How to create your unique & converting value proposition? Your all-in-one guide.
Your first step to scalable growth? When growing a business, you will build it up from the very fundamentals. The value proposition is a clear and concise statement that summarizes measurable benefits your customers will receive when purchasing the products or services. Your value proposition motivates the prospective customers to buy from you and differentiates your offering from similar products in the market. It explains how the product solves customers’ problems. Having a value proposition, which is clearly understood and widely accepted by the target audience, gives your company a huge competitive advantage, and is therefore the most important element for growth.
What are the benefits of the Value Proposition CANVAS?
Precisely define your customer profiles: Identify your customer’s major Jobs-to-be-done, the pains they face when trying to accomplish their Jobs-to-be-done and the gains they perceive by getting their jobs done.
Visualize the value you create: Define the most important components of your offering, how you relieve pain and create gains for your customers.
Achieve Product-Market fit: Adjust your Value Proposition based on the insights you gained from customer evidence and achieve Product-Market fit.
What is a Value Proposition CANVAS?
The value proposition canvas is a framework that allows entrepreneurs to establish a product-market fit. It is a tool intended to analyse the relationship between different customer segments and the solutions your business can provide them. The main goal of the value proposition canvas is to shape the product or service to the customers’ requirements.
Swiss business theorist Alexander Osterwalder developed the value proposition canvas in 2014 as a supplement to his Business Model Canvas During his work on the original framework, Osterwalder understood that people often have difficulties finding the right fit between UVP and customer segments. Value proposition canvas is effective when there is a need to improve the existing product offering or when you want to develop a new offering from scratch. The tool is perfect when you’re working on creating a start-up, restructuring the sales process, adding a new feature to the product, and expanding into a new customer segment or new market.
What is the structure of the Value Proposition CANVAS?
Value proposition canvas includes two main elements: the circle responsible for the customer’s profile and the square with a value proposition map. The value proposition canvas template allows for visualizing customers’ needs and defining a response to these needs on one page. It is very convenient to check the match between pains and gains, gain creators, and pain relievers.
- Customer profile
Jobs. This section includes the problems, tasks, and needs your customers are going to meet. There are several types of customer jobs: functional, social, emotional, and supporting.
Functional jobs are specific tasks your customers want to achieve with your product or service. If you are selling drills, a functional job would be making a hole in the wall to place a new piece of furniture.
Social jobs are related to the impressions people want to make on others with the help of your product or service. In the case of new clothes, a social job would be to look trendy or get compliments from friends.
Emotional jobs are related to the feelings the customers want to achieve due to the product. For example, a woman buys some makeup products to feel more confident.
Supporting jobs are ancillary tasks when the core job is done. There are three main roles: buyer, co-creator, and transferrer. In the buyer’s role, your customer compares offer, stands in the checkout line, or takes delivery of product or service. The co-creator’s role requires posting feedback or reviews or participating in the design of the product. Transferrer’s role implies reselling the product or cancelling the subscription.
Pains. These are the difficulties, negative emotions, risks, and undesired situations the customers face before, during, and after getting the job done. The customer pains can include things that the customers find too expensive or time-consuming, make them feel bad, or the obstacles preventing the customers from coming to a decision.
Gains. This segment should contain the benefits, desires, and positive experiences the customers have. Gains often include cost savings or functional utility. It is essential to mention that pains and gains are not polar notions, so they are not necessarily interrelated.
- Value proposition map
Products and services. Here you need to mention the products and services which relieve a pain and create a gain for the customer. You can also add various versions of products like standard and premium.
Pain relievers. This section describes how the product or service solves undesired situations, alleviates risks, or reduces negative emotions when your customer gets the job done.
Gain creators. This part of the value proposition map explains the extra value of the product or service, the expected benefits, and how the product would make your customer happier. You can also mention what your product does better than the other offerings in terms of quality, functionality, usability, and other features.
Therefore, value proposition canvas allows you to put yourself in a customer’s shoes and better understand their wishes.
How to use the Value Proposition CANVAS for your business?
Step 1: Before you start
Arrange for a comfortable environment. Definitely not a meeting room.
TIP! Cut the canvas in two halves (the right part with the circle and the left part with the square). Start by showing only the right (circle) part to your team. This prevents them from immediately focusing on what they think features, pain relievers and gain creators should be. Checklist:
- Arrange a relaxed, positive, and private environment
- Have markers (fine tip) and paper for everybody
- Print or draw the canvas on a big sheet of paper
- Have plenty of sticky notes and markers
- Allow yourself 45 minutes of undisturbed time
Step 2: Always start with the customer
To get started with the Value Proposition Canvas, always start with the customer. Of course, you may have many different customer segments that you serve (or want to serve). So, as a team your first task is to discuss who the customers actually are from a high level, whereupon you can make some decisions about who you are designing for. You may need to fill out several canvas- es, one for each customer.
Step 3: Always enough “why’s”
Once you’ve made the customer decision, as a team – using sticky notes and permanent markers – start to detail your customer’s jobs- to-be-done. What social, emotional, and functional jobs does your customer do daily? They have some functional job that you know probably about. But you’ll also need to uncover how they do that job, how they feel, and what social qualities come into play. For instance, a parent with the job of driving a child to school may also have functional jobs of getting them there on time, ensuring they’re fed throughout the day, making sure they’re not looking like an outcast (social standing may be important), providing the feeling of being loved and appreciated, etc. Ask enough “whys” and you’ll get this info. Pains are usually easiest to get. What gets in the way of a person’s jobs? It’s gains that elude most first-time users of the
Value Proposition Canvas. Gains are NOT simply the opposite of pains. Instead, gains are the hidden ambitions people have, above and beyond pain relievers. It takes a designer’s mind to uncover these. This is where asking the right questions is important. What does your customer really aspire to do that they cannot do now? Going back to the parent-driver example, perhaps it’s to look like a hero to their kids and other parents or to see their kids succeed in life. If gains sound somewhat existential to you, that’s probably because great gains often are.
Step 4: Your job
Finally, once you’ve completed the right side of the canvas, move over to the left side. First, list some solution options that come to mind. You might have some already, or you might create some during an ideation session (detailed in the next chapter). With these in place, you’ll need to decide how these can be used together to address your customers’ jobs, pains, and gains in unique ways that resonate with your customers. Using this canvas a few times will help you think differently about your customers and what you offer to them. What’s more, done well, your customers will think totally different about why they hired you to fulfil their needs in the first place.
TIP! Check the job-to-be-done with actual customers. You’d be surprised about the answers they will give. Look up the ‘milkshake’ video by clayton Christensen to be inspired!
EXAMPLE Check out this video by Clayton Christensen, where he explains the job-to-be-done.
Step 5: Check your work
When you filled out your canvas, take a step back. Your canvas is sufficiently detailed when:
- You mapped one customer persona per canvas
- You identified and prioritized at least 5 functional, social, and emotional jobs-to-be-done
- You identified and prioritized at least 5 pains
- You identified and prioritized at least 5 gains
- Every pain or gain is directly addressed by a corresponding pain reliever or gain creator
- The products and services cover the gain creators and pain relievers
Step 6: Next steps
- Find your riskiest assumptions
- Create an experiment to test your assumption
- Prototype the value proposition and validate your assumptions
- Check your assumptions with customers. Is it the real job-to-be-done?
When growing a business, you will build it up from the very fundamentals. You therefore must start with your Value Proposition to the market. The value proposition is a clear and concise statement that summarizes measurable benefits your customers will receive when purchasing the products or services. Your value proposition motivates the prospective customers to buy from you and differentiates your offering from similar products in the market. You can download the template below and get started with designing your own. Use the steps above and get ready to scale.