You've probably heard a lot about the Lean approach. This approach is perfectly supplied by the popular Business Model Canvas - one of the most widely used concept for the creation of a business model that identifies determiners of the value proposition. Its author, a Swiss business researcher Alexander Osterwalder, decided to create one more model, which is devoted to a detailed understanding of customers’ needs and their satisfaction. This model is the Value Proposition Canvas.
What is the Value Proposition Canvas?
Value Proposition is focused on customers and their requirements. This tool is widely used by tutors and trainers to look at the fit between products or services and potential customers.
How does it work?
The Value Proposition Canvas includes two basic parts:
- Customer segment that is usually placed on the right side. This is your customer for whom you intend to create value.
- Value Proposition segment that is located on the left. Here you place the points that help you attract customers.
The canvas demonstrates a parallel between your product (or service) and your customers' needs.
The customer segment assists you to clarify your customer profile understanding with a value map.
The profile includes:
- Customers' jobs that your customers try to complete.
- Pains (the negative aspects the customers may face while trying to complete their jobs).
- Their gains and positive outcomes.
The value proposition describes the features of a specific value proposition in a more detailed way. Your value proposition is divided into:
- Products and services that can be digital, financial, tangible, etc.
- Pain relievers are how your products or services can soften the customer pain.
- Gain creators are how your customers can benefit from your offer.
Product managers, working with this methodology and its every block, can use suggestive questions that will help to reveal the essence of each block more quickly and efficiently. The article Questions for Working with Value Proposition Canvas will help you learn more about them.
A successful result is when the features of your value proposition map directly match the characteristics of your customer profile. This is the fit.
This fit can be achieved with the following steps:
- You identify relevant pains, jobs and gains of your customers to address them with your value proposition.
- Your customers give you positive feedback.
- You find a profitable business model.
What is the advantage of Value Proposition Canvas?
This powerful marketing tool helps to totally understand what customers want. The Value Proposition Canvas helps in creating products and services that perfectly match their needs.
With its help, product managers can easily collect customer information in a simple way. That allows a more effective design of a business model.
How to build Value Proposition Canvas using Hygger?
Easy! Friendly Kanban boards can serve as the basis for creating your VPC:
As a result, if the method is successfully applied, you will get something like the following formula:
Our __ helps __ that want to __with the help of__and__unlike others
Want to find out more about the method? These resources should be helpful:
- The Startup Owner's Manual: The Step-by-Step Guide for Building a Great Company by Steve Blank and Bob Dorf
- Lean B2B: Build Products Businesses Want by Étienne Garbugli
- Value Proposition Design: How to Create Products and Services Customers Want by Alexander Osterwalder