Beyond the Product: Elevate Success with Value Proposition Design
Published on 28 Feb 2025 in
Even more concerning, product analytics suggests that an overwhelming 80% of fresh product features are left untouched by users. The monetary loss here is not trivial; we're talking about a whopping 29.5 billion dollars going down the drain.
So, what’s the deal-breaker? In many cases, it’s the disconnect between the business and the consumer. The fundamental questions, such as what the product or service is intended for and how it creates value for customers, are often overlooked.
Allow me to introduce you to the Value Proposition Design - a strategic tool that helps you hit the bullseye.
What is Value Proposition Design?
Value Proposition Design is the brainchild of Alex Osterwalder, a savvy entrepreneur and business model consultant, Yves Pigneur, the brains behind Management Information Systems at the University of Lausanne, and Greg Bernada, a connoisseur of strategic organization development, creativity, and innovation.
At its core, Value Proposition Design is about empathy. It’s about knowing your customer's pulses - understanding their problems or needs, and then designing products or services that pack a punch in terms of value.
Before diving into the nitty-gritty, let’s lay the groundwork with three mindsets you must embrace:
Customer-Centricity: You're creating for the customer, not for your reflection in the mirror. Ditch personal biases and be all ears to customer woes and wishes.
Focus: Don’t try to be the Jack of all trades. Pick a customer segment you are passionate about and drive transformative changes in their lives.
Agility: Flexibility is key. Markets and customer preferences are like shifting sands. Be adaptable and willing to iteratively test and enhance your value proposition.
Dissecting the Value Proposition Canvas
The Value Proposition Canvas is the beating heart of the Value Proposition Design. It has two main compartments:
Customer Profile (depicted by a circle) - This is your customer’s DNA, outlining their needs.
Value Map (represented by a square) - This is where you break down the value your product/service brings to the table.
Digging deeper, we have six critical elements:
Customer Job: What task or objective is the customer gunning for? It could be functional, social, or personal/emotional.
Gain: The sweet spot - the benefits the customer is chasing.
Pain: The thorns - the barriers or negative experiences the customer wishes to avoid.
Product & Service: The arsenal at your disposal to deliver value.
Gain Creator: The aspects of your product/service that catapult the customer to their desired gains.
Pain Reliever: The elements that alleviate customer pain points.
Case Study: A Bank’s Triumph in Thailand
A titan in the Thai banking sector provides an awe-inspiring example of Value Proposition Canvas in action.
The bank aimed to bolster the financial well-being of the Thai populace. Here’s a brief sketch of how they employed the Value Proposition Canvas:
1. Customer Job
a. Input loan amounts
b. View loan conditions
c. Accept terms and conditions
2. Gain
a. Aesthetic and ease-of-use
b. Privacy
3. Pain
a. Difficulty in understanding loan limits
b. Overwhelming conditions
c. Tedious process
4. Product & Service
a. The app’s loan calculator simplifies loan transactions, offers an elegant design, and empowers customers with upfront credit limit information.
5. Gain Creator
a. Clean, intuitive design
b. Personal loan calculation feature
6. Pain Reliever
a. Minimized informational clutter
b. Expedited transactions
c. Proactive credit limit insights
The bank mastered the art of Value Proposition Design by engaging with their customers, analyzing their needs and hurdles, and delivering a product that wowed them.
If you wish to navigate the stormy seas of product development and emerge triumphant, mastering Value Proposition Design is not an option; it’s a necessity.
Morphosis is a digital product consultancy firm adept at steering businesses through uncharted waters, providing expert advice on customer analysis, value proposition design, and product discovery. Contact us to embark on a journey of transformative success with Morphosis today.
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