The Value Proposition Canvas (developed by Dr. Alexander Osterwalder) is a great product development tool for startups and entrepreneurs. It provides a detailed look into the relationship between two broader parts of the Osterwalder's Business Model Canvas: customer segments and value propositions. It makes sure that a product focuses on the customer needs and desires!
The Value Proposition Canvas is all about the customer so creating one starts with them. If you target more than one market segments (personas) you need to have a separate Value Proposition Canvas for each one.
This section looks at the customer profile, focusing on three things. What the target customers want to get done, the tasks they want to complete, and the problems or needs they want to satisfy. You can fill out this section by sketching a customer profile.
Customer pains are the undesired situations, costs, negative emotions, and risks that the customer may encounter. This could be at any stage of getting the job getting done, including before, during, and after.
When sketching this section, rank each of the customer's pain based on the intensity it presents to the customer. Also indicate how often the pain occurs and the degree of intensity.
In this section, describe the expected benefits, customer desires, or surprises. This may include social gains, functional utility, cost savings, and positive emotions.
Once you have identified the gains, rank them according to their relevance to the customers. Consider which ones are insignificant and which ones are substantial, then indicate how often each occurs.
This section focuses on the value proposition. Start by listing the products and services that your value proposition is built around.
Rank the products and services based on the importance: whether the customer considers them trivial or crucial.
The focus of this section are the functions and characteristics of your products and services that alleviate the customers' pains. Think of how they reduce and eliminate negative emotions, customer risks, and undesired situations and costs before, during, and after getting the job done.
Once you have identified your pain reliever, rank them based on the intensity for the customer. Determine whether they are intense or light, and indicate how often they occur.
The last section describes how your products and services create gains for the customer. Think of what functions and attributes create the benefits that your customer desires, expects or would be pleasantly surprised by. These may include functional utility, positive emotions, social gains, and cost savings.
Once you have identified the gains of your products and services, rank them based on the relevance they have on the customer. Determine which ones are substantial or significant, then indicate how often each occurs.
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