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Value Proposition - Entrepreneurship 101 (2012/2013)
The document discusses the concept of a value proposition, detailing its significance as a statement of the unique benefits offered to target customers. It emphasizes that a value proposition should not be confused with an elevator pitch, tag-line, or mission statement, and provides a structure for creating effective value propositions. Additionally, it outlines the importance of testing these propositions through customer interviews and market research to validate their effectiveness and relevance.
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Value Proposition - Entrepreneurship 101 (2012/2013)
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- 3. Agenda What is avalue proposition? Examples Dimensions of value Customer interviews The value proposition generator
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- 5. How to (not)articulate value:
- 6. A value propositionis a statement of the unique benefits delivered by your offering to the target customer
- 7. A value propositionis 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: marketplace) before money is put into scaling.
- 8. Value Proposition isNot: An elevator pitch: a 30 second conversation starter I buy dead magazines… We un-think marketing…
- 9. Value Proposition isNot: A tag-line: an ad compliment We know money What Happens Here, Stays Here The City That Never Sleeps Built for the road ahead
- 10. Value Proposition isNot: A mission statement: a statement of the purpose of your business. The University of Toronto is committed to being an internationally significant research university, with undergraduate, graduate and professional programs of excellent quality. Google's mission is to organize the world's information and make it universally accessible and useful
- 11. The value propositionstatement 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
- 12. What is it? Examples: For whom? Values? Good: Winners is a Bad: Winners is an department store that off-price department offers fashion conscious store owned by TJX consumers the latest that employs brand names for up to international 60 per cent sourcing and buying off. (Winners) power.
- 13. What is it? Examples: For whom? Values? Good: Winners is a Bad: Winners is an department store that off-price department offers fashion conscious store owned by TJX consumers the latest that employs brand names for up to international 60 per cent sourcing and buying off. (Winners) power.
- 14. What is it? Examples: For whom? Values? Good: A1 Industries has Bad: A1 Industries developed an economical has discovered a and easy-to-use chemical chemical isomer additive that allows paint additive that allows manufacturing companies for a reduction of VOC to reduce the emissions. environmental impact of their products
- 15. What is it? Examples: For whom? Values? Good: A1 Industries has Bad: A1 Industries developed an economical has discovered a and easy-to-use chemical chemical isomer additive that allows paint additive that allows manufacturing companies for a reduction of VOC to reduce the emissions. environmental impact of their products
- 16. What is it? Examples: For whom? Values? Good: Google is the Bad: Google uses a world s largest search patented page- engine that allows ranking algorithm to internet users to find make money through relevant information ad placement. quickly and easily.
- 17. What is it? Examples: For whom? Values? Good: Google is the Bad: Google uses a world s largest search patented page- engine that allows ranking algorithm to internet users to find make money through relevant information ad placement. quickly and easily. Are Internet Users really Google s customers?
- 18. What is it? Examples: For whom? Values? Good: Google is the Bad: Google uses a world s largest search patented page- engine that ranking algorithm to automatically provides make money through advertisers with ad placement. potential customers tailored to the ad content, increasing click-through rates and conversion rates.”
- 19. Selling to Selling to Customer Business Usability Health Lower risk Aesthetics Saving time Status Saving/making money Newness Enabling function Self-Actualization Convenience Environmental Quality Ethical Social Inclusion Customizable
- 20. Selling to Selling to Customer Business Usability Health Lower risk Aesthetics Saving time Status Saving/making money Newness Enabling function Self-Actualization Convenience Environmental Quality Ethical Social Inclusion Customizable
- 21. Selling to Business Lower risk Saving time Saving/making money Enabling function Convenience Quality Customizable
- 22. Selling to Business Lower risk Saving time Saving/making money Enabling function Convenience Quality Customizable
- 23. Selling to Business Lower risk Saving time Saving/making money Enabling function Convenience Quality Customizable
- 24. Selling to Business Lower risk Saving time Saving/making money Enabling function Convenience Quality Customizable
- 25. Selling to Business Lower risk Saving time Saving/making money Enabling function Convenience Quality Customizable
- 26. Selling to Business Lower risk Saving time Saving/making money Enabling function Convenience Quality Customizable
- 27. Selling to Business Lower risk Saving time Saving/making money Enabling function Convenience Quality Customizable
- 28. Selling to Business Lower risk B2B Sales: Saving time Saving/making money - Rational Enabling function decision making Convenience Quality - Overt values Customizable
- 29. Selling to Selling to Customer Business Usability Health Lower risk Aesthetics Saving time Status Saving/making money Newness Enabling function Self-Actualization Convenience Environmental Quality Ethical Social Inclusion Customizable
- 30. Selling to Customer Usability Health Aesthetics Status Newness Self-Actualization Environmental Ethical Social Inclusion
- 31. Selling to Customer Usability Health Aesthetics Status Newness Self-Actualization Environmental Ethical Social Inclusion
- 32. Selling to Customer Usability Health Aesthetics Status Newness Self-Actualization Environmental Ethical Social Inclusion
- 33. Selling to Customer Usability Health Aesthetics Status Newness Self-Actualization Environmental Ethical Social Inclusion
- 34. Selling to Customer Usability Health Aesthetics Status Newness Self-Actualization Environmental Ethical Social Inclusion
- 35. Selling to Customer Usability Health Aesthetics Status Newness Self-Actualization Environmental Ethical Social Inclusion
- 36. Selling to Customer Usability Health Aesthetics Status Newness Self-Actualization Environmental Ethical Social Inclusion
- 37. Selling to Customer Usability Health Aesthetics Status Newness Self-Actualization Environmental Ethical Social Inclusion
- 38. Selling to Customer Usability Health Aesthetics Status Newness Self-Actualization Environmental Ethical Social Inclusion
- 39. Selling to Customer Usability Health B2C Sales: Aesthetics Status Newness - Emotional decision making Self-Actualization Environmental Ethical - Latent values Social Inclusion
- 40. Selling to Selling to Customer Business Usability Health Lower risk Aesthetics Saving time Status Saving/making money Newness Enabling function Self-Actualization Convenience Environmental Quality Ethical Social Inclusion Customizable
- 41. Process: Draft avalue proposition Version 1.0: I think A1 Industries product/service will…
- 42. Process: Test yourvalue proposition State your hypothesis Test Verify problem hypothesis Test product Blank, Steve Four Steps to Epiphany concept
- 43. Understanding customer problems: ¢ Market research methods for entrepreneurs Pretend to be the customer Customer Interview Program Lead user QFD - Quality Function Deployment Primary Customer archetype Market ¢ Methods that require professionals Research Concept testing Cojoint analysis Empathic deisgn Prototype/Beta testing
- 44. Get out ofyour office!
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- 46. 1. The Probleminterview Purpose: To determine that the problem you are solving is a large pain point for the target customer 2. The Solution interview Purpose: To determine that the solution you have proposed is of value to the target customer and they are willing to pay to solve the problem sin that way.
- 49. Quantitative Analysis 30-60 interviewsare considered statistically significant. Consider infographics: Identifying customer problems n = 59 45 40 35 30 25 20 15 10 5 0 Sharing takes External No free time time demand
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- 51. Qualitative Analysis High-value testimonials: “There is nothing more important to me than sharing memories with my family.” “I can’t tell you how frustrating it is to post photos and videos to, like, three different platforms every week cause my uncle doesn’t understand how to use Dropbox.”
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- 53. Day in theLife Scenario Before Current Problem situation encountered & & desired economic outcome consequences After Ernie: Enabling New fixes factors of outcomes and airplanes your economic product rewards
- 54. Secondary Market Research 1. Access to reports/data from 20 databases 2. Access to industry analysts through inquiry Industry specific time Multiple Industry vendors coverage vendors IDC Frost & Sullivan Forrester BCC Research Gartner Total Patents Lux Research Delphion/Thomson Cleantech Group LLC Innovation Aggregator of Thomson Pharma other vendor Datamonitor MedTrack resources Venture Source Business Insights Chemical Abstracts IMS Dialog Pro Market Research Factiva Meltwater News U of T- $ 50 M Key: Red – ICT collection Green – Cleantech & Nanotech Blue – Life Sciences
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- 65. Process: Test YourMVP Validate: Confirmed value of MVP State your hypothesis Iterate: change your product Test features Verify problem hypothesis Verify Test product concept Exit: Don’t spend any more money! Blank, Steve Four Steps to Epiphany"
- 66. Minimum Viable Product A minimum viable product is a product launched to early adopters that has only the minimum set of features required to get feedback from potential customers.
- 67. Whole Product A whole product is the combination of all the things that give your customers a compelling reason to buy. This includes not only your core product, but also any services and ancillary products that augment it.
- 68. Iterations in theMarket Whole Product" VALUE" Progress is iterative" Minimum Viable Product" TIME"
- 69. Iterations in theMarket State your hypothesis Test Verify problem hypothesis Test product concept
- 70. The value propositionstatement should consist of these components: 1. What your product/service is 2. The target customer 3. The value you provide them Write – Test – Iterate Prototype – Test - Iterate
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