At a time when customer expectations and needs are constantly growing, creating a compelling value proposition is a key success factor. But how to stand out from the competition and win customers over?
It is important to have a clear picture of who your customers are, what they expect from your products or services, and how you can bring real value to them. Think about it what values do you bring to your customers and what specific problems do your customers solve?
Are you bringing the desired value to customers?
Getting to know your customers better will help you with the so-called Value Proposition Canvas. It is a strategic tool created by Dr. Akexander Osterwalder, who offers a simple path to answers to fundamental questions: WHO are your customers? WHY should they be interested in your service or product?
You can develop a Value Proposition Canvas for any selected customer segment. It is a connection of two basic pillars:
- value proposition (on the left in the picture) – defines the value of the product or service for the customer.
- customer segment (on the right in the picture) – is linked to a unique customer profile,
Define the value proposition for your customer
To make your work as easy as possible, we translated the Value Proposition Canvas template from Strategyzer.com into Slovak. Download it at https://bit.ly/3XBj3TT and you’re good to go. We’ll show you how. When working out, base it on your business model. We discussed its creation in detail in the article: How to create a business model, and why it is so important in business.
- Know your customer segment
Choose one of the customer segments and start by filling in the right part of the Value Proposition Canvas (the Customer Segment part). It is about thinking about the profile of your customer from the selected customer segment, in which you define their basic needs, concerns and wishes. This section will answer the question of WHO your customer is. Think about these areas:
Basic needs of the customer (jobs to be done) – this is an area recording the needs of the customer that he is trying to solve and the tasks that he wants to fulfill in connection with your product or service. Classify his needs as follows:
emotional – needs focused on the customer’s own perception, and therefore self-perception, e.g. I want to feel more confident, I want to be happy with myself.
functional – tasks or needs that your customer wants to complete, e.g. I want to have healthy skin, I want to buy a new suit for work,
social – needs in which the customer wants to be perceived by the environment in a good light, e.g. I want to look good, I want to look competent and professional,
the customer’s concerns (pains) – list everything that bothers your customer in connection with the fulfillment of the above-mentioned needs. It is about his fears, frustrations, risks and negative emotions. Put the ideas into the following subcategories:
- unwanted concerns – e.g. I’m afraid I won’t find a well-paying job, I’m afraid I’ll choose the wrong cut of a suit,
- obstacles and negative emotions – e.g. I’m afraid that I won’t have a good work team, I’m afraid that I won’t feel comfortable in a suit,
- risks and concerns – e.g. I’m afraid that my salary at my new job won’t cover my expenses.
Customer wishes and gains – think about the positive benefits, wishes and expectations that make it easier for the customer to fulfill his needs. Customer wishes have different levels of priority:
- required – wishes and positive benefits of products or services without which the fulfillment of customer needs will not work, e.g. professional approach, product transparency,
- expected – wishes and positive benefits that the customer expects from products or services, but can fulfill their needs without them, e.g. the possibility of a personal meeting, problem-free resolution of complaints,
- desired – wishes and positive benefits that the customer would like to have if he could, but does not expect them, e.g. expert advice, acceptable product price,
- unexpected – wishes and benefits that are beyond what the customer expects, e.g. clear online platform, possibility to change the delivery address of the product online.
2. Define your value proposition
After defining your customer profile, proceed to fill out the left part of the Value Proposition Canvas (the Value Proposition section). It concerns your product or service, or activities that help solve your customers’ problems. This part will answer the question WHY the customer should be interested in your service or product. Consider these areas:
features of products or services that alleviate the customer’s concerns (pain relievers) – list all aspects of the product that help solve or alleviate the customer’s concerns.
products & services – list all products or services that you offer to customers from the selected customer segment.
features of products and services that create benefits for the customer and fulfill their wishes (gain creators) – list all aspects of your product or service that fulfill your customer’s wishes and how they create benefits for him, e.g. clear and transparent online platform, experienced team of experts.
3. Define the fit between need and value
After filling in both sides, select the most relevant and important ones from the defined areas. The goal is to achieve a match between the value, that your product creates and the customer’s need. To define a match, proceed as follows:
- Make sure that the needs, concerns and wishes of the customer defined in the customer segment match the profile of the real customer.
- Formulate the customer’s problem or unfulfilled need.
- Describe how the customer solves the problem without your product.
- Define whether the solution to his problem is better with your product or service than what the competition offers.
- Identify areas where the customer’s needs match the value your product or service brings to them, as well as gaps where improvement is needed.
- Look for opportunities to differentiate your offering from the competition and provide greater value.
Why is the Value Proposition Canvas important?
The Value Proposition Canvas is an effective tool for a deeper understanding of customers, their needs and problems. It will bring your product-oriented thinking closer to the customer. It will show you opportunities to adapt the offer to the customer’s needs so that it is convincing, differentiates you from the competition and brings you a better position in the market. Then transform the outputs into the pillars of your marketing communication.
