A product is not a proposition. So why do so many people mix the two up? | DMA

Filter By

Show All

Connect to


A product is not a proposition. So why do so many people mix the two up?


When I started out in work as a fresh faced graduate, 22 odd years ago, it was all about product. Sell as many products as you can and the numbers will take care of themselves

There were 2 main elements of the marketing mix that mattered - product and price and so long as the communication was broadcast, then very little else was needed. Customers had little/ zero choice; barriers to entry were at all time highs so those who shouted the loudest got the best returns.

I was lucky enough to launch a number of new products when I started work on the graduate scheme for NatWest, products which still exist today. Little chat was about the customer and that was the way it was and that was the way it had always been (my son).

Fast forward to now and product is not the only piece in the equation that is important. There are others that have equal or increased weighting and its all of these elements that when added together make a proposition where the sum of the parts outweigh the individual elements.

A proposition can be summarised in the diagram below which I call My pint of Guinness.

Product and price are essential but so is the service wrap that you offer, who and how you distribute, the look and feel of the product/ service, how it is communicated and the social participation to drive referral, word of mouth and trust. Add in the company's brand and an overall Customer Value Promise and you have all the elements of a proposition.

Propositions only work best when the customer is at the heart of the discussion - who is the target audience; how big is the addressable market; is it possible to win; how are we viewed as a brand; what are the barriers to entry and how would our prospective customers like us to talk to them.

How a proposition differs from a product - My pint of Guinness model

When I started at O2, we had a very clear Customer Value Promise - 'More for More'. Those customers who spent more with us got more from us as a thank you. Whether that be early upgrades where all our existing customers received a better deal than our new customers - more minutes/ texts/ data; a higher number of inclusive Bolt Ons as part of their package; more chances to win tickets to The O2.

The O2 brand stood for quality and premium in the target market's eyes and all elements of the marketing mix came together to bring this to life. We smashed every commercial metric we aimed for as the halo impact was so much more than 'just' selling a handset at £99.99.

In my opinion and experience, there are a thousands of company folk who mix up the terms. In reality, very few companies really develop propositions - those that do - easyJet, Greggs, John Lewis, Under Armour, English Premier League, NOW TV see the biggest returns and shareholder satisfaction.

Start with the customer and the insight and then think outwards rather than start with the product and how you will price it. There is much more value in thinking broader that your analysts, shareholders and work colleagues will thank you for.

Hear more from the DMA

Please login to comment.