“Jer, please tell my new assistant your story.” The Costco buyer asked this question to start the meeting.
Jerry Swain, CEO and founder of Jer’s Chocolates, smiled at his VP of Sales. It was done: They were going to land distribution in Costco, one of the biggest whales in all of retailing. Put a fork in it. Book it.
How did Jerry know? Because they weren’t being asked about their product or the price. Their story, their “Unique Value Proposition” (UVP), would carry the day.
That’s the power of UVP.
This week, we’re looking at the critical importance of an annual planning meeting. So far, we’ve looked at how to prepare and start the meeting. Next, we covered how to conduct a 12-month business review .
Next up: Formulating or revising the strategic positioning of our company.
Without a unique value proposition, it will be hard to generate sustainable double-digit growth,” write Mark and his co-authors. “Many businesses try to be everything to everybody. This simply does not work. Having a UVP backed by research is key to compete, succeed, and stay out of the commodity game.”
So, what are the specific elements of a UVP?
“A value proposition defines the problem we are solving, who benefits from the solution, and how they derive the benefits,” the authors write. A unique value proposition is something unique to the organization.
Be warned. Creating a real UVP can be harder than it sounds.
“Every CEO believes that their company’s products have a competitive advantage,” the authors write. “The truth? Very few do.”
A true UVP means the company, product, and brand are the first choice for clients. “If your clients choose you only because they are not aware of a better option, you are in big trouble when they eventually find the better option,” they write.
Jer’s Chocolates is a great case study of what it means to have a competitive advantage through a strong unique value proposition. The authors write: “Jerry and his team were able to price their chocolates far beyond most of their competition thanks to their UVP.
“An average peanut butter cup at the grocery store typically sells for one dollar, which translates to about ten dollars per pound. Jer’s artisan peanut butter confections earned them happy consumers at thirty-six dollars per pound, and they successfully amassed tens of millions of customers.”
So, how did they achieve these results?
“We researched the industry and saw that premium chocolates were growing at five times the pace of pedestrian chocolates,” Jerry recounts. “Not just in specialty stores, but for the first time, grocery stores were making room on their shelves for premium options as well.”
Identifying an opportunity is one thing. Capitalizing on it is another. This work is the agenda item for the second “working session” of our annual planning meeting. We must design the inner workings of our organization to optimize our UVP. Anything that does not match up must be discarded.
“First, we differentiated our actual product. All-natural, best-available ingredients were important,” Jerry recounts. “We explained the flavor and quality difference between premium fair-trade chocolate and the specific artisan process we used to make our products. Why a Valencia peanut versus a Runner peanut? What made them the best tasting and best for you?
“The intrigue captured an audience, and we saw our fan base grow and want more education on our product. Our chocolates did not only taste better, but they looked different as well because they were not molded. When consumers had one of our balls, bars, Jer’s Squares™, or Groupies™, they saw all were uniquely a bit different, with slight variations in the size and shape of each individual piece of candy, making them feel like they were handcrafted and homemade.”
Jer’s Chocolates did not just differentiate their product. They also differentiated their story.
“The strongest branding component the company had was Jerry’s inspiring human interest story behind why he ventured from pursuing a successful high-tech career to becoming a chocolatier. His story includes his longstanding personal interest to “give back” to charities; thus Jer’s Cares was born and became part of the evergreen story.”
Jer’s story was featured on every product package, their website, and all marketing, sales, and branding collateral. Which is why leading retailers like Costco and QVC, “known for being extremely choosey on picking gourmet foods,” choose Jer’s Chocolates.
That’s the power of a UVP.
During the annual planning meeting, the authors advise using our UVP to organize our business to over-perform on what clients value most:
1. Identify what drives our advantage. Is it really that unique? Is it defensible going forward? Are competitors catching up and minimizing our advantage?
2. Select our product portfolio. If our business sells multiple products, we need to understand which ones have a definite competitive advantage and which ones do not, and then focus our resources there.
3. Target the right clients. Are we spending time and money on the wrong client segments?
4. Increase organizational fit. Our vision, values, goals, activities, and people must align with our strategy and competitive advantage. Competitors may be able to replicate one piece of our offering but not the entire system.
Reflection: Does my organization have a true Unique Value Proposition?
Action: Discuss with my team.