How to design the perfect Value Proposition Canvas – 7 steps

What is the Value Proposition Canvas?

The Value Proposition Canvas is a tool for making your value proposition more compelling. It has been developed by Alexander Osterwalder and Yves Pigneur. The goal is to discover if and to what extent there is overlap between your audience and your products and services. The model is used in business strategy, new product development, and marketing.

Why use the Value Proposition Canvas?

It helps you identify what your customers really want and need, and then show how your product or service can give it to them.

A value proposition can be referred to as a USP (unique selling proposition). It’s the reason your product exists and the difference it makes in people’s lives. The canvas helps you to map out what you are trying to build and how it can be different from other products in the market. A value proposition canvas helps you define why customers should buy from YOU rather than someone else by answering 3 questions: Who? Why? What does your product do for them? The 7 steps in this article will help you to answer these questions in the right way.

Connect the market to your solution with the Value Proposition Canvas
Value Proposition Canvas

How is the Value Proposition Canvas build up?

The canvas contains two parts: the customer profile (circle) and value map (square). The customer profile is about the customer: what do they want? The value map on the other hand is about your solution: what do you offer them?

STEP 1. Customer segment: What customer group could benefit most from your solution?

Before you directly start with filling in the fields of the Value Proposition Canvas, you first want to pick the customer segment. The customer segment is the group of people you want to sell to. The more specific the segment, the more focused your value proposition will be. So instead of keeping it general like ‘entrepreneurs in professional services’, you want to make it specific like ‘solo coaches with an hourly rate between €175-600’.

A great way to think about your customer segment is by using an example from your own life. If you’re a photographer, for example, what kind of clients do you want? Are they business owners or high school students? Do they need event photography or family portraits? Your ideal client might not be a specific profession at all. It could be someone who needs help cleaning up their home after a move or organising their office supplies.

Asking yourself questions like these helps define who exactly should see and use your product: They have something in common with each other that makes them share similar needs and problems (in this case, moving). This will make it easier for you when developing features and benefits later on!

STEP 2. Jobs to be Done: Which main tasks could you help your customers with?

The job to be done is a term coined by Clayton Christensen (in his book The Innovator’s Solution), which refers to the reason a customer buys your product. This approach suggests that people don’t buy products; they hire them for a job – and if you can figure out what that job is, then you have the key to building a successful business. It’s what they want to get out of using it.

For example, if someone buys an electric toothbrush, their job may be “to remove plaque from my teeth so that my dentist doesn’t yell at me when I go for my next cleaning.”

Jobs to be done can be functional, social, or personal. By making this distinction, you’re less likely to forget about important jobs to be done. Examples of functional jobs for a solopreneur could be to create content, determine your audience, time management, and acquiring new clients. Social jobs are focused on gaining power/status, like positioning yourself as the expert or differentiating yourself from all of the other providers in the market. Personal jobs are about pursuing an emotional state, like getting more confident in selling yourself.

STEP 3. Customer pains: Which main problems are your customers facing?

To begin, you’ll want to identify the problem that the customer is experiencing. Ask yourself, what’s going on in their lives that makes this pain so painful? This could be something like “I am constantly frustrated with how difficult it is to communicate with my team members.” Or perhaps something more specific, like: “Whenever I travel and leave my laptop behind, I cannot gain access to important documents and spreadsheets.”

Next, consider what context(s) might make this pain worse. In other words, what are some situations where this person would be especially motivated by a solution? Maybe they’re working remotely or on-site; maybe they’re traveling for work or leisure; maybe they’re at a conference and have trouble connecting with people who don’t have an internet connection; etc. If there’s no context of interest here (e.g., if there isn’t much travel happening), then skip ahead.

Pains could include unwanted results/problems/characteristics, like not having enough customers, little revenue, and having little free time due to time-dependent work. It could also include obstacles to start (due to an unclear value proposition) or continue (doubts about your audience choice). Next to unwanted results/problems and obstacles, you could also think about any risks for your customers.

STEP 4. Customer gains: Which main benefits are your customers looking for?

Gains are the benefits that your product or service offers to customers. They are what your customer gets from buying or using your offering, and they’re the reason why they buy or use it.

Gains are often intangible but may be both short-term and long-term: a short-term gain might be that a customer feels more relaxed after using your product, while a longer-term gain might be that they stop getting headaches when they work on their computer.

Gains can include things like saving money (e.g., by buying an item on sale), experiencing pleasure (e.g., eating chocolate), making money (e.g., selling something online), being healthier/more relaxed etc., depending on what’s important to you as an entrepreneur or business owner.

STEP 5. Products and services: Which main products and services do you offer?

The products and services you offer your customers are the tangible offerings you provide them. Products are the things you sell, such as a pair of shoes or a copy of your book. Services are the things that you do for your customers, such as writing an article on travel hacking or giving advice on how to start a business.

Products and services can be physical (book), virtual (online course), or intangible (content marketing strategy). They can range from simple (like a sign up for your newsletter) all the way to very complex (like getting an investment manager).

STEP 6. Pain relievers: In what ways can your product make it easier for your customer to solve their problems?

The pain relievers are the benefits and promises of your solutions. It can be anything that will reduce the pain which your customers are experiencing. They are often quick fixes and provide relief from pain while they work on a more permanent solution. An example of this is buying ibuprofen when you have a headache, or getting new tires when your car has been making noises for awhile. Pain relievers can also be services like fixing a computer network if it’s experiencing problems, or providing someone with therapy so they can cope with stress better.

Other examples would be a money-back guarantee, practical tips for more customers, or a roadmap for determining the right target audience.

Pain relievers can be tangible (like a product feature) or intangible (like a service). For example, if your solution is “I will give you advice on how to get better at tennis” then one pain reliever might be “I’ll show you how to improve your serve”. Or if it were more like “I will help you get into shape by giving personal training sessions once a week” then one pain reliever might be “I’ll make sure everyone has access to healthy food at home so they don’t have to go out for pizza all the time”. A pain reliever can also be connected to your sales process, like having a money-back guarantee in place.

STEP 7. Gain creators: In what ways can your product make it easier for your customer to get access or stimulate the benefits?

Gain creators are the actions or processes that create a benefit for your customers. For example, if your solution is a better way to manage customer data, then one gain creator might be “organize customer information” (i.e., grouping all client info by category). Another gain creator might be “automate data entry”, which would eliminate the need for a human being to physically type information into spreadsheets, databases and other tools.

Gain creators can also be intangible; for example, if you own an online business selling shoes then one of your gain creators could be “give customers personalized recommendations based on their purchase history and preferences”. This is an example of how companies like Amazon use algorithms to suggest products they think will appeal to each customer who visits their site.

Your best next steps

Those were the 7 steps for designing your Value Proposition Canvas the right way. It’s smart to use your filled in Value Proposition Canvas for all of your marketing expressions, from your landing pages to your email marketing campaign. Also, you want to use it for making a strong elevator pitch about your business/product. Ideally, you want to use storytelling instead of just stating out the jobs, pain(s) (relievers), gain(s) (creators), products.

Furthermore, if you would like to integrate your assumptions and insights of this exercise to your business, I recommend you to also work out the Business Model Canvas. After also filling in the complementary Business Model Canvas, everything falls nicely together. Check out my previous article (by clicking here) to fill in your Business Model Canvas.

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