Defining Your Unique Value Proposition:

Differentiators That Set You Apart

I wanted to expand on the Fourth question that every founder needs to ask themselves ( for a deep dive into other question(s) in this series please subscribe to my blog)

The question is:

What unique benefits does my value proposition offer that set me apart from competitors? Sometimes it may not need to be too unique in all the aspects of the value proposition, just one or two differentiators is enough. For example, in a market where everyone can deliver food at home, freshly made warm meals allowed for Uber to become an easy differentiator.

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Let’s dig in:

As a founder, offering a product or service that works isn’t enough. You need to ask yourself: What unique benefits does my value proposition offer that set me apart from competitors? It’s a crucial question because, in many cases, standing out doesn’t mean reinventing the wheel—often, one or two key differentiators are enough to make a significant impact.

As James Clear said, “Being different beats being better” But how do you find that difference?

Differentiation is a superpower

When you think about differentiation, it’s easy to get caught up in the idea that your entire value proposition needs to be unique. But in reality, that’s rarely necessary. Sometimes, it only takes one or two strong differentiators to set you apart from the crowd. For instance, in a saturated market like food delivery, companies like Uber Eats found success not by offering something entirely new, but by introducing a crucial differentiator: delivering freshly made, warm meals.

This small yet impactful distinction created a point of differentiation in a market where many competitors already offered home delivery. Focusing on a single aspect of your value proposition can make all the difference.

What Is Your Unique Value Proposition?

A unique value proposition (UVP) is the concise articulation of how your product or service benefits your customers in ways your competitors can’t. It’s the promise of what your product will do for them and what makes that offering distinct.

To develop your UVP, you need to start with a solid understanding of what makes you different from your competitors. This difference doesn’t need to be radical—it just needs to be meaningful to your customers.

Steps to Identify Your Differentiators

Let’s explore how to uncover the unique benefits that form the foundation of your value proposition.

1. Identify Your Core Strengths

Start by asking yourself, What are we good at? The first step to identifying your differentiators is recognising your company’s core strengths. Are you offering a product that solves a problem more effectively, more affordably, or faster than anyone else? Is your customer service more attentive? Do you have an innovative feature that others don’t?

Your strengths are the building blocks of your UVP.

Actionable Step: Make a list of the core strengths of your product or service. Highlight the top two or three that are most important to your customers. These should be strengths that your competitors either don’t offer or don’t excel in.

2. Research Your Competitors’ Weaknesses

To stand out, you don’t need to be different in every way—just in the ways that matter most to your customers. One of the best ways to identify these opportunities is by understanding your competitors’ weaknesses. Look for gaps in their offerings, areas where customers are dissatisfied, or services they overlook.

For example, a competitor might have a fantastic product but struggle with slow delivery times. If you can improve upon this, your faster delivery could become the differentiator that sets you apart.

Actionable Step: Conduct a competitor analysis. Look at customer reviews, feedback, and market reports to identify common complaints or gaps in their offerings. Use this information to see where you can fill in the gaps or outperform them in one specific area.

3. Focus on Customer Experience

It’s about how you offer it. In many cases, the differentiator lies in the customer experience rather than the product itself, as a friend called it being “betterer”. This could be through better customer service, more convenience, or a smoother buying process. Customers often choose companies that make their lives easier, even if the product itself is similar to others on the market. Hard to grasp, remember it next time you are paying triple the price of a bottle of wine at a fancy restaurant. It is not the wine but the service you are paying for including the fancy soap in the toilet.

Think about how your customers experience your product from start to finish. What can you do to make their experience better, faster, or more enjoyable?

Actionable Step: Map out your entire customer journey. Look for touchpoints where you can differentiate through customer experiences, such as more personalised service, faster response times, or more intuitive interfaces. Focus on creating a seamless and pleasant experience that sets you apart.

4. Look for Emotional Differentiators

While functional benefits are important, emotional differentiators can be incredibly powerful. Customers often make decisions based on how a brand or product makes them feel. For example, Nike doesn’t just sell athletic shoes—they sell empowerment and inspiration through the “Just Do It” philosophy.

Those who stand for nothing, fall for anything"

Alexander Hamilton

Ask yourself: What emotional response does my product evoke? Does it make customers feel confident, secure, or more productive? Tapping into these emotional differentiators can help create a stronger connection with your audience.

Actionable Step: Revisit customer feedback to see how your product impacts their emotions. Use this data to inform your messaging and highlight the emotional benefits alongside the practical ones. A Google search can tell you a lot more.

5. Test Your Differentiators with Your Audience

Once you’ve identified your key differentiators, it’s time to test them. You may think you’ve found the perfect way to set your brand apart, but without customer validation, it’s just a guess. Testing your UVP with your target audience ensures that your message resonates and your differentiators are compelling enough to influence buying decisions.

Actionable Step: Present your value proposition to a sample of your target market and ask for feedback. Are your differentiators clear? Do they find these benefits valuable? Use their feedback to refine your UVP before rolling it out more broadly. Would they be willing to pay for having this differentiator.

When Differentiation Isn’t Necessary

There’s also the possibility that the market you’re entering doesn’t need a radical differentiator. In some cases, being able to deliver on the basic expectations—like providing quality service at a fair price—can be enough. But even here, small details can set you apart, like a faster checkout process or offering a better return policy.

In competitive markets, however, having even a small edge can make a huge difference. As Seth Godin points out, “In a crowded marketplace, fitting in is failing. In a busy marketplace, not standing out is the same as being invisible.”

One Strong Differentiator Can Be Enough

Your value proposition doesn’t need to be unique in every aspect. Sometimes, it only takes one or two key differentiators to set you apart from your competitors and create a compelling reason for customers to choose you.

Whether you’re focusing on a specific feature, a better customer experience, or an emotional connection, the goal is to highlight what makes you stand out. In the end, it’s about being different in the ways that matter most to your customers.

By carefully identifying and testing your unique value proposition, you’ll carve out a space for your business in the market and build a loyal customer base that values what you bring to the table

This topic is an expanded article from my book THE ‘BENEFIT’ BLUEPRINT FOR STARTUP SUCCESS Chapter 3, Question 4.

© Sameer Babbar

Sbabbar@sameerbabbar.com

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Disclaimer: This is for information only. It does not take into account your objectives, financial situation, or needs. The author, his company, his associates, his directors, his staff, his consultants, and his advisors do not accept liability for any loss or damage, including, without limitation, any loss that may arise directly or indirectly from the use of or reliance on the information provided