Value Proposition - Entrepreneurship 101 (2013/2014)

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This lecture focuses on the process of creating a crisp and concise value proposition for your start-up. Learn how to answer the essential question, “What is the value you bring to your customers?” without describing the details of your technology.

Formulating a good value proposition is an essential step for any start-up and lies at the core of many of the other tools entrepreneurs need to develop, including market analysis, business modeling, finding funding and delivering an investor or customer pitch.

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Value Proposition - Entrepreneurship 101 (2013/2014)

  1. 1. " " Joseph Wilson @joeatmars jwilson@marsdd.com
  2. 2. Agenda What is a value proposition? Examples Mission Statement Elevator Pitch Tag line Positioning Statement Metaphors
  3. 3. How to (not) articulate value:
  4. 4. A note on language: You are a translator volatile organic compounds cache-coherence DRM, LAMP monetize incentivize osteoblast service-dependent sublayer X
  5. 5. A note on language: Show, don’t tell amazing state of the art revolutionary groundbreaking awesome landmark innovative sensational breath-taking disruptive cutting edge ideation X
  6. 6. A value proposition is a statement of the unique benefits delivered by your offering to the target customer
  7. 7. A value proposition is a hypothesis that your offering will bring certain values to a target customer. * * Like any hypothesis, it needs to be rigorously tested in the lab (read: with customers) before money is put into scaling.
  8. 8. Value Proposition is Not: A tag-line A mission statement An elevator pitch A positioning statement A positioning metaphor
  9. 9. Mission statement Tag-line Metaphor Value Proposition Elevator Pitch Positioning statement
  10. 10. Marketing Marketing Marketing Core Thesis Marketing Marketing
  11. 11. Mission statement Tag-line Metaphor Value Proposition Elevator Pitch Positioning statement
  12. 12. The value proposition statement should consist of these components: 1. What your product/service is 2. The target customer 3. The value you provide them Emergent property: why your product is unique
  13. 13. Examples: What is it? For whom? Values? Good: “Winners is a department store that offers fashion conscious consumers the latest brand names for up to 60 per cent off.” (Winners) Bad: “Winners is an off-price department store owned by TJX that employs international sourcing and buying power.”
  14. 14. Examples: What is it? For whom? Values? Good: “Winners is a department store that offers fashion conscious consumers the latest brand names for up to 60 per cent off.” (Winners) Bad: “Winners is an off-price department store owned by TJX that employs international sourcing and buying power.”
  15. 15. Examples: What is it? For whom? Values? Good: “A1 Industries has developed an economical and easy-to-use chemical additive that allows paint manufacturing companies to reduce the environmental impact of their products Bad: “A1 Industries has discovered a chemical isomer additive that allows for a reduction of VOC emissions.”
  16. 16. Examples: What is it? For whom? Values? Good: “A1 Industries has developed an economical and easy-to-use chemical additive that allows paint manufacturing companies to reduce the environmental impact of their products Bad: “A1 Industries has discovered a chemical isomer additive that allows for a reduction of VOC emissions.”
  17. 17. Examples: What is it? For whom? Values? Good: “Google is the world’s largest search engine that allows internet users to find relevant information quickly and easily.” Bad: “Google uses a patented pageranking algorithm to make money through ad placement.”
  18. 18. Examples: What is it? For whom? Values? Good: “Google is the world’s largest search engine that allows internet users to find relevant information quickly and easily.” Bad: “Google uses a patented pageranking algorithm to make money through ad placement.” Are Internet Users really Google’s customers?
  19. 19. Examples: What is it? For whom? Values? Good: “Google is the world’s largest search engine that automatically provides advertisers with potential customers tailored to the ad content, increasing click-through rates and conversion rates.” Bad: “Google uses a patented pageranking algorithm to make money through ad placement.”
  20. 20. Selling to Customer Usability Health Aesthetics Selling to Business Lower risk Saving time Status Saving/making money Newness Enabling function Self-Actualization Convenience Environmental Quality Ethical Social Inclusion Customizable
  21. 21. Value Prop Template: For _____target audience________, __company name_______ has created __product name___ that results in ___value 1_________, __value 2____, ____value 3__.
  22. 22. Mission statement Tag-line Metaphor Value Proposition Elevator Pitch Positioning statement
  23. 23. Elevator pitch: A 60 second quick pitch that describes the business. Hook Problem Solution (value prop-ish) Unique Features Call to action
  24. 24. The Hook: “I buy dead magazines…” “We make conferences not boring….” “We sell 15 minute vacations…” The Problem: “What do you mean?” “Paper based magazines are failing…” “Conferences are usually based on one-way lectures….” “People’s commute to work is stressful…”
  25. 25. The solution: “We buy up print magazines that are failing and reinvent them on the web as digital publications. For traditional small magazine publishers my company Solid Media provides an online template called digipub which repurposes their print material for online consumption at lower cost and opens up their content to a new crop of advertisers.
  26. 26. The solution: What is it? For whom? Values? “We buy up print magazines that are failing and reinvent them on the web as digital publications. For traditional small magazine publishers my company Solid Media provides an online template called digipub which repurposes their print material for online consumption at lower cost and opens up their content to a new crop of advertisers.
  27. 27. The solution: “We buy up print magazines that are failing and reinvent them on the web as digital publications. For traditional small magazine publishers my company XYZ Media provides a platform called digipub which repurposes their print material for online consumption at lower cost and opens up their content to a new crop of advertisers. Unique features: “We add the e-magazines metadata into our recommendation engine, kind of like Amazon, which brings in new readers.” Call-to-action: “Hmmm, good idea” “We’re signing up beta customers now to play around with the platform and tell us what they think. Check it out” [hands out business card]
  28. 28. Mission statement Tag-line Metaphor Value Proposition Elevator Pitch Positioning statement
  29. 29. Positioning statement: a value proposition plus a competitive anchor. For traditional small magazine publishers my company Solid Media provides a template called digipub which repurposes their print material for online consumption at lower cost and opens up their content to a new crop of advertisers. Unlike Press Publisher 4.0, digipub adds metadata to your content, connecting you with new readers and new advertisers.
  30. 30. Positioning statement: a value proposition plus a competitive anchor. For traditional small magazine publishers my company Solid Media provides a template called digipub which repurposes their print material for online consumption at lower cost and opens up their content to a new crop of advertisers. Unlike Wordpress, digipub is for magazine publishers alone to repurpose their content and discover new readers online.
  31. 31. Mission statement Tag-line Metaphor Value Proposition Elevator Pitch Positioning statement
  32. 32. Metaphor: a way to anchor your brand to something people already understand “digipub is like Shopify for magazines.” “digipub is to the magazine industry what Kobo is for books.” “digipub is like Wordpress for Magazines. “digipub combines the metadata from Amazon with the templates in Wordpress specifically for magazine publishers.”
  33. 33. Mission statement Tag-line Metaphor Value Proposition Elevator Pitch Positioning statement
  34. 34. Tagline: a marketing line to accompany your brand name “digipub: Reimagine Your Magazine.” “digipub: Print is Dead. Long Live Print.” “digipub: Follow Your Readers Online.” “digipub: Bits are Cheaper Than Pages.” “digipub: Where Magazines Live Online.” 2 3 4 5 1
  35. 35. Mission statement Tag-line Metaphor Value Proposition Elevator Pitch Positioning statement
  36. 36. Mission statement: a statement of the purpose of your business. “Google’s mission is to organize the world’s information and make it universally accessible and useful.” “Facebook’s mission is to give people the power to share and make the world more open and connected.” “Solid Media’s mission is to connect curious readers to the very best written content on the web.”
  37. 37. The sound-bite cheat sheet Value Prop Magazine industry End readers Media “For magazine publishers…” “For magazine readers…” “For magazine readers…” Elevator Pitch “I buy dead magazines…” “Did you used to read a magazine that went out of print?...” “Just last week we saw in the news…” Positioning “Unlike Print Publisher…” “Unlike print magazines” “Unlike print magazines” Metaphors “…like Print Shopify” “like Wordpress…” “like Wordpress…” Stats “ROI in 4 months” “3,500 magazines online waiting to be discovered…” “40% print media out of business”
  38. 38. Joseph Wilson @joeatmars jwilson@marsdd.com

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