In marketing, the term USP (Unique Selling Proposition) describes a value proposition that sets a product or service apart from similar products or services from competitors. This unique selling point is the decision criterion as to whether the customer will buy the product or the service. A USP is intended to convince customers to buy a certain product because of the advantages or to change the brand.
The American advertising specialist Rosser Reeves introduced the English expression Unique Selling Proposition as a unique ” sales promise ” for a product or service in 1940. Due to the increasing competition, a product should have a certain unique selling point so that it stands out from other products of the competition. This mostly concerns a specific property that other products do not have or do not claim for themselves. The target group addressed should thereby prefer the advertised product and ultimately buy it.
Benefit from USP
According to photionary.com, most of the products are interchangeable in almost all market areas. If two products differ only in name and packaging, in most cases the customer simply buys one without thinking about it. Therefore, companies have to convey to the customer why their own product or service is the right choice. The company’s aim here is to set itself apart from the competition with a USP. This gives the customer the feeling of receiving a special product or service. A USP plays an important role in marketing as it has a direct impact on sales successof the company has. A USP determines both the price and the special properties of the product, which differ from others. These advantages are unique for the customer, which is why he usually decides to buy.
When defining a product or service, the following terms are used in marketing:
- Basic benefit: This represents the basic benefit that a customer has from a product or service. The basic benefit is the same for all products of one type.
- Additional benefits: An additional benefit that does not offer any product which, however, is not a unique selling point over competing offerings.
- USP: Unique sales promise that no competitor offers.
Requirements for USPs
Since a USP should have an effect in the long term and lead to success, three aspects must be considered:
- The imitation plays an important role. Therefore, a USP should not be copied with little effort (defense capability).
- The second requirement for a unique selling proposition is the target group. With targeted analyzes, a company can determine which properties potential customers consider decisive even before product development. This avoids a USP that does not take into account the needs of the target group.
- Another aspect is the cost. USPs must not incur excessive costs so that they are profitable in the long term.
There are USPs for every product and service as well as for every company. These always represent added value that the competition cannot offer. Therefore, a USP should be made clear to the potential customer before the purchase decision is made; this is usually done through appropriate advertising. For example, companies can use concise slogans that are recognizable.
The following properties are available for a USP:
- An innovation represents a major unique selling point. This can be, for example, a new technical property, recipe or material of a product.
- USP quality is a common trait. This can be illustrated with test results (e.g. Stiftung Warentest) or experts who are used as a quality promise. For example, when a well-known chef advertises kitchen utensils, the consumer directly associates professional quality that is different from other products.
- Service can also be used as a USP. The customer is often faced with a choice between several products. This is where service can make a difference. A unique selling point is, for example, German-speaking support, a 24/7 hotline or a long exchange guarantee.
- The price is the decisive argument for buying for many customers. The best price guarantee for a product, unusual discounts or one-off promotions are successful measures to represent a USP. Conversely, however, a high price can also stand for a special quality, which is particularly suitable in combination with a quality feature or personal service.
- The exclusivity of a product can have a positive effect on sales. In addition to the high price, a special edition can also be the unique selling point.
- The time saving is important in today’s time and can therefore be used as a USP. Fast shipping is just as possible as a shop for buying groceries online.
USPs can clearly lead to greater demand for the products or services and are therefore a common marketing measure. Due to the numerous possible USPs, a detailed target group analysis is essential in order to then focus on a USP in the corresponding marketing campaigns. For the long-term success of the USPs, in addition to the orientation towards the respective target group, defense capabilities and costs are important aspects. With appropriate advertising measures, a company can effectively demonstrate its unique selling proposition, which increases demand and thus sales.