How to Differentiate Your Software Value Proposition From Competitors

December 15, 2021
Contributor: Amita Jain

Follow these three simple steps to highlight what sets you apart from the competition.

Every software category has a multitude of providers with similar offerings. And most of those tools can look the same to a prospective buyer doing a cursory review. 

But, a properly crafted value proposition can differentiate your offering from products that otherwise appear to be equal to in-market buyers. For example, if you are an HR software provider, you have to navigate a crowded marketplace with thousands of competitors. How can you stand out in your category and get your fair share of buyer attention?

A well-formulated software value proposition and effective brand messaging can be the most important selling tool for your marketing and sales departments. It can quickly engage your prospects and clearly distinguish you as a unique SaaS provider. 

What is a value proposition and why is it so important?

A value proposition is a sum of value (or benefits) that a buyer will receive from your goods and services upon doing business with you.

When buyers are researching so much before interacting with you, a vague message about your product can lead them to miss the full story about your brand. A compelling value proposition, however, when webbed across marketing, sales, and customer success messaging, reinforces the importance and ROI of your product.

Gartner Digital Markets’ research shows that nearly four out of 10 (39%) software buyers selected a vendor for their most recent purchase due to its value proposition (price vs. benefits).

So, how do you create a differentiated value proposition for your software business? Follow these three best practices to effectively articulate your SaaS value proposition.

1. Understand what the buyers want to know

“We are better because ...” isn't the best starting point to formulate your value proposition. 

The problem with this approach is it has little regard for the target audience’s needs and their buying challenges, and focuses too much on what the company offers. It assumes buyers have fully identified their needs and requirements before coming in contact with your brand touchpoints.

This leads to a value proposition that only provides information about the product, without giving clear insights specific to the target audience. 

Differentiating your value proposition goes beyond just speaking about your software and services.  It needs to start with you understanding your software buyers’ priorities. During the first stage of the software buying journey, the awareness stage, buyers recognize that there is a gap, a problem, or an untapped potential that can be addressed through software.

An important element of differentiation is to understand: what information your audience is looking for (e.g., case studies, explainers, technical descriptions, software features or use cases), why they are searching (e.g., to save money, or for a better workflow), when they are looking for it (what stage of the buying journey they are at), and then placing those answers where they are spending the most time researching.
Answer these questions in your value proposition to better connect with your audience:
 
  • Why change? Articulate the business value they can achieve by doing something differently. 
  • How to change? In addition to product information, give context on the key requirements for change and how your solutions can support a successful transition. 
  • Who to change with? Make your prospects comfortable with your advice and suggestions by providing authentic and helpful information that helps them reach an optimal outcome. Show them you care about their needs.
Pro tips to inform value proposition with buyers’ needs:
 
  • Collaborate with sales. Partner with the sales team to know when, how and why buyers interact with digital touchpoints. Do an audit of competitor and third-party content. Analyze the data to understand buyers’ pain points and which features they're looking for.
  • Segment your audience. Divide your user groups into categories based on firmographic data, interest, geography and behavior to create a clear vision of your buyer personas and craft unique value propositions for them.
  • Give buyers more control over their purchase decisions. Modern B2B buyers need coaches who can help them through complex purchase activities, rather than processes that sabotage their decision making. Avoid pushy marketing messages and give prescriptive help where it can give value to the buyers.

2. Demonstrate value in your messaging

A value proposition primarily raises two questions: why buyers should buy from you instead of the competition and — importantly — why they must do anything at all.

The former focuses on the concrete value your solutions provide that’s hard to find elsewhere: good customer care, an integrated suite of applications for smarter processes, competitive pricing and glowing customer reviews, among others. 

The latter is a source of emotional appeal to the audience's decision-making faculties, and it’s often overlooked. Most propositions concentrate on what a product does and its benefits. An effective software value proposition focuses on the customer problem it solves, not just positive results. 

Here are some ways to improve your messaging to articulate a clear value proposition. 
Do’s when communicating your software value proposition:
 
  • Do appeal to emotions, not only logic, by highlighting the problems your software solves.
  • Do represent your unique positioning to solve certain problems.
  • Do show your value propositions at every buyer touchpoint.
  • Do make a strong case for changing buyers’ habits and persuading them to do something differently.
  • Do use customer success stories and other use cases to provide a roadmap of where customers are now and what better outcomes they can reach.
Don’ts when communicating your software value proposition:
 
  • Don’t craft vague or confusing value statements with no context around your product or service.
  • Don’t place the information too far down on the page. 
  • Don’t create contradictory messaging on different marketing and communication channels.

3. Shape your messaging with the channel

In a digital buying experience, buyers value software providers that can make the purchase decision easier to navigate. 

As you zero in on your SaaS value proposition and integrate it across your marketing and sales communications, tailor your messages for buyers at different stages of their purchase journey.

Don’t refrain from customizing information for key personas in the software buying team, in fear of it limiting your audience. Generic messages in this hyper-digitalized era lead to content gaps and misaligned messaging, which impacts lead generation.

Look at what influences buying decisions and customize your message accordingly to the channel or audience. Here are some tips to tweak your software descriptions and value proposition messaging.
Pro tips to shape your value messaging across different channels:
 
  • Redesign your messages by using findings from the digital buying journey of previous customers. Show you have walked a mile in buyers’ shoes by tailoring messages on your website, product profile, social media platforms, review videos and email campaigns to the purpose for which users navigate these channels. Anticipate and answer their queries and connect your solutions with your value proposition.
  • Create compelling and relevant buyer enablement content. Buyer enablement content helps buyers complete complex buying jobs and move further along in the purchase funnel. Use tools such as an evaluate and compare option, spreadsheets, and other marketing materials, and place them at touchpoints where buyers find it most useful. 
  • Curate a library of messages linked to different value propositions. Create relevant messaging elements, such as a call to action (CTA), for each buyer’s pain point, and link them to your value propositions. It will help sales teams compose tailored messages at scale with a granular focus on user needs.
  • Integrate your value proposition with brand awareness and demand generation programs. Make all your communication circle back to your value proposition–from ebooks and infographics to videos, demos, and customer calls. It will create message consistency and enhance the user experience by delivering consistent promises throughout the buying journey.

Finely crafting software value propositions is not formulaic; there are no fill-in-the-blank templates and no one-size-fits-all solutions. As long as your value propositions are persuasive, help prospective buyers and open up sales conversations, they are a winning bet for you.

Claim your profile on Gartner Digital Markets and reach in-market buyers actively searching for the right software and services to fit their needs.

Amita Jain

Amita Jain covers B2B content creation and strategy to help businesses reach their marketing goals. She received her master’s degree from King’s College London, U.K. Exploring the world of art and reading fiction are some of her usual happy distractions outside of work. Connect with Amita on LinkedIn.
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