The Value of the Value Proposition – part 2
In the last post, I have discussed the use of a Value Proposition. This week, I like to dive in this a little deeper. Probably, many of you know the Business Model Canvas of Alexander Osterwalder. A less known model, but I prefer his model of the Value Proposition Design. Let me explain how to use this in practice.
The model consists of two parts, e.g. a Customer Profile (right circle) and a Value Map (left circle).
1. The Customer Profile consists of:
- Jobs: what is your client trying to accomplish (‘getting the job done’)?
- Pains: describes bad outcomes, risks and obstacles for your customer in getting a ‘job done’.
- Gains: the outcome of what your customer is trying to achieve in concrete benefits.
Important to know if this job is a functional job and/or a personal job (e.g. a personal ambition rather than the company’s strategy). In addition, each persona requires a different customer profile.
Most of the companies that we are meeting in (Deep) Tech seems to lack a sufficient knowledge about their Customer Profile. But this is an essential step for creating an effective Value Map and – in general – any effective commercial activity.
2. The Value Map
The Value Map is a description what you exactly offering and how it helps your customer with their ‘Job to be done’:
- Product and Services: An overview of your total offering, tangible and intangible.
- Pain Relievers: The Pain Relievers describe how your product or service is going to take away the (the most important) customer pains.
- Gain Creators: The Gain Creators describe how your product or service will ensure that the (most important) Customer Gains are achieved.
The Value Proposition Design is a good tool to check if your company is matching customer needs e.g. pains and gains. However, it does not necessary have to address all pains and gains in your gain creators and pain relievers.
Using the model at least on a yearly basis will help you to define and update an effective Value Proposition of your company. Fundamental for growing your business.