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The value proposition is the single most important element in a brand’s positioning strategy and often defines its success (or failure) in the market.
This is a statement which articulates the value that the brand promises to deliver to its customer. It answers the question “why would a customer buy this?”. It must be distinctive and persuasive in order to convince a potential customer to buy the brand, rather than sounding similar to other competitors in the market.
The most basic of value propositions will only focus on articulating the features and benefits of a product, enabling customers to understand it’s functional benefits. This is a surefire way to position the brand as a commodity.
To really win in the market, brands need to go deeper with their value propositions to talk about the problem that they solve and how they create positive gains and improvements in their customer’s lives.
Why is a value proposition so important?
If produced well, this can help improve brand awareness and preference. It is critical that the promise of the value proposition can be delivered to customers on a consistent basis – this will lead to loyal long term customers.
Great value propositions are built based on customer insight – knowing what the customer wants and articulating the value proposition in a way that strongly resonates with them.
What is the value proposition canvas?
The value proposition canvas is an excellent tool that can be used to align a product or service more closely to its target customer’s needs. It was initially developed by Dr. Alexander Osterwalder as a framework that helps businesses build robust customer value propositions.
It can be used when there is a need to polish an existing offering or when a new offering is being developed.
Customer profile map
A customer profile must be created for the target customer which reflect their individual jobs, pains and gains.
- Customer jobs – The social, functional and emotional jobs that customers are trying to get done this includes wishes that they need to satisfy and the problems that they are trying to solve.
- Gains – The benefits that target customers would like and the things that will delight them if they get their job done well.
- Pains – The negative experiences, risks and emotions that the customers experience by not getting their job done.
Value proposition map
- Gain creators – how the product creates positive gains and how it will benefit the customer.
- Pain relievers – How the product will remove the pains from the customer’s life.
- Products and services – the products and services which the business is offering to the customer which will provide pain relief and gains for those customers.
Achieving fit between a customer and value proposition
A fit is achieved when the product solves the most significant pains and delivers significant gains to the target customer. It is important to validate the hypothetical customer value proposition with real-life customer data (or with data from prospective customers if the brand is just launching).
Jobs-to-be-done theory was by Clayton Christensen in 1999 through his best selling book, The Innovator’s Solution. It is closely related to the value proposition canvas but takes a more fundamental look at the customer’s motivations behind why they purchase a product. is It is based on the idea that people will purchase a product or service to get a “job” done. With jobs to be done theory, brands are more likely to create solutions that will win in their industries.
When brands put jobs-to-be-done theory into practice, they give themselves a competitive advantage in the marketplace:
- Consumers will buy products and services to get the job done.
- Brands can move beyond functional benefits and can talk about the emotional (gains) that their product or service offers to customers.
- Customers default to using the brand to “get the job done” – building brand loyalty.
- Product development teams can focus on a more meaningful measure of analysis that matter to customers – how well did we get the job done?
- A better understanding of the customer’s job-to-be-done makes marketing more innovative and effective.
It is a good practice to consider the customer’s “jobs-to-be-done” so that the right solutions can be offered.
Jobs-to-be-done can help develop a product innovation strategy
Product innovation should act like a compass which points the brand in the direction that delivers the most value for the customer. The jobs-to-be-done framework (and value proposition canvas) can be used to guide product innovation by keeping the brand focused on the most important thing – the core functional job that the customer needs to be done.
Best examples of value proposition
Stripe’s “Web and mobile payments, built for developers”
Stripe is an online payment tool which allows businesses to accept and manage online payments. Their target market are business owners and developers. The primary benefit that Stripe offers is “simple and streamlined payments”, emphasising on the brand’s simple to use products.
Uber’s “Get there: Your day belongs to you”
Uber is the leading ride-hailing app in the world and it hits its target consumer right where the problem is, eliminating problems when traveling. Uber’s proposition focuses on customer’s needs by including the word “you”.
Target’s “Expect More, Pay Less”
Target aims for cost-conscious shoppers who are looking for quality items. Their value proposition shows how shoppers can get quality products at affordable prices. It hits the right balance between quality and affordability.
Skillshare’s “Learn a New Skill Each Day”
Skillshare’s target market are customers with creative minds and entrepreneurs who are looking for affordable and easy to learn online lessons. They hit the market by providing a quick and focused on-demand learning experience via bite-sized lessons.
Evernote’s “Remember Everything”
Evernote targets students, busy individuals and professionals. Their app allows easy organisation for notes, photos, audio clips and other data – enabling its users to organise all their ideas in one place. Evernote enable users to organise everything so that they never forget ideas or important information.
Spotify’s “Music for Everyone”
Spotify made sure to include all music lovers out there with their fun proposition. It does not single out any particular segment because it provides music that suits everyone’s tastes.
Bitly’s “Shorten. Share. Measure”
Bitly’s value proposition features exactly what it has to offer no more, no less. It focuses on three important elements in link management and it works because it removes any unnecessary language.
Creating a good value proposition can enable a brand to sharpen how it articulates it’s offering to customers. Developing it requires an understanding of exactly what customers need and is the articulation of how the brand will deliver on this need.