The Value Proposition

Tony Karlicek is CEO of Frederick, Md.-based Headwear USA; the U.S. office is of one of 10 global offices of The Headwear Professionals. His experience spans from working in the warehouse when he started with Headwear to working closely with distributors to develop corporate programs as sales manager.

Honestly ask yourself: Do you sell a product or do you bring exceptional value to your customers? If up until two seconds ago the answer was “sell products,” perhaps we can increase sales by discussing selling value over product. Talking with customers in terms of maximizing their budget for brand recognition and return on investment is far more effective than trying to consistently win business with low-ball pricing and special deals. 

We all know, no matter how good the deal is there is always someone willing to do it for less. But if we are viewed as problem solvers rather than salespeople, it’s much more likely to get a higher level of inquiry because we’re not simply selling a widget and taking money, but helping to grow business and increase clients’ bottom line. The difference is in the delivery of how the value of services is discussed and how products are priced and presented—the difference is this value proposition.

Capstone promotions

The value proposition works for many products, but caps add a little extra to the proposal. Caps are coveted and even collected nationwide. The power of the baseball cap is the impression it makes; giving a powerful testimonial without saying a single word. We link persona to the caps people sport—think about the statement a person makes by donning racing, sports team or collegiate caps. The very same holds true for promotional caps. Making personal endorsements through logoed headwear is simply part of American culture.

But beyond making personal statements, consider what statement the caps themselves can make in uniform and gift programs for example. Will the experience of eating in a restaurant be improved if the staff has sharp looking branded shirt and cap? The personalized promotional program implies an environment that is professional and cohesive. Or think of the overall impression a potential customer would have after test driving a car if they received a branded cap as a thank you. The dealership’s customers will walk away with something of value for the time they spent, and grateful for the gift in return for spending their time. 

And finally, consider the implications of that gift when the thankful dealership customer shows up to the next weekend BBQ wearing that cap. Most people are inquisitive and caps are a great conversation piece. This extends the gift program into the realm of brand recognition and plays into the cap’s value in terms of cost per impression.

Explore the options

Step in the customer’s shoes and evaluate the following offers:

Option 1: 72 baseball caps with an embroidered logo for $5 each.

Option 2: A brand recognition program delivering more than 400,000 impressions over the next full year for $360.

I may be biased, but I would go with Option 2… yet they are the exact same offer. Honestly, the fair response to Option 1 is that it sounds like a good deal, but doesn’t tell the customer why they should be making this purchase or how it will help grow their business. In terms of getting the order, it also leaves too much to chance and leaves money on the table in terms of using their full budget. Most importantly, Option 1 allows competitors to make the tempting offer to “do them for $4.90.” Who wants to play this commodity game, welcoming low margins and low value? 

Instead, tell customers what you can really do for them. Promotional apparel really does work. If customers are not shown the value of promotional wearables, they will not take the time to find it themselves, we fall short of servicing them properly and ultimately, they’ll spend their marketing budget everywhere but with you. 

Option 2 informs customers how their hard earned cash will go to work for them. It communicates how their investment will work in terms of brand recognition and exposure. By framing the value proposition as such, it’s no longer about selling an item but about providing a branding solution. Informing customers what these ‘things’ will actually do will instantly position your business above the competition that is just selling those ‘things.’ At the end of the day, customers want value and will get it by investing in a promotion that costs, in our example, just $0.0008 per impression. To top it off, it’s difficult for competitors to say they can provide the same exposure for less. 

Head-first value

We create this overall value proposition by taking a look at some accepted industry numbers and applying a little common sense about the retail consumer world in which we live. For discussion sake, let’s use a retail selling price of $5 for a 72 piece cap order. Most baseball caps sold in malls, airports or specialty sports shops sell for at least $15. As such, inform customers that, even though you are only charging $5 per cap, their customers will see that $15 to $25 retail price tag on this gift. This is one of the primary reason baseball caps have been and always will be a mainstay of the industry. 

By reminding customers of this value, you take the emphasis off what they are spending and instead focus on what are receiving. This is very important in separating what you are selling from how you are helping them. If you only cost them money, they will not come back to you. But if you make them money, you are welcome to call on them at any time. Getting the order is nice. Getting the order from a customer who is happy to give it you is 10 times better. Apply this same model to all of the products and services our industry allows us to offer.

While the value proposition may not be necessary to use at every discussion or meeting, it is important to remember that what we do in the business of decorated apparel and promotional sales has intrinsic value. Our industry has the power to sway the buying decisions of millions of people. Think of your services and business in terms of brand recognition and value creation. When we limit our mindset to the business of simply selling and decorating ‘things,’ we are seen simply as decorators. But we have the opportunity to be a valued partner to customers’ businesses.