Value Proposition

A Value Proposition is a quantified analysis of the benefits and costs incurred by a customer when that customer accepts the companies offering.

Costs and benefits can either be perceived and/or actual. The perceived costs and benefits are greatly influenced by the credibility of the company and the believability of the offering. It helps when customers have experience with the product or service. The trick with selling a Value Proposition is that you talk about making money (saving money), not about spending money and that you can substantiate your claim by research reports, endorsements, testimonials, user reviews, test-drives etc.

Compare your value proposition with the following scenarios:

  • Customers use what the are using now
  • Customers stop using what they are using now
  • Customers switch to available alternatives
  • Customers buy into your proposition

Customer Value = Benefits / Costs (in the perception of the customer)

Benefits can be created by product features, the user experience or other product/service benefits that are of value to the customer. Costs are the sacrifices your customer needs to make to enjoy your benefits. These sacrifices may consist of; mustering the confidence that everything will be al right, taking the time to understand the value proposition, learning how to use the product or service and paying the price for the product or service.

Value Proposition Canvas

Edible version!

Value Proposition Canvas
Customer Experience:
Job to be done:
Customer Group:Alternatives:
Value Proposition:Assumptions:
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