Unique Selling Proposition (USP)

What Is a Unique Selling Proposition (USP)?

A unique selling proposition is essentially the key point that differentiates a company’s products from its competitors. In a nutshell, it’s the point that makes each company unique, and the proposition for why buyers should purchase from one company over another.

For example, if you were to open up the only gluten-free donut shop in your town, your USP would likely be that you’re the only 100% gluten-free donut shop in the area. This gives potential customers a very clear idea of what you can provide them compared to the competition (other donut shops and bakeries in the area).

Why Are Unique Selling Propositions So Important?

Unique selling propositions are important because they help your business stand out from the crowd. Without a USP, potential customers would have no idea why to buy from your business instead of the store next door – what’s the difference between Joe’s Donut Shop and Fred’s Donut Shop, for example?

However, with a USP, the difference becomes clear: Joe’s Donut Shop sellings gluten-free donuts, while Fred’s Donut Shop sells vegan donuts. Now, customers can make a decision about which shop to go to for their unique needs.

What Are the Characteristics of a Good Unique Selling Proposition?

For the most part, good USPs should provide three things to customers:

  • A clear benefit
  • Something unique
  • Relevancy

What does this mean in practice? A good USP should always make it clear what benefit the business provides – for example, that people who eat gluten-free can find donut that meet their needs at your business.

The USP should also be unique: not only is your business great for people who eat gluten-free, but it’s the only good option for them in the area.

Finally, it should be relevant: if you’re trying to attract people who eat gluten free, you shouldn’t make your USP be all about whole wheat donuts. That wouldn’t be relevant to the prospects you’re trying to attract.

One good example of a famous unique selling proposition comes from FedEx: this company’s USP is that it will always get your packages to their destinations quickly and on time.

Another great example is from Avis: it’s the number two car rental company, so it tries harder than its competitor, Hertz, to ensure a great customer experience.


See our full list of over 50 Small Business Terms here


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