Positioning Statement vs. Value Proposition: What’s the Difference?

For a busy entrepreneur, it’s easy to feel lost in a sea of marketing jargon. You’ve likely heard about value propositions and brand positioning statements, but what do those terms mean? How are they different? Do you really need both?

The short answer is yes, they are different. And yes, you do need both. Below, we’ll define the two terms, explain how they relate, and why understanding positioning statements vs value propositions is a worthwhile process when it comes to building a successful marketing strategy for your company. Indeed, not taking the time to explore these concepts can lead to unfocused marketing. You’ll also learn how to craft each to create a solid foundation for your marketing efforts. 

Positioning Statement vs Value Proposition – Where to Begin?

Let’s begin with definitions of a positioning statement and value proposition:

A value proposition is a concise statement that summarizes why a customer would buy your product or service. It describes what sets you apart from your competition and sometimes gives an overview of your brand’s benefits. 

A positioning statement, on the other hand, is a description of your product and target audience and how your product or service solves a problem or fills a customer's need. It is broader in scope than a value proposition. In fact, it contains the value proposition. For this reason, it makes sense to…

Start with a Value Proposition

The key elements of a strong value proposition are your “why” and your benefits. Your “why” is your answer to the following questions: Why should a consumer buy from you? Why this product? Is it your years of experience? Your unique solution? Your incredible track record? 

Next, you should be able to articulate how your product or service is going to benefit the consumer. How will it make their lives easier? Their job faster? What does it do? And finally, how is your solution different from your competitors? Sure, not every value proposition statement includes all of these elements, but the idea is that it communicates THE reason customers should choose you.

For example, “Nike's brand value proposition is to provide fashionable, innovative, and high-performance shoes for customers in every sport to meet their changing demands.” Nike’s slogan, “Just Do It,” is inspirational and motivating, fitting for its target audience of athletes. Nike communicates this value proposition by sponsoring professional athletes and athletic events, giving its products social credibility and proof. 

Coca-Cola’s Coke brand value proposition is to provide refreshment and enjoyment to people of all ages and demographics worldwide. Coke’s slogan is, “Open happiness.”  Coke has consistently aligned its brand with emotion over time, and this slogan has a broad appeal. Drinking a Coke is associated with happy gatherings, movies, ball games, family dinners, and even road trips. You aren’t buying a beverage, you are buying happiness. Hard to argue with that.

Southwest Airlines also has a strong value proposition. The airline disrupted the traditional market model in the 1970s and early 80s with its low prices, shorter flights, and the decision to fly only Boeing 737s and forgo assigned seats. According to Business Model Analyst, its value proposition is: “low-cost airfares, free-fee baggage (up to two pieces of luggage at no additional cost), a broad network of destinations, qualified customer service, beneficial rewards program, and additional services at small costs.” Southwest appeals to budget-conscious travelers who don’t mind sacrificing a few perks to save money. 

Next, Create a Positioning Statement

So, you’ve crafted a solid value proposition for your brand. Now it's time to zoom out and put it in the context of a broader positioning statement. A positioning statement should describe your product and your target audience. It should also demonstrate how your product provides a solution to a problem. Further, it includes your value proposition and details about why you’re in business and what makes you different from your competitors. 

To get started, you’ll want to brainstorm around these key questions: 

• Target Audience - who is your ideal customer? Who do you serve?
• What value do you offer? (i.e., your value proposition)
• How do you position your offer? Are you faster, cheaper, or more experienced? 
• Why are you in business? As Simon Sinek says, “Start with why.” It’s important to know why you are doing what you’re doing and to be able to articulate it. 
• What makes your brand, product, service, or solution different? 

Often this exercise gets distilled into a Mad Libs-style fill-in-the-blank sentence that looks something like this: 

“[Company name] helps [target customer] 

[verb]___[positive outcome] 

through [brand’s unique solution]

so they can [transformation]

Instead of [villian/roadblock/negative outcome].”

Granted, filling this out should be a thoughtful, carefully considered process using the answers you’ve settled on from asking the questions above. Distilling it down to one or two concise sentences ensures it will be more precise, memorable, and useful for your team.

Let’s look at how Nike, Coca-Cola, and Southwest Airlines might craft positioning statements for their unique companies. (Since positioning statements are often used internally, we created these based loosely on the template above.)

• Nike helps athletes in need of quality, fashionable athletic wear source high-performance shoes and athletic apparel through its commitment to innovation and the latest design and fabrication technology so they can perform at the highest level instead of being hampered by ill-fitting gear.
• Coke helps individuals quench their thirst and experience happiness by crafting tasty, refreshing beverages so they can feel refreshed and energized instead of thirsty and unsatisfied.
• Southwest Airlines helps budget travelers reach their destinations safely and affordably by providing low-cost, no-frills flights so they can connect people to what’s important in their lives.

Putting your Positioning Statement and Value Prop to Work

The goal of a positioning statement is to align your marketing efforts with your company’s brand value proposition, so you can consistently communicate it to your target audience. As noted above, positioning statements aren’t generated to share with your customers but to be used internally to align messaging and communications.

Having a clear positioning statement and value prop also helps new employees quickly get up to speed on who the target audience is, how the brand is appealing to them, and what qualities it is leveraging to convert them into happy customers. It helps ensure that when the CEO is giving interviews or the marketing manager is creating CTAs, similar messaging is being used because everyone is operating from the same foundation.

Understanding the difference between a positioning statement vs a value proposition can sometimes feel like an academic exercise without tangible benefits. However, taking the time to develop these key statements for your brand truly can make your marketing efforts both more cohesive and more effective.

In fact, it’s one of the first steps we take with new clients — to walk them through a step-by-step process in order to help them arrive at a well-crafted positioning statement. It’s an essential part of the foundation for profitable and predictable growth. How can your brand benefit? Schedule a no-pressure introduction to Brand Theory today and find out.