How a Unique Selling Proposition (USP) Helped GEICO, Fedex, and Domino’s Rise as Market Leaders
Here’s our framework for creating USPs, step-by-step.
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What sets you apart from every competitor fighting tooth-and-nail for your customer’s attention and wallet?
Is it your…
Those are all valuable. But well-funded competitors can replicate, imitate, and knocked off ALL those qualities with ease.
Your customers already feel overwhelmed with options. Knowing what sets you apart from the competition will help you rise above the noise and make more sales.
So what is it that customers want from you that is nigh impossible for competitors to steal? That answer to the age ole’ question, “What do you do better than anybody else (or any startup) in the world?”
Three words: unique selling proposition. (Or “USP” for short).
Legendary ad executive, Rosser Reeves, was famous for advertising with USPs. He was the genius behind ad campaigns like:
Many ad agencies thought Reeves’s ads annoying. Yet Anacin sales increased in 18 months from $18 million to $54 million. (Source) And many of his other ads generated massive growth.
How did Reeves define the USP? He put it this way when he coined the term back in 1961:
“1. Each advertisement must say to each reader: ‘Buy this product, and you will get this specific benefit.’”
“ 2. The proposition must be one that the competition either cannot or does not offer. It must be unique, either a uniqueness of the brand or a claim not otherwise made in that particular field of advertising.”
“ 3. The proposition must be so strong that it can move the mass millions, pull (sic) over new customers to your product. (Source)”
Here’s how I simplified Reeves definition:
“A USP is a specific, beneficial promise to the customer which your competitors cannot or is almost impossible to replicate.”
The USP is one reason why GEICO has the highest market share growth from 2000-2018.
The USP is a part of what keeps Domino’s growth high and outpacing Pizza Hut and Papa John’s growth.
Peep Laja, the founder of the renowned conversion optimization agency Conversion XL, said:
“...if I could give you only one piece of conversion optimization advice, ‘test your value proposition’ would be it.” (Source)
I’ll take this one step further.
If you want to improve your value proposition, I’d advise to first improve your unique selling proposition.
Your value proposition is the value you promise to deliver to your customers.
Your USP enhances your value proposition by adding another layer of concrete value to make your promise unique to your business.
In other words, a USP is a value prop. But not all value props are USPs.
Reeves branded M&M’s as, “The milk chocolate melts in your mouth, not in your hand.” The specific value was hard for competitors to duplicate. Why? Because M&M’s used a patented hard sugar coating that keeps them from melting. (Source)
The potential danger of a strong value prop without a specific USP becomes noticeable when the competition advertises a similar value prop.
It’s said that the creator of M&M’s got his idea when he saw soldiers eating chocolates that prevented the candies from melting. (Source) And as you may know, it’s not hard for a competitor to steal your idea, than outspend you in marketing.
Adding a specific benefit allows you to add another layer of protection.
Still not clear what is the difference between a value prop and a USP?
It may help to consider the brand messaging hierarchy:
Perhaps a few examples will also help clarify how to create a USP.
In 1973, FedEx was the first to specialize in overnight air shipping, (source) beating out UPS by 12 years (source) and DHL by 10 years in the United States (source).
But outside the US, DHL had already been delivering overnight since 1969 (source). It would be a matter of time before DHL became the go-to solution for overnight shipping.
Five years later in 1978, FedEx came up with a powerful USP: “When it absolutely, positively has to be there overnight, choose FedEx.”
Even though DHL was first-to-market, FedEx was first-to-position.
Pop quiz.
When was the last time Domino’s gave their signature 30-minute guarantee?
1993. (If you’re living in Colombia, Vietnam, Mexico, China, or India, Domino’s is fulfilling their USP in those countries). (Source)
Yet Domino’s customers still remember this promise years later. Here’s a Reddit post from 2017 with pizza delivery guys and gals still hearing this complaint. And here’s another post from 2019 referencing the 30-minute delivery requirement.
That’s the branding power of a USP. It sticks in your customers’ minds several years later.
After 10 years of research, Procter and Gamble’s scientists found Pyrithione Zinc to be an effective ingredient in eliminating dandruff.
By the spring of 1961, P&G took Head & Shoulders to market with this unique ingredient and USP. (Source)
The competitive landscape is more competitive than ever. And there’s no sign of it slowing down.
How do you get your message to rise above the noise?
By creating a unique selling proposition. A proposition which your competitors aren’t making. Or flat out refuse to do so.
Here are three simple questions to ask yourself if you have a USP:
If the answer is “no” to one of those three questions, it’s time to put aside the advertising puffery and instead create a bold USP.
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