Friday, August 2, 2013

Better Value Proposition Development

Let’s define a value proposition

In its simplest terms, a value proposition is a positioning statement that describes for whom you do what uniquely well. It describes your target buyer, the problem you solve, and why you’re distinctly better than the alternatives.

One of the classic mistakes of building a value proposition is diving headlong into the solution definition phase before really understanding the problem you’re looking to solve. To understand whether it’s a problem worth solving, I  recommend exercising four U’s:

Is the problem unworkable? Does your solution fix a broken business process where there are real, measureable consequences to inaction? 

Is fixing the problem unavoidable? Is it driven by a mandate with implications associated with governance or regulatory control? For example, is it driven by a fundamental requirement for accounting or compliance? 

Is the problem urgent? Is it one of the top three priorities? In selling to enterprises, you’ll find it hard to command the attention and resources to get a deal done if you fall below this line. 

Is the problem underserved? Is there a conspicuous absence of valid solutions to the problem you’re looking to solve? Focus where there’s whitespace, not scorched earth.

Problems worth solving yield a decisive “yes” to the majority of these questions.

Next, ask yourself whether the problem is blatant and critical. Problems that are blatant and critical are far more acute that those that are latent and aspirational. Blatant and critical problems stand in the way of business. They put careers and reputations at risk and whiten knuckles. Latent problems are unacknowledged, which means they often require costly missionary selling. Aspirational problems are optional, which is the hardest of places for a B2B start-up to sell. Though in B2C, they can be drivers as people look for things like status or fashion.

Now that you’ve determined what problem you’re solving and validated its criticality, it’s time to define your solution. The most urgent question to ask is: What is your compelling breakthrough? 

 

*Written by another author

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