very famous story about Walter Chrysler, who formed Chrysler Corporation.

He went out and bought several of the most popular selling cars in America. He then brought them home to his garage and took them apart down to the very last nut and bolt.

Then, he put the cars back together again. By the time he had done this with several cars, he had some great ideas on how to create a car that was better than other cars in America.

So, the core of your USP must be focused on your uniqueness in the marketplace.  How your products and services are different, or better, than the competition. Your USP may be expressed as a summary of what you do and how you do it better or differently.

Unique selling proposition example

Here are some simple characteristics and action steps that you can take to develop your own USP.  The examples and suggestions are guidelines and can help you clarify your thinking on this fantastic strategy.

1. Your USP should be one sentence – usually less than 15-20 words.
2. Every person on your team needs to be able to easily remember it, and say it (your customers are considered members of your team as well -- after all, from them will come your raving fans!).
3. Your USP is emotional. Action on behalf of your marketplace is ultimately inspired by the removal of pain or the gain of pleasure.
4. Use your USP in your marketing and advertising campaigns.
5. Here are two methods to begin your USP:
   1. "Do you know how [state the problem your best prospect has]?"
   2. EXAMPLE: “Do you know how to become faster than your competitors?”
   3. "What I do is [state the solution your product/service solves for your best prospect]."
   4. EXAMPLE: “What I do is take over after your doctor tells you to lose weight.”
6. Your USP should fulfill a void in the marketplace – with a promise that you can and will deliver.
7. Does your USP define your position in the niche market of your choice and is the marketplace willing to pay you for it?

As your product line expands, as your customer’s needs change, and as your marketplace changes, your USP will change.

But, if you find a USP that is successfully bringing clients to you, do not change what is working without independently testing other USP’s to produce better results.

This is a good problem to have!