One of the most common conversations I have with partners is about the basics of marketing, which includes the creation of a Value Proposition. Every company should have one, but it takes a bit of work to get it right.
A Value Proposition, very simply, is the benefit that a customer can expect from your products and services. It is the unique story of how you can solve your customer’s pain points.
To help tackle the creation of a strong value proposition, I consulted Value Proposition Design by Alex Osterwalder, Yves Pigneur, Greg Bernarda, and Alan Smith. This easy-to-understand, illustrated desk manual breaks it down step by step to help you build a message that resonates with your customers. Let’s jump into the specifics.
Step 1: Observe the Customer
First, observe your customer and their pain points. As told in Value Proposition Design, you can break down your understanding of the customer in a structured way like this:
- Customer Jobs – What are customers trying to get done in their work and in their lives, expressed in their own words?
- Customer Pains – What specific bad outcomes, risks, and obstacles are customers facing when trying to accomplish their jobs?
- Customer Gains – What outcomes does that customer want to receive and what benefits are they seeking?
Step 2: Design a Value Prop that Fits
To help create the value proposition, analyze your products and services. Break it down into three categories:
- Products and Services – Make a list of all the products and services that a value proposition should be built around.
- Pain Relievers – How do your products and services alleviate customer pain?
- Gain Creators – How do your products and services create customer gains?
Craft your value proposition by asking your customer what they love about you and what you do that allows them to sleep better at night. For example, your customer might love that you are local and able to solve problems quickly. This same customer is worried about their data and information being in the cloud. An example of a value proposition tailored to this customer’s need might be “Acme Tech Partners is in your neighborhood, so our staff can solve any issues quickly. We have a deep experience with Azure and are able to keep your data safe, secure, and available without negatively impacting your business.”
When your value proposition meets your customer profile, you have a fit.
Step 3: Lean In and Add Value
It’s important to be precise in designing your value prop so that you can specifically understand the use case for that customer. In Value Proposition Design, the authors speak about types of customer jobs that you’ll want to dig into to help you be specific:
- Functional Jobs – Customers are trying to perform or complete a specific task or solve a specific problem (i.e. mow the lawn).
- Social Jobs – Customers’ jobs surround the idea that the customer wants to look good or gain power or status (i.e. looking trendy). These jobs center on how the customer wants to be perceived by others.
- Personal or Emotional Jobs – When your customers are seeking a specific emotional state, such as feeling good or secure (i.e. peace of mind regarding investments).
- Supporting Jobs – These jobs relate to buying value, to co-creating, value or to the end of a value proposition’s life cycle.
Ask what annoys your customer before, during and after trying to get a job done or that actually prevents them from getting a job done. Are there obstacles in their way? Are there risks? How severe is that pain?
Here are some great questions you can use to get to the root of the pain:
- What makes your customer feel bad?
- What are the main difficulties and challenges your customers encounter?
- What risks do your customers fear?
- What’s keeping your customer awake at night?
- What common mistakes do your customers make?
- What barriers are keeping your customers from adopting?
According to the authors, the same is true on the Customer Gain side. Identify what is required, expected and desired by your customer. Ask what would be unexpected and then go above and beyond. Helpful questions include:
- Which cost savings would make your customers happy?
- What quality levels do they expect?
- How do you delight customers today?
- What would make your customers jobs or lives easier?
- What do customers dream about?
- How do your customers measure success and failure?
As you can see, the value proposition is based on really listening to your customer, bringing their needs to the forefront, and solving those needs. The best value propositions even go above and beyond to make a customer happy. Check out this video from Smart Partner Marketing that illustrates some magic questions to answer that help you form a strong unique value proposition.