Every startup has a value proposition at its core: a statement that describes what your product does for your users and what benefits they derive from using it.
When your startup is just an idea, the value proposition is basically a set of untested hypotheses. That is, you think you know which customers you serve, what job your product does for them, and how your product is valuable to them.
In this unit, we use the Value Proposition Canvas. It’s a simple one-page tool to capture and test each of these hypotheses and then use feedback from customers to refine it. This exercise is important. If you guess wrong and build a product that doesn’t do the job your customers need or doesn’t create enough value for them, they won’t use it, and you won’t have a business.
A value proposition has three elements:
- What useful jobs does your product do for customers?
- What pain are you solving for them?
- What gain are you creating for them?
Let’s look at each of these elements in detail.
Jobs to be done
You can view any product as a thing that gets a specific job done for customers.
It’s tempting to think of a product in terms of features, but it can be more useful to look at the jobs that it’s going to do. Customers are more interested in what outcome your product can achieve for them than what the product itself is.
The late Professor Clayton Christensen from Harvard University pioneered this concept by studying a wide range of products and asking, “What valuable job is this doing for the customer?”
A classic example: If you buy a drill, the job you’re interested in getting done is creating holes, which in turn might be because you want to mount a bookshelf on your wall. The job to be done by the drill is to create holes that enable you to mount your bookshelf. As a customer, you’re more interested in the outcome than the tool by which you achieve it.
The same concept can be applied to startups. If you think about your product from the customer’s perspective, you can ask, “What job is it going to do for my customer?”
Try the following story format as a way of expressing the job to be done from a customer’s viewpoint:
- When <description of the situation or context>
- I want to <description of the job to be done>
- So that <description of the outcome>
Let’s look at a simple example:
When I’m working on a new startup idea, I want to find out quickly whether it’s worth pursuing so that I spend my time on something that has a good chance of succeeding.
Task: Create a job story
Create a job story for your product by using the preceding format, imagining that you’re the customer. Remember that these hypotheses are about why your customers want your product to do a certain job and what that job is. You can test and validate these hypotheses only by talking to customers.
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