Solving pain points is not enough
Although there are already numerous articles and how-to guides on creating a strong value proposition, they often focus only on solving customer problems.
Contrary to popular belief, solving a painful problem for customers is hardly ever enough. You also have to win the market category you play in.
Core Value Proposition
In most cases, when people talk about value proposition, they mean their product’s core value proposition.
In simple terms, it’s the way your product addresses customers’ pains and needs. It’s the heart of the product.
Creating a relevant core value proposition comes down to answering the following questions:
- What are the jobs your customer is trying to get done? (customer jobs)
- What pain do they experience while doing so? (pains)
- What do they wish could be different or better? (gains)
Once that’s done, you build products and services that relieve those pains and create additional value for customers.
Category Value Proposition
Regardless of the core value proposition, your product also belongs to a specific market category and has to play by its rules.
Although it’s possible to create a brand-new market category, it’s exceptionally difficult. It’s usually better to fit into customers’ current way of thinking about products rather than trying to change the way they see the world.
A market category is a simplification users make when they encounter new products. People label products into well-known buckets.
People who learn about your product will usually associate with a group of products they already know or even use.
Let’s consider this example. You are building a communication and management app for IT professionals.
If your target customers perceive it as an advanced mail app, they will compare it to other mail applications and have somewhat similar expectations, such as:
- well-integrated calendar
- spam filters
- decent storage capacity
- contact list,
It’s a different story if your target customers see your product as a task management application. In this case, you’ll get by without a contact list, but you’ll be doomed without status management.
Discover what alternatives your customers compare your product with and whether this context suits your core value proposition or not. If it does, adjust your product roadmap to nail this market category. If it doesn’t, experiment with the value proposition and messaging to position the product in the context that works best.
Complete Value Proposition
When your product solves user problems while winning its market category, you have a genuinely robust and complete value proposition.
Addressing only the core value proposition might lead to a valuable and novel product, but it’d have a tough time crossing the chasm and reaching the mainstream market. It’s easier to meet people’s current expectations than try to change their beliefs.
Winning only the category value proposition might lead to a viable product, but without any unique value offering, you will drown in the red sea of competitors.
To sum up, to create a complete value proposition:
- Identify your target customer and discover their needs and pains.
- Build and test a core value proposition to fulfill these needs.
- Reach out to your most loyal customers. Understand what alternatives they compare you to and what market category they see you in.
- Understand the market category rules and expectations.
- Adjust your product to meet or exceed category expectations.
Truly great products solve relevant customer pain points while winning its market category.