How to find the value?
Value Proposition Design: How to Create Products and Services Customer Want.
Value Proposition workshop (RBA)
We were lucky to participate in a workshop at RBA run by Joe Pacal. He is a design thinking master, who knows how to ask the right questions and how to facilitate the brain from chaos towards a clearer vision. When we started working with these exercises, we had the idea and some kind of a solution in our mind, but we knew at that point it was just a scratch from the topic we were trying to decode. We weren’t sure how we would be able to create value for the customers. To get the answer, we needed to get to know our users. We knew that we were going to target university students, but that wasn’t enough.
When starting to identify the user segments, it is important to have the mind rolling with different types of people. With us, we just had students divided into different groups based on their study field. It was a start for sure, but it really doesn’t tell anything valuable about our target audience in that form. That’s why we needed to change our focus on the widest possible variety of students as possible to start off with. With different kinds of exercises, we started narrowing the groups smaller until we had only a few types of strong customer profiles left.
Don’t know where to start? Use the post office exercise
Have a blank paper and do two circles, one smaller one in the middle of the paper and a bigger one around the smaller circle. Start writing all different kinds of people to post-it notes and add them to the paper. Locate the post-its in a way, that those who seem typical and are easy to understand from your perspective near to the middle and those who didn’t cross your mind as fast and easily to the outer circle. A middle–aged woman with kids, sending a letter would go to middle whereas a nomad getting their letters would possibly go near to the edge. Try to play it out and be as detailed and imaginative as possible, throwing all kinds of people in it. This is an exercise where you should totally isolate your own problem and solution. Instead, let your ideas flow and give your brains a rest from all the hard work!
Isn’t it weird in a way to both trying to understand your own customers but yet not thinking about the correlation at this point at all? And why post office as the location of this exercise? Why not choose a place where you think your audience would much rather go? If we think about this referring to our own idea, we probably would have chosen a school as the location. Choosing the obvious location, we will automatically narrow down the types of people we think of. This could result in us looking past potential customer segments. And this is the reason why we need to start with a much wider perspective; to steer our mind towards a state where we are open to new ways of addressing the solution.
Play with narrowing and going bigger with your thoughts
After thinking bigger, we should again narrow down all the thoughts we have just produced. Start by clustering all data you have into different segments under bigger headings based for example on a mutual interest or another common factor. Then throw away those ones that clearly don’t make any regarding your idea. Now at this point, you should still have at least five different groups that could make sense to your idea in some way. To narrow the content from here even more so to viable data, add filters. These could be money, motivational backgrounds, personal interests, or whatever you can come up with. Of course, these filters can also be cleared based on the factors you are looking for. After narrowing once more, choose a different icon for each group. These could be a euro symbol, heart, and star.
Now start placing these icons to the different segments. Our idea would have left business students, startup enthusiasts, teachers, and coaches. We can now place all of our heart icons on one segment or all to different ones. After you have placed all the icons to the paper, you count where you have the most icons. That will be your main target audience. Now that you have defined the main target audience, you need to start building the first layer of empathy. Even the target group is already small and pretty narrow, there is still a huge variety of needs and pains within the group.
Have a blank paper and draw one line vertically and one line horizontally in a way that they divide the paper into four segments. These segments you want to name “Customer”, “Ache”, “End Result” and “Solution”. Instead of just jumping in and filling these empty spots in random order and through the first ideas that pop in your mind, start writing on post-it notes all the “aches” you think the customer segment is having. This is the time to ditch your problem – solution idea from your head and think big. Write down all the things that aren’t related to your problem. Try to think of the person as a whole.
Now you should have a huge pile of aches on the paper as detailed as possible, for example: “Doesn’t want to attend on networking events because he/she is an introvert and doesn’t like the situations where he/she needs to talk to strangers”. Now group these aches and reflect what you found out. Are some groups clearly bigger than others? If at this point new ideas start emerging, write them down. Utilize the flow and dive really deep into your brainstorming. By now, you probably have some sort of an idea what this certain person would be like.
Next start filling the “customer” part. Visualize and go into details. Write down the gender, name, age, where does he/she live, where does he/she come from? Relationship status, family members, maybe a pet? Is the person working? If so, where? What kind of hobbies does he/she have? What are the person’s interests? Does the person love dancing or online shopping? Write all of these down! After having a clear image of the person, jump on to “solution”. Think of the hopes and goals the person might think or want to fix the aches. If the person doesn’t like networking events, would they want to network rather online?
Finally, it’s time to move to the “End result” section. Remember to still calm your mind of not thinking too much about your solution. Imagine a situation where all the aches you noticed could be fixed. How would the person feel? What would the emotions and actions be as a result? Use the sticky notes to write these down. Again, be precise.
Journey mapping enables you to dig even deeper into the pains and gains of the person.
Think of the path starting from the pains the person feels and build the road towards a goal, which is your solution. What drives the person to the problem you are trying to solve? What happens when and if they realize the problem? What are the first steps to make a change? What are the steps between the first step and finally reaching the goal?
How could your solution tackle with the pains that came up with the exercises made? What kind of features will it have? What is your value proposition?
To find this answer, you need to understand the jobs your customer needs help with. These jobs are divided into two: functional jobs and social jobs. A functional job is something the customer needs to do, such as buying groceries. The social job is something the customer wants to do in order to impress others, such as buying a trendy outfit. To better understand the customers’ aches, think of the obstacles that interfere with the customer of getting either of these two jobs done. These obstacles are the fears of an unwanted outcome, environmental obstacles such as not having enough money, and the risks that keep the customer from working. After this, you must understand the three gains the customer is hoping for: required gain (the product does what it promises), expected gain (the product is reliable and well made), and finally desired gain (the product goes beyond expectations). For functional jobs, solutions should often be focused on how to save the customer’s time and money. For social jobs, it is all about making people feel good about themselves and raising self-confidence.
Osterwalder et al. 2014. Value Proposition Design: How to Create Products and Services Customers Want. O’Reilly Media.
Pacal, J. 2020. Value Proposition Workshop 28.2.2020. Red Brick Accelerator.