The discussion sparked by Andy Lark's recent post set me thinking about PR value propositions.
Back in March, Harvard Business Review ran a piece entitled Customer Value Propositions in Business Markets (its $6 to download the full article).
It contained some pertinent comment on where companies go wrong in trying to develop their value proposition - and highlighted why the PR industry is currently struggling to articulate its own value.
For example:
Most managers, when asked to construct a customer value proposition, simply list all the benefits they believe that their offering might deliver to target customers. The more they can think of, the better. This approach requires the least knowledge about customers and competitors and, thus, the least amount of work to construct. However, its relative simplicity has a major potential drawback: benefit assertion. Managers may claim advantages for features that actually provide no benefit to target customers.
Take a look at most PR agency websites - if you removed reference to the company name and logo, and asked people to identify the agency simply based on the stated value propostion, most people would be hard pushed to name a single agency. And before anyone starts mentioning pots and kettles, I know we are as guilty of this as anybody - hence why we are spending time on better refining our value propostion.
Favorable points of difference: The second type of value proposition explicitly recognizes that the customer has an alternative. "Why should our firm purchase your offering instead of your competitor's?" is a more pertinent question than "Why should our firm purchase your offering?"
Prospects are spoilt for choice at the moment - with such little differentiation in the market at the moment and with PR companies desparate for new business and prepared to offer loss making discounts, the danger is that PR is turning into price-led commodity business. And many clients may soon realise that much of what some agencies offer, they could do themselves, even more cheaply.
Resonating focus: [Customers] want to do business with suppliers that fully grasp critical issues in their business and deliver a customer value proposition that's simple yet powerfully captivating. Suppliers can provide such a customer value proposition by making their offerings superior on the few elements that matter most to target customers, demonstrating and documenting the value of this superior performance, and communicating it in a way that conveys a sophisticated understanding of the customer's business priorities.
This echoes Andy Lark's desire for agencies who "get" their clients business. Yet how many PR companies have really developed a value proposition that is "simple yet powerfully captivating?
On the subject of what are the critical issues for tech marketing directors at the moment, a quick straw poll reveals one stand out item - lead generation. The tech industry remains relentlessly driven by quarterly sales targets. Show a marketing director a quick and easy way of increasing qualified sales leads and you have their undivided attention. The problem for PR is that it is the one aspect of the marketing mix that is the most difficult to measure in terms of its true impact on lead generation - it is better suited to the longer term development of a company's influence and reputation - unfortunately, short terms demands lead prospects to look to those who claim they can offer a short term solution - could it be that PR companies in their desparation to win business are making promises they can't keep in terms of their ability to make a major impact in a short timeframe? That would explain the price discounting and overservicing.
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