What is a Unique Selling Proposition (USP)?

Published by Thomas Herold in Economics

'Unique Selling Proposition (USP)' is explained in detail and with examples in the Economics edition of the Herold Financial Dictionary, which you can get from Amazon in Ebook or Paperback edition.

A Unique Selling Proposition, or USP, refers to the slogan or idea that sets apart the particular company’s products, goods, and services from their main business competition. It is typically expressed by a single, often short, sentence which succinctly sums up the point and purpose of the company’s primary line of business. Another way of putting this is that the USP acts as the overriding theme of a firm’s marketing plan and endeavors. Ultimately, this proposition strives to answer the customers’ query of why they should purchase a given company’s products instead of their competitors’ goods.

It is critical that the Unique Selling Proposition offers customers and possible customers alike a precise and well-defined benefit which appeals to them directly. This means that the USP can not simply describe better service or that which offers more value. Instead, the proposition should answer two questions directly. The first is what will set apart a service or product from those the competition offers? The second is what can the product offer that consumers determine to be worthwhile or worthy of spending their money on it?

Small businesses in particular find the Unique Selling Proposition critical for their ongoing operations. This is because they must compete against both larger retail corporations as well as other smaller businesses like themselves. It does not matter how superior a given product or service may be if consumers are not aware of its value and do not see a viable reason to purchase it over those which the competition offers them.

The history of the Unique Selling Proposition dates back to the middle years of the twentieth century. It was then that Rosser Reeves developed the concept. He was an American advertising executive who operated in the depression, Second World War, and post world war eras of the United States. Reeves held a personal conviction about the point of advertising. He felt that its only reason for being lay in conveying the specific slogan of a firm which got across their service or product message effectively.

He fiercely believed that such a slogan should never be changed. Among his best known USPs Reeves developed was one for candy maker Mars/M&M’s. This M&M’s candy slogan so memorably claimed, “The milk chocolate melts in your mouth, not in your hands.”

There have been countless effective other Unique Selling Propositions throughout modern marketing history. Some of the most effective are the ones consumers never forget. Hallmark Corporation’s USP is “When you care enough to send the very best.” Subway sandwiches are memorably referred to as “Subs with under six grams of fat.” The Men’s Warehouse has its, “You’re going to like the way you look – I guarantee it.” FedEx Corporation claims effectively, “When it absolutely, positively has to get there overnight.”

Some Unique Selling Propositions became so well remembered that they are even remembered years after a company chooses to abandon them for some reason. Wendy’s Hamburger chain, Taco Bell, and Dr. Pepper represent three classic examples of companies which had a USP that embodied this multi-generational slogan appeal. Wendy’s famously asked Americans, “Where’s the beef?” for years before finally moving on with other far less memorable selling propositions. Taco Bell’s little Chihuahua Dinky emphatically claimed, “Yo quiero taco bell!” and “Bless you, Taco Bell” for literally years. Dr. Pepper /7 Up Corporation famously reminded Americans for many decades that their flagship American iconic soft drink Dr. Pepper really is “Just what the Dr. ordered.”

According to the strict insistence of USP creator Rosser Reeves, all of these companies broke his cardinal rule of changing slogans which were wildly successful. Many of them paid the price in their subsequent decline in business brand appeal and resulting falling sales and profits.

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The term 'Unique Selling Proposition (USP)' is included in the Economics edition of the Herold Financial Dictionary, which you can get from Amazon in Ebook or Paperback edition.