The Seven Basic Value Propositions
Value propositions are like story plots — they’re all variations on common themes.
Just like there are seven basic plots in literature and film, there are seven foundational values that people spend money on. I challenge you to think of brands, products, and services you use in your daily life, and apply this framework to them.
Understanding this framework will increase your awareness of core motivations, regardless of what industry you are in, and give you methods for brainstorming improvements and messages that resonate with your audience.
Finding product market fit
Every product, business, brand, service, or other impactful venture has been successful through product market fit. Marc Andreessen coined this term and defined it as:
“Being in a good market with a product that can satisfy that market.”
If you neglect Product Market Fit, your worst fears will come true. The money will dry up and you will be left reckoning with your failure. By getting to know your users and applying this framework, I hope you can articulate why your product is worth choosing (and spending money on) to achieve product market fit.
Customers value different things, a little bit differently.
Jean and Alex are two Starbucks drive-through customers. Jean is on her way there to save time because she wants coffee, but has an appointment coming up. Alex is also looking for her caffeine fix but needs to be quick because she’s accidentally left the sprinkler on at home. Both value time savings, even if the contexts are different. The contexts of motivation are important for product design, because they help illustrate emotion through the full customer journey, but the core value for these two Starbucks customers is to save time.
At the risk of ignoring complexity, I’ll note that the boundaries between these seven values (time, money, social capital, comfort, certainty, novelty, ethics) can be murky. Ascribed values are different for different customers (think of the Clorox bleach pen example), or can be interwoven for a single user. For instance, the axiom that “time is money” might suggest that time and money are not separate value propositions.
While they are often related, when a product can save time and money the additive nature of the following values create a stronger result:
The seven core value propositions
- Save money — I can get a similar result at a lower price point
- Save time — I can get a similar result faster
- Social capital — I stand out (or fit in) amongst my peers more
- Comfort — Reduce pain, especially physical
- Certainty — Reduce ambiguity…because it’s uncomfortable
- Novelty — Reduce monotony…because people don’t like being bored
- Ethics — spending money on this makes me feel like a better person
Every successful brand or feature is anchored in at least one of these seven values. Often the most successful integrate multiple values into their raison d’etre. Let’s examine each and illustrate their power.
1. Save me money
Walmart is the largest company in America, and its tagline literally says “Save Money. Live Better”. A clearer example cannot be found. With the introduction of the Great Value brand in their stores, Walmart was able to provide generic goods at the lowest price possible, undercutting their brand-named analogs on the shelf.
There are all sorts of companies leveraging this value proposition. The Honey chrome extension uses automation to attempt coupon codes during checkout. Acorns helps you save change and invest it whenever you swipe your card. Mint helps audit your spending. Geico helps you save on car insurance. Financial Advisors literally get paid to help you save.
2. Save me time
Ordering food through a company like Doordash is not less expensive than other dining options.
It does save you time and that time is valuable. Saving time is a main component of the value proposition for landscaping companies, contractors, drive through windows at restaurants, fast food, etc. who all get things done faster than a similar option might. E.g. doing the yard work yourself, or parking and entering the store to order.
3. Increase my social capital
The value proposition is most commonly framed in the context of a community. Those “in the know” will recognize you as being a part of their group. Any hobbyist brand you can think of falls into this category. For instance, someone wearing La Sportiva gear is likely a rock-climber, or someone in a Titleist hat is signifying they play golf. Yogis might wear Prana or Lululemon. By spending money with these brands they increase their credibility and social standing amongst the communities they identify with.
Luxury brands also use the social capital value proposition. Rolls Royce is, in some ways, synonymous with luxury. Someone driving a Rolls must be part of an elevated social class by association. Their ads are even explicit in using exclusivity to sell the Rolls Royce Phantom.
4. Increase comfort (or reduce pain)
People will absolutely spend money to avoid physical discomfort. They buy massage chairs, medications, inversion tables, new pillows and beds, different shoes…anything that might help live a pain-free life. This is perhaps the most straightforward of all value propositions and is a worthy goal for any new company or product.
5. Increase certainty (or reduce ambiguity)
Certainty is a complex value. Similar to comfort, this is about reducing pain…though emotional instead of physical.
The unpleasantness of anxiety and indecision are at the core of it. We, as humans, do not enjoy making decisions without all of the details present, or the assurance that everything will be okay even if we make the wrong choice. Whether that’s the choice to go to visit family in the midst of a pandemic (at-home COVID tests), as many faced in the last couple of years, or whether to buy an expensive piece of outdoor gear. Companies who can solve the anxiety of decision making are selling certainty. See ambiguity effect.
REI has been an industry leader in outdoor recreation for decades, but one of the things that has made them immensely successful has been their generous return policy. They give their members a full year to return most products for any reason, completely removing anxiety from the purchase. When faced with a purchase decision, their customers think, “It can’t hurt to buy it, because if I don’t like it they’ll make everything okay.”
Security, knowledge, and order are the hallmarks of certainty.
6. Introduce novelty (or reduce monotony)
Art introduces novelty. The gaming company Nintendo built an empire by reducing boredom. The travel industry thrives on the idea that it’s about escaping the daily grind. A tasty meal is about seeking excitement. All of these have core values in altering the normal routine and re-engaging with life.
Novelty is, perhaps, one of the most widely applied because it can be either a core value, as in the gaming or amusement park industries, or an ancillary value, as in a delighting feature on a product that you might not have bought otherwise (the transparency mode on Airpod Pros got me here).
Sports cars often have an aspect of novelty in their advertising. See this Porsche ad below drawing a metaphor between their cars and an amusement park. Experiencing luxury gives on an “oh, that’s nice” feeling and each time that thought comes to mind, it breaks the cycle of monotony.
7. Appeal to my ethics
Products that provide ethical value are often B-corps, or companies with social impact missions that supersede their profit goals. Nonprofits fit into this category. Even if you’re not buying something from them, they get you to spend money on the feeling of doing something good for the world (in-line with your ethics).
Patagonia’s home page often features a non-profit or climate issue, rather than the products they are actually selling. They became famous for the ethics strategy when they ran their ad campaign “Don’t buy this jacket”. The campaign did an admirable job of highlighting needless consumerism, but it also drove sales up 30%, while ethical value is clear in this example, Patagonia embodies almost all of the basic value propositions and has built a strong brand because of it.
Strong brands embody multiple core values
Many of these examples above advertise one value primarily, but many have risen to notoriety by creating additive value. Whenever multiple value propositions exist in a product, there is an increased resonance with customers from different contexts.
I mentioned that Patagonia has built an incredibly strong brand by hitting five of the seven core value propositions.
- Save me money — Patagonia’s repair, not replace, and lifetime warranties mean you never have to re-purchase. While the upfront cost is high, over time you can save money.
- Appeal to my ethics — The company’s B-corp status and clear commitment to environmental issues is well advertised and understood.
- Increase my social capital — The products are luxury and feature a prominent logo. People who wear Patagonia consider themselves part of a certain social circle.
- Increase certainty — You never have to worry about whether the quality of your purchase will satisfy because of Patagonia’s lifetime warranties.
- Introduce novelty — Like a sports car, Patagonia’s products are well designed and pleasing to use. Every time you use them the quality and association with outdoors creates a re-engagement with life (even if a small one).
Patagonia has a loyal base that appreciates all five of these values they get from the brand. However, by covering so many they also have customers who only care about being part of the social circle, or who only buy because of the warranty. The addressable customer profile is wider because of the number of reasons to buy.
Align values and create a strong product market fit
As you tell the story of your brand, work on new features for your product, or begin to form a new company, these core values are a helpful framework for both ideation and focus. If you can align multiple values, like Patagonia, you are sure to find a strong Product Market Fit and build loyal (and loud) fans of your business.
Can you think of examples that don’t fall into this framework? Let me know what you think in the comments.
Special thanks to Tremis Skeete, Executive Editor at Product Coalition for the valuable input which contributed to the editing of this article.
