What is a unique selling point? A guide to USPs for small businesses

If you’re looking to grow your business or start a new one, a unique selling point (USP) can help you stand out from the competition and build a company identity.

Read on to find out about the different types of USP, how to identify one for your business, and how a unique selling point can help you to market your brand.

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What is a USP?

The USP meaning is something that makes a business different from its competitors – it could be to do with your product or service, but could also relate to your company culture or values.

A USP can help your business thrive, particularly if you’re solving a long-term problem for your target audience.

Once your business has a unique selling point, it’s crucial that you amplify it to your customers and do everything you can to become known for it.

What is a USP in business?

A USP is the one thing that makes your business different from the rest. It can also help your business to grow if it’s something your target customers care about.

For new businesses especially, it can be hard to succeed without a USP. Even if you’re entering a crowded marketplace, you can still stand out with a unique selling point.

However, it’s important to remember that just being cheaper than the competition shouldn’t be your USP. Even if your service or product is very similar to your competitors, you can stand out with a USP such as a sustainable focus or innovative brand values.

What are the benefits of having a unique selling point?

A strong USP can help you to attract customers and build loyalty. It also gives your business a purpose and identity, which can motivate staff and make sure everyone is pulling in the same direction.

Growing businesses with a USP can find it easier to get funding such as angel investment, venture capital, or crowdfunding.

If you go down this route, the details of your USP are perfect for including in an executive summary or business proposal.

Another benefit of having a USP is that it can give a focus for your marketing activity – even if you don’t have a catchy slogan, referencing your USP in advertising can be highly effective.

What are the different types of USP?

Your company’s USP can be anything, but here’s an overview of some of the most common types of differentiators:

• unique product or feature – something that hasn’t been done before and addresses a pain point for your target customer
• personal brand – an inspirational, unconventional, or well-known leader can be an effective USP for a business
• unique service – you may sell the same product as your competitors, but if you deliver it in a different way it can help you stand out
• geographical advantage – if you’re the first company to bring a service or product to an area (such as sustainable grocery deliveries), you’ll have a head start at becoming the market leader

How to identify your USP

If you’re a new business, it’s useful to identify your USP as soon as possible. Here are some of the questions you’ll need to ask yourself:

• who is your target audience/customer?
• why would they buy from you instead of your competitors?
• what do you offer that’s different from your competitors?
• what value and benefits do you offer customers?
• do you offer a solution to a problem faced by your customers? (Make sure you’re not trying to solve a problem that doesn’t exist)

Build your unique selling point in six steps

This process is similar to finding a gap in the market. By carrying out the following steps, you can start to build your USP and stand out from your competitors.

1. Make a list of your strong points

Established businesses can think about all the things they do well and all the things they’re known for by their customers.

If you’re yet to launch, make a list of all the things you want to be known for and think about how they could form a USP.

2. Research your competitors

Finding out more about what your competitors are good at and what makes them stand out can help you to identify a gap in the market or a USP for your business.

Read our guide on how to do a competitor analysis for your small business to get started.

3. Compare and compile all your data

Once you’ve gathered all the information about your own business and your competitors, it’s time to compare and contrast.

Getting together with your team, analysing the information and brainstorming ideas can be an effective way to home in on your USP.

4. Market research and focus groups

Speaking to your target customers is really important as it helps you to find out what they want and what they expect from you.

You can run focus groups and get prospective customers to test your service. Analysing internet search trends and monitoring social media are also beneficial.

Read our in-depth guide to market research for small businesses for more ideas.

5. Positioning your business

Once you’ve decided on a USP, you’ll need to think about how you’re going to promote it to potential customers.

Effective marketing is a crucial part of building your identity and becoming known for your USP. Read our guide to marketing for small businesses for top tips on SEO, content marketing, and reviews.

6. Record everything and keep reviewing

Make sure you document everything from market research and competitor analysis to brainstorming sessions and written USP statements.

It’s important to remember that you’ll need to keep reviewing and refining your USP as the needs of your customers change.

USP examples in business

Some of the world’s most successful businesses have got to where they are by building their identity on a strong USP.

Here are some well-known examples:

• Uber – the app has become synonymous with ride sharing and cheap taxi fares. There are lots of alternatives now, but Uber was the first and remains the best-known
• Ben & Jerry’s – a global ice cream brand that has built its identity on sustainability and fair trade
• IKEA – large warehouse stores and flatpack furniture at affordable prices have helped to make IKEA one of the go-to brands for home furnishings
• Tesla – not the first electric car brand, but one that’s helped bring low-emission vehicles to the masses through its well-known leader Elon Musk

There are also many brand names that have become synonymous with the product or service they offer, such as Biro, Hoover, Sellotape, and Jacuzzi.

How can you promote your USP in marketing?

Having a strong USP is pointless if none of your target customers know about it, which is why marketing is so important.

Here are four quick tips to help promote your USP effectively:

• condense the information – come up with a tagline or phrasing that succinctly communicates your USP in an appealing and digestible way
• answer customer questions – think about what your customers want and explain how your USP solves their problems
• focus on what makes you stand out – rather than mentioning features that competitors also offer, such as good customer service or free delivery
• use figures to back up your USP – sales figures, satisfaction ratings, customer numbers, or reviews that back up your unique selling point can be a powerful addition to your marketing

Do you have any tips for identifying a unique selling point? Let us know in the comments below.

Photograph 1: BullRun/stock.adobe.com

Photograph 2: Seventyfour/stock.adobe.com