How you think launching a product is going to go:
- Come up with a great product
- Figure out who’s going to buy it
- Manufacture, market, and distribute
- Voila! Million dollar business.
That’s the idea that many product business owners have in their heads. But in reality, that method misses the mark.
If you’re not focused first on your customer’s needs, you’re playing a risky game. You need to make sure that your product is filling a need for customers. You need to understand why they would want to buy your product.
There is a tool that can help you figure that out— the Value Proposition Canvas. When used properly, it will lead you on the path to success— how to align your business with your customers’ needs.
Read on to find out what the Value Proposition Canvas is, why it works, and how to use it in your business.
What Exactly Is the Value Proposition Canvas?
Before you can use the VPC, you need to know what it is. It’s a business model tool created by Swiss business expert Alexander Osterwaller, creator of the Business Model Canvas.
This video explains what the VPC is and shows you how it works:
The VPC is specifically created to help you connect your value proposition (a statement that shows why customers buy from you) to the actual customer segment you serve.
In other words, it helps you understand who your customer is and why they need what you buy.
Why Do You Need One?
There are several benefits to using the VPC. The first is that it helps you get to know your customers better. You might be able to tell someone who your target persona is, but how well do you really know them?
Do you understand their pain points, their goals, and what they’re looking for? The VPC makes you get acquainted with your customers on a deeper level so you can make sure you’re serving them.
It also helps you make decisions in your business— the types of products you create, the way you position them, and the messaging you put into your marketing.
How Does It Work?
If you’ve never used the VPC before, it can sound overwhelming. But once you see how it works, it’s a simple tool to use!
The video below explains how you fill out the VPC:
The VPC has two main parts— the customer profile and the value proposition. Each one is broken down into these categories:
The Customer Profile:
- Customer jobs
The Value Proposition:
- Products and services
- Gain creators
- Pain relievers
You fill in the customer side first, then move onto the value proposition.
Filling in the Customer Profile
When you’re diving into the customer, you can’t just guess. You need to find out what your target audience truly feels. That means doing market research, asking questions, or even performing focus studies.
Here’s what you’re looking for:
These are the goals that your customers have— the root behind why they would want your product. For example, if you have a health food business, you know that your target customers want to eat healthy food. But why?
Do they want to lose weight? Do they want to feel better and have more energy? Do they want to avoid health problems?
Those answers dictate every move you make in your marketing— you have to get to the real core goals your customers have.
Dig in deep and get the real answers from your market research. You want to find out what your customer really wants from life— what motivates them? What emotional needs do they have? What societal goals do they have?
The pains are what’s keeping them from reaching those goals. If you’re a supplement brand and your customer’s goal is to gain more energy, the pain point might be that they don’t know how to fuel their bodies the right way. They’re not sure which products are the best and they feel overwhelmed.
If you run a beauty brand the customer’s goal is to feel confident and beautiful, the pain might be that they are feeling old and searching for a product to help them look good and feel younger.
You’re looking for what’s holding them back from what they want.
• What takes up their time?
• What struggles do they face?
• What societal pressures do they battle?
• What are they afraid of?
Gains are the benefits that help your customers reach their “jobs” or goals. That might be saving money, saving time, or getting certain features.
The gains will directly tie into the way you help them overcome objections and justify buying your products.
When you put all of those pieces together, you start to get a sense of what your customer is really looking for— their needs, their struggles, and their desires.
Here’s a video that walks through an example of the VPC in action!
Filling in the Value Proposition
Once you get a clear view of your customer, it’s time to move to the other side— the value proposition. You’ll fill this in based on what you learned from the customer profile.
You likely gathered a lot of information during your market research— you don’t need to focus on every individual pain, gain, or job. Instead, choose the top five of each that you think are the most important. That’s what you’ll focus on in this section.
Products and Services
Just write down what you offer— the products you sell, any bundles or packages, any special offers.
Here, you’ll fill in how your products can ease those pains you wrote into the customer profile. If they suffer from sensitive skin, do you offer a line with ingredients that won’t irritate them? If they struggle with losing weight because they love sweets, do you offer a delicious protein bar sweetened with Monk Fruit instead of sugar?
Finally, you’ll fill in how your products help them with their gains. What does your product offer as a bonus to your customers?
If they want to save money, maybe your products last longer and give them more value. Or maybe they want to feel healthy and your products give them energy. Maybe they want to look beautiful without the fuss and your products are long-lasting.
Does it Fit?
After you fill out both sides, there’s one more step in completing your VPC— making sure your value proposition fits the customer profile.
Do your products provide solutions to problems that the customer is facing? Do they offer benefits that the customer is looking for? Have you addressed their needs?
If the answer is yes, then you’re good to move forward! But if the answer is no, then you need to do some thinking.
If your products aren’t solving their problems and fulfilling their needs, then you either are selling the wrong products or you’re selling to the wrong people. (That’s why it’s so important to do this work early in your business!)
Once you’ve aligned your products to the customer’s needs, you can use the VPC to influence your messaging, your copy, and your marketing.
Highlight those needs and reflect why your products are the right ones to help your customers reach their goals!
Ready to dive in? Download our Value Proposition Canvas Guide for help! It includes examples, guiding questions, and a templated canvas to use!