USP

A unique selling proposition (USP) is the single distinctive reason a defined audience should choose one offer over its alternatives. Genuine product uniqueness may be patentable, but most organisations compete with similar offers. Their task is to identify a valuable, credible and defensible point of difference and express it with memorable clarity.

When to use it

• Define the central selling claim for a product, service or brand.
• Focus advertising and positioning when an offer has many possible benefits.

Origins

The USP arose in advertising agencies during the 1940s as a discipline for creating messages that sold. A strong proposition was expected to offer a specific customer benefit, establish an association competitors could not easily appropriate and prompt action.

Rosser Reeves of Ted Bates & Company articulated the idea in 1940. He argued that advertising should make a concrete proposition rather than rely on vague image-building. His campaigns included Anacin and the M&M’s promise “melts in your mouth, not in your hand,” which translated the product’s sugar shell into a simple consumer benefit. Repetition made the claim strongly associated with the brand.

What it is

Use the following sequence to develop a USP:

• First—select the target audience: Define precisely whose choice you want to influence and in what buying situation.

• Step 2—identify the audience’s needs: List the functional, emotional and social outcomes that matter to those customers.

• Step 3—find poorly met needs: Determine what customers value but do not receive satisfactorily from current alternatives.

• Step 4—rank the needs: Weight them by importance, dissatisfaction and relevance to purchase.

• Step 5—inventory the value proposition: List the offer’s features, benefits and supporting services from the customer’s perspective.

• Step 6—compare competitors: Identify benefits your offer can deliver better or more credibly than the alternatives.

• Step 7—inspect the value chain: Examine materials, sourcing, production methods, expertise and quality controls for a meaningful point of distinction.

• Step 8—select one resonant claim: Choose the benefit, feature or story with the strongest combination of relevance, differentiation and proof.

SWOT analysis, customer journey mapping and a price–quality matrix can support the search. The objective is not an absolute claim to be the world’s best. It is to own a difference that matters to the target audience and that the organisation can continue to deliver. Test the proposed USP for comprehension, credibility, influence on choice and fit with the broader brand position.

Developments of the model

The broader customer value proposition (CVP) has often replaced USP language because it describes the complete bundle of benefits for which customers are willing to pay. The USP remains useful as the sharpest expression of that bundle. In Positioning: The Battle for Your Mind (1981), Al Ries and Jack Trout emphasised connecting a brand with a strong, distinctive claim in the audience’s mind; contemporary practice more often positions the brand than an isolated product.

How to use it

Zappos illustrates the discipline of choosing one message from a rich value proposition. Tony Hsieh joined the online shoe retailer in 1999, when annual revenue was about $1 million. Amazon acquired it in 2009 for about $1 billion. The company built a service culture around customer happiness rather than lowest price.

Zappos offered many benefits, but its exceptionally convenient returns policy addressed a central emotional barrier to buying shoes online: fear that the fit or style would be wrong. That clear promise helped the retailer occupy a distinctive position.

Developing a USP requires exclusion. Listing every strength dilutes recall and leaves the audience to decide what matters. Select the one promise most likely to influence the target customer, substantiate it with proof and express it consistently across the experience—not only in advertising.

Some things to think about

• A CVP can be comprehensive, while a USP forces useful simplicity. Ask what single factor you want a customer to remember and repeat after encountering the brand.

• Emotional relevance can make a proposition powerful. In the Zappos example, the returns promise reduced anxiety as well as practical inconvenience. Identify the emotional barrier or aspiration attached to your customer’s decision.

Top practical tip

Write several candidate propositions in the customer’s language, then test what people understand, believe and prefer. Keep the claim that matters, differs and can be proved—and remove every word that does not strengthen it.

Top pitfall

Do not choose a promise the operating model cannot consistently deliver, or a generic adjective any competitor can claim. A USP that fails in the customer experience accelerates disappointment rather than differentiation.

Further reading

• Reeves, R. (nineteen sixty-one). Reality in Advertising. Knopf.
• Ries, A. and Trout, J. (nineteen eighty-one). Positioning: The Battle for Your Mind. McGraw-Hill.