In marketing, the unique selling proposition (USP), also called the unique selling point, or the unique value proposition (UVP) in the business model canvas, is the marketing strategy of informing customers about how one’s own brand or product is superior to its competitors (in addition to its other values).
It was used in successful advertising campaigns of the early 1940s. The term was coined by television advertising pioneer Rosser Reeves of Ted Bates & Company. Theodore Levitt, a professor at Harvard Business School, suggested that, “Differentiation is one of the most important strategic and tactical activities in which companies must constantly engage.” The term has been extended to cover one’s “personal brand”.
A unique selling proposition (USP) refers to the unique benefit exhibited by a company, service, product or brand that enables it to stand out from competitors. The unique selling proposition must be a feature that highlights product benefits that are meaningful to consumers. USP focuses on explicit claims of uniqueness involving an objectively verifiable product attribute or benefit-in-use.
- Each advertisement must make a proposition to the consumer—not just words, product puffery, or show-window advertising. Each advertisement must say to each reader: “Buy this product, for this specific benefit.”
- The proposition must be one the competition cannot or does not offer. It must be unique either in the brand or a claim, the rest of that particular advertising area does not make.
- The proposition must be strong enough to move the masses, i.e., attract new customers as well as potential customers.
Differentiation is the company or product attribute that separates you from competitors. A unique selling proposition makes your differences clear to prospects and compels them to give your brand strong consideration. Without a USP, you allow the prospect’s buying decision to become very arbitrary. In such cases, the low price often wins out. Unique features, quality materials, better style, elite service and brand reputation are common attributes on which a company creates a USP.
When you offer a unique selling proposition and prospects clearly see it, your revenue typically improves or exceeds expectations. People buy the product or service that best matches their needs, and that offers the best combination of benefits and price. The more significant your USP, the greater your potential revenue advantage. Discerning prospects may pay top-end prices for a reputable brand with materials they view as the highest quality or most durable.
When you promote a USP and deliver an appealing value proposition, buyers are likely to return for a future need. A buyer may look to repeat a car purchase with the same dealer or sales rep after getting a great deal previously. Each repeated, positive experience contributes to budding favorable sentiment. At some point, repeat purchases evolve into feelings of loyalty to your business. Loyalty strengthens the bond, gives you some wiggle room on mistakes, allows you opportunities for growing revenue and drives referral sales.
Sales representatives benefit when companies develop and offer a compelling unique selling proposition. It is easier for a salesperson to genuinely convey value when he recognizes it himself. When a rep struggles to see value himself, he may feel unethical about pushing benefits or persuasive messages on unsuspecting prospects. If the salesperson uses the brand himself, it becomes even easier for him to passionately and persuasively sell value to prospects.