Unique Selling Proposition (USP): What it is, Types, Tips on How to Formulate It, and Real Examples
In order to stand out in the market among competitors, organizations need to understand their unique selling point and effectively formulate their unique value proposition.
In this article, we will explore the concept of USP, its advantages and disadvantages, types and principles. You will also learn how to skillfully craft a value proposition, and to reinforce the material, we will provide illustrative examples.
What is USP
Unique Selling Proposition (USP) is an advertising positioning that highlights the distinctiveness and competitive advantage of a company's products or services. It is essentially the uniqueness of your brand that sets you apart from others. A USP has three important characteristics:
Uniqueness: There is no similar product available from other companies.
Specificity: "The most stylish clothing" does not meet the criteria of a USP, but "Yoga apparel" is more specific.
Relevance to customer needs: Your proposition should satisfy customers' desires. Excellent examples of unique selling propositions are the slogans of Snickers candy bars: "Don’t just take a break, take a Snicker." and Sprite carbonated beverages: "Obey your thirst!" Both propositions are memorable to customers and help them understand which needs are being satisfied: a sweet peanut bar satisfies hunger, while a carbonated drink refreshes in hot weather.
How USP differs from positioning, offer, and company slogan
Now let's clarify the differences between USP and other similar terms.
Positioning is a broad concept that encompasses the organization's goals and mission. It aims to create a positive image among people but does not necessarily motivate immediate product purchases.
An offer is a clear proposition that provides benefits to customers and usually operates for a specific period. Sometimes an organization may have multiple offers based on changing conditions or company desires. Your competitors may adopt similar offers for themselves.
To better understand the distinction between USP and other definitions, let's examine positioning, unique selling proposition, and offer using the example of an online workout platform.
Positioning – PWR zero equipment.
USP – 25 minute workouts. Body weight only. Plus 15 minute optional express workouts.
Offer – Free trial, then $19.99 on a monthly plan.
An example of positioning, USP, and offer
A slogan is often a short memorable phrase that grabs attention and reflects the essence of a company. Sometimes it incorporates USP criteria. Slogans may be absent in some organizations, primarily used by big brands, whereas USP should be present in any business regardless of its scale.
USP: pros & cons
Advantages of USP
Market popularity: USP helps customers learn about a product or service from a positive perspective. This increases the likelihood that they will become your customers.
Lack of competition: USP allows customers to evaluate a product not only based on its price but also its value. It's important to consider the benefits customers will receive, even if they pay more than for a similar product from another brand.
Word-of-mouth advertising: When a large audience becomes aware of the uniqueness of your product, it increases your chances of attracting repeat customers. They can motivate their friends and acquaintances to make a purchase.
Disadvantages of USP
High competition: In today's world, it's challenging to stand out in the market among numerous original brands. Many products in different niches already have demand due to their important and unique features.
Misalignment with expectations: It's important to remember that your product claims should align with reality; otherwise, you may trigger a negative reaction from consumers. For example, if you notify a customer of home delivery within 30 minutes but fail to fulfill it due to certain reasons, it can lead to a disappointed customer and a tarnished reputation in the market.
Types of USP
There exist two types of USP:
- Genuine. This category includes products that truly possess exceptional qualities and significantly differentiate themselves from competitors in the market. Let's consider a couple of examples.
Saddleback Leather is a company known for its slogan that captures attention: "They'll fight over it when you're dead." It reflects the USP of the company and highlights the exceptional quality and durability of their leather products, emphasizing that they are built to last for generations, becoming cherished heirlooms in the future.
Another example is Muse, a leading company in the field of brain-sensing headbands, offering a unique and innovative solution for mindfulness and meditation. Their USP lies in their advanced technology that enables users to track their brain activity and achieve a deeper level of relaxation and focus, setting them apart from traditional meditation tools and providing a personalized meditation experience. With Muse individuals can elevate their mindfulness practice and unlock their full potential for personal growth and well-being.
- False. This type of USP is created artificially. It is often used when there is high competition in the market.
Death Wish Coffee has successfully positioned itself in the market by claiming to offer "The World's Strongest Coffee." This tricky USP creates intrigue and curiosity among coffee enthusiasts, attracting those seeking an intense caffeine experience. By leveraging the USP of extreme strength, Death Wish Coffee effectively stands out from competitors and appeals to consumers who crave a bold and powerful coffee experience.
Principles a USP to be built
Audience orientation: The USP is crafted based on the interests, values, and needs of the target audience. Failing to consider this criterion may lead consumers to choose a different brand.
Originality: The offered benefit should be distinctive and unique. It is crucial for your uniqueness to be genuine; otherwise, it may result in negative feedback.
Value: The USP should deliver tangible or intangible benefits to potential customers, providing them with either material or emotional advantages.
How to create a USP
To craft an effective USP, it's important to study your audience and identify what they are lacking. Let's break down how to do it step by step.
Stage 1: Gather information and analyze it
At this stage, find out what solution customers expect from your product. The following methods are suitable for gathering information:
- Interviews and surveys
Conduct online or in-person interviews with individuals from your target audience who have similar interests and goals. The more participants, the better.
- Social media monitoring
Explore relevant groups, communities, and read user comments, posts, and competitor news.
- Marketing analysis
You can opt for professional marketing agencies, purchase ready-made reports, or conduct your own analysis using the previous methods.
To study your customers, you don't necessarily have to spend financial resources; conducting interviews or surveys is sufficient. It's important to note the specificity of the questions: ask only what will be meaningful in the future. For example, inquire about what customers dislike the most about competitors' products. Avoid generic questions like, "Do you like our product?"
Your goal is to identify the problems or concerns that customers face when making a purchase. They may sound like these:
"It's impossible to find the right size; I've been trying to find jeans that fit my figure, but it's nearly impossible."
"The prices of healthy food products are too high."
"I enjoy acrobatics, but I have doubts because I lack experience."
Stage 2: Creating a customer profile
After completing the previous step, proceed to create a detailed description of your typical customer. Try to gather as much information as possible about their interests, goals, and problems. Don't focus solely on general attributes like gender, age, location, etc.
Examples of customer profiles:
Individuals with specific body characteristics who struggle to find suitable clothing items.
Young people (students, schoolchildren) who aim to eat healthily and maintain a healthy lifestyle.
People who have an interest in acrobatics but have fears about starting from scratch or concerns about getting injured. They may think that practicing this sport is only possible from a young age.
Stage 3: Competitive analysis
Find out what offerings your competitors have and how they position themselves. It's also important to keep in mind the actual desires of the consumers, as companies often forget the most important aspect – satisfying the customer's needs with their products.
Stage 4: Brainstorming
Generate several statements and test which ones work best. Formulate hypotheses on how to address consumer problems while standing out in the market. For example:
"We will help you find the right size with a free consultation from our knowledgeable sales consultants who have an excellent understanding of our entire range and will find a suitable option for you. If your size is not available, it can be ordered."
"In our healthy food store, there are daily promotions on a specific 'product of the day' where you can purchase it at a discounted price."
"Free trial session with a professional trainer. Let's dispel myths and fears. It's never too late to start."
Stage 5: Hypothesis testing
Test your unique propositions on customers:
Try running a couple of advertising campaigns and compare the results. This can be done on social media platforms without significant financial investment.
Conduct interviews and find out from consumers if they are attracted to your propositions.
Analyze the results obtained and make changes to the hypotheses if necessary. If the propositions are not effective, return to the previous stages.
For example, the case of a healthy food store can be like this:
The company conducted a survey on social media, asking if students and schoolchildren would purchase products if there were daily promotions on a specific "product of the day."
Customers responded that this proposition does not satisfy them as they do not know which specific item will be on promotion.
The store came up with a new offer: discounted days with a 15% discount on all products for schoolchildren and students (e.g., Mondays and Fridays).
The survey indicated that this proposition was much more appealing to the target audience.
Tips for crafting a USP
The following ready-made formulations can help you in creating your unique proposition:
"Product without…"
Here, a component that evokes fear in customers should be absent: without sugar, without GMO, without lactose, etc.
"If…, then…"
This formula works well and provides a certain guarantee to the customer. For example, "If you are not satisfied with the product, we will refund your money."
"A typical product with an additional benefit"
This benefit should be based on the needs of your target audience. For example, anti-dandruff shampoo or toothpaste for sensitive teeth.
"A product with a special feature"
This formula implies uniqueness in the product's properties. For example, "Florist course with subsequent job placement."
Mistakes in formulating a USP
When creating a USP, it's important to avoid the following common mistakes:
Lack of uniqueness in the offer. If an organization cannot offer a distinctive product, customers will not be interested in the offering. There are other companies that offer similar products, and customers may turn to them. Therefore, when formulating your unique selling proposition, it's important to study the properties of similar products and what competitors are offering.
Using typical clichés. There are phrases that do not attract customers because they are used by many companies. For example, there are benefits that consumers do not perceive or notice because everyone is using them. Examples include "Best deals" or "Fast delivery." If an organization still uses these formulations, it's important to add additional characteristics and clarifications, such as "Fast delivery in 30 minutes, or we'll give you the order for free."
Ignoring the target audience. Sometimes a USP emphasizes the product's merits but fails to consider the desires of consumers. For example, a USP like "An innovative washing machine that can quickly wash your clothes in just 15 minutes" has a rather generic formulation and doesn't take into account the specific interests of the audience. However, a USP like "Did your kids make a mess of their clothes? No problem! Our washing machine with a unique mode can wash clothes in just 15 minutes, helping you save time!" is directed towards parents who have limited time for household chores.
Real examples of UTP
ThirdLove
The slogan of the lingerie company ThirdLove "You know your body, we know your fit" highlights the company's expertise in providing the perfect fit for each individual customer. With this USP, the company emphasizes their understanding of diverse body types and their commitment to offering lingerie that complements and enhances the natural beauty of every customer. The benefits for customers include the assurance of finding lingerie that fits them perfectly, enhances their comfort, and boosts their confidence, allowing them to embrace their unique body shape and feel their best.
Arch Motorcycle
Arch Motorcycle, co-founded by Keanu Reeves, offers personalized, hand-built motorcycles that showcase exceptional craftsmanship and advanced engineering. Their unique selling proposition lies in delivering a tailored riding experience, where each bike reflects the owner's individual style and preferences. Reeves's involvement adds appeal and attracts enthusiasts who appreciate the blend of iconic design, superior performance, and the influence of a renowned actor.
Canva
The USP of Canva's products lies in their robust and intuitive design platform, offering individuals and businesses a comprehensive toolkit to create professional-grade graphics and visual content. With a vast library of customizable templates, extensive design elements, and seamless collaboration features, Canva empowers users with the ability to produce visually compelling materials efficiently, regardless of their design expertise. By simplifying the design process and democratizing access to high-quality design resources, Canva sets itself apart as a valuable and indispensable tool for effective visual communication.
Patagonia
Patagonia's USP centers around its commitment to environmental sustainability and ethical practices. As an outdoor clothing and gear company, Patagonia goes beyond providing high-quality products by actively promoting environmental conservation, fair trade, and social responsibility. With initiatives like using recycled materials, supporting grassroots environmental movements, and encouraging responsible consumption, Patagonia attracts conscious consumers who align with their values and seek products that make a positive impact on the planet and society.
HubSpot
HubSpot's USP lies in its comprehensive inbound marketing and sales software platform. With a suite of integrated tools, HubSpot enables businesses to attract, engage, and delight customers by offering a seamless customer experience throughout the buyer's journey. By providing powerful features such as CRM, marketing automation, content management, and analytics, HubSpot empowers organizations to optimize their marketing and sales efforts, drive growth, and build strong, lasting customer relationships.
Patch
Patch company distinguishes itself through its exceptional USP, which revolves around revolutionizing plant care and offering sustainable gardening solutions. By combining innovative techniques with a commitment to simplicity and convenience, Patch provides a carefully curated assortment of premium indoor plants, along with expert guidance and continuous assistance, enabling customers to effortlessly bring the beauty of nature into their homes while promoting environmentally-friendly practices.
Zoom
Zoom stands out with its unique USP as a leading video conferencing platform that offers seamless and reliable virtual communication solutions. With its user-friendly interface, high-quality video and audio capabilities, and robust features like screen sharing and recording, Zoom empowers individuals and businesses to connect, collaborate, and communicate effectively across distances. Its scalable and versatile platform caters to various needs, making it a preferred choice for remote meetings, webinars, online events, and virtual classrooms, delivering a seamless and immersive communication experience.
Conclusion
A Unique Selling Proposition (USP) is the distinctive features of a product that captures the attention of customers. The main advantage of a USP is its ability to enhance competitiveness in the market through the uniqueness of the product and the benefits customers gain from it. This could involve solving a specific problem, providing comfort, creating a certain status, and more.
To formulate a unique proposition, it is essential to identify the target audience and segment it accordingly. Then, analyze each segment to determine which product features address their problems. By highlighting the unique qualities of your product, you can craft a compelling USP. For those who find this process challenging, ready-made USP templates can be helpful.
When creating a USP, it is important to avoid the following mistakes:
using fictional product characteristics
relying on clichés like "best prices"
ignoring the problems of the target audience. Your product should primarily help customers solve their problems and fulfill their needs.