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Like any other company, Beaches, an all-inclusive chain of resorts for families, must explain what its value
proposition is to customers. In other words, why does a Beaches resort provide more value to vacationing families
than do other resorts?
Source: Wikimedia Commons.
Firms typically identify different target markets, or groups of customers, they want to reach when they
are developing their value propositions. Target markets will be discussed in more detail in Chapter 5
"Market Segmenting, Targeting, and Positioning". For now, be aware that companies sometimes develop
different value propositions for different target markets. The value proposition tells each group of
customers why they should buy a product or service, vacation to a particular destination, donate to an
organization, and so forth.
Once the benefits of a product or service are clear, the firm must develop strategies that support the value
proposition. The value proposition serves as a guide for this process. In the case of our sales consulting
firm, the strategies it develops must help clients improve their sales by 30–50 percent. Likewise, if a
company’s value proposition states that the firm is the largest retailer in the region with the most stores
and best product selection, opening stores or increasing the firm’s inventory might be a key part of the
company’s strategy.