Sure, you know your company’s products and services have value, but how do potential customers know that?
A value proposition is the “why” in “why should a potential customer buy from you?” It communicates the benefits customers can expect from using your products.
A Value Proposition is not an elevator pitch (which simply defines what you do and who you help). It is not just unique selling point (which focuses on specialty claims or guarantees specifically to set you apart from the competition).
The core focus of the value proposition is to connect the benefits of your product or service with the problems customers face.
Discovering Value
There are a few levels of fit we can help you uncover by connecting your offerings with customer needs.
- The problem-solution fit comes first to identify how you address jobs, pains and gains customers care about.
- The product-market fit shows how you are providing pain relief and improving your customers’ current situation beyond meeting their basic needs.
- The business model fit is a conversation we have with you to make sure the value proposition fits within your organization so that there is value internally to make a profitable, scalable business.
A well-crafted value proposition can be used in sales scripts, marketing collateral and any customer-facing messaging.
By the end of the workshop you will have clear ideas on how the newly defined alignment of customer value and company value can be used to effectively drive your business goals.
The Customer's Perspective
We facilitate the customer perspective session by starting with an exploration of who the ideal prospects are. It is important to keep in mind that these profiles are based on the quintessential candidate and not necessarily modeled after your current client base.
The customer profiles are created with demographic factors (for example: age, season of life, profession) and psychographic factors (for example: risk-taker, early adopter, traditionalist) kept in mind.
We then go through three series of prompting questions to discover the three main components of the customer’s needs for the value proposition canvas — a tool used to visually lay out all the elements used in crafting a value proposition. After the questions are read, we allow you time to come up with responses and then deliberate as a group to select the top 2 to 4 factors to record on the canvas.
The three segments cover:
- Customer jobs: which may be functional, social, emotional or inherently human in nature;
- Customer pains: which encapsulate negative feelings, high costs, risk factors, challenges and difficulties faced); and
- Customer gains: referring to savings, dreams, success measures and outcomes achieved once customers complete their jobs.
Once all segments have been covered but while still in the customer mindset, we will discuss what metrics customers use to evaluate their success and collaborate on finding power verbs which motivate them. These will be used in the final stages when word-smithing the value proposition.
Step 2: The Business Offerings
Without you, there could be no value added. Our second session focuses on what you offer and what that means for the customers. Similar to the customer session, we go through three rounds of exploring question prompts, but this time it comes from the perfective your company and brand.
The three segments uncover and record:
- Your products and services: a.k.a. what a customer actually gets when a sale is completed;
- Pain relievers: which include functional solution fixes, risk eliminations and “I can finally sleep at night” feelings a customer experiences thanks to your offerings; and
- Gain creators: defined by the savings, above-and-beyond outcomes, positive consequences and delights customers can look forward once receiving your products and services.
Even though the canvas may look complete once these segments are filled in, we still have one more conversation to have while still wearing our business hats: the competition.
Before we adjourn, we’ll take some time as a group to make a list of companies, products and processes that function as alternatives to what you do, and highlight which features make them stand out as your competition.
Step 3: The Value Intersection
In the last phase of the workshop we use an ad-lib template to compose value proposition statements. The ad-lib is designed to communicate the fit between the “what” (your company) and the “why” (your customers’ needs).
This is also when we will evaluate the problem-solution and product-market fit mentioned earlier through aligning specific segments of the canvas.
In multiple rounds of experimenting, shaping and word-smithing, we identify one or two final value proposition statements.
the ad-lib template:
Our [products and services] help [customer segment] who want to [customer job] by [customer-compelling verb] [pain reliever] and [customer-compelling verb] [gain creator]; unlike [competing alternatives] *optional
While these can be tested in the market as part of a content strategy, we don’t want to leave it all up to guess and check. Our role in facilitating this session is to help measure the strength of statements as well as keep business model fit in mind by digging into key attributes of a well-formed value proposition including:
- Appeal and desirability: How much do I desire this? Does it go beyond surface level issues?
- Exclusivity: Where else can I get this? Does it outperform competition or can it be replicated?
- Credibility: Can I trust your claims? Is there evidential proof?
- Clarity: What are you actually offering? Does it align with how I, as a target customer, measure success?