As an entrepreneur looking to start and grow a business, one of the most important things you need to do is to define and understand your value proposition. Your value proposition is, essentially, the value you are offering to customers. It is the thing you do or offer that is so valuable that people are willing to give you money in exchange for it. It sounds simple, but defining it can sometimes be tricky. To help us define ‘it’, let’s consider the following questions:
- Are you offering a product, a service, or both?
- What problem(s) does your product or service solve?
- How will customers benefit as a result of using your product and/or service?
By answering these questions, we can begin to define exactly what it is you are/will be offering your customers, and how they benefit as a result of using your product or service.
To help clarify how to answer these questions, let’s look at a couple of examples.
- Are they offering a product, a service, or both? Answer: product(s). Itsi Bitsi offers cupcakes, homemade gelato, and gifts.
- What problem(s) do they solve? Answer: A customer wants a cupcake, or a cupcake-inspired gift.
- How will customers benefit* as a result of going to Itsi-Bitsi? Answer: Itsi-Bitsi gives customers a convenient and easy way to get delicious cupcakes or gifts for whatever they need them for.
*A benefit differs from a result or outcome. In this example, the result or outcomes are the delicious cupcakes or gifts. The benefits to the customer are convenience and time savings.
- Are they offering a product, a service, or both? Answer: service. Surgical procedures.
- What problem(s) do they solve? Answer: A patient needs to have surgery.
- How will customers benefit* as a result of going to Halton Healthcare? Answer: Their patients have a better quality of life as a result of this service.
*In this example, the result or outcome is the surgery. The surgery causes patients to have a better quality of life.
www.businessforbeginners.ca is a business and marketing blog to educate and inspire people who want to start a business idea, but aren’t sure how to make things happen. Visitors can learn basic business concepts and through examples and practice exercises, be able to apply it their own business idea or project.
- Are they offering a product, a service, or both? Answer: both. A product (business information/advice) and a service (consulting services to help with a specific problem or project).
- What problem(s) do they solve? Answer(s): A person has the industry expertise and enthusiasm to start a business, but doesn’t know enough about business concepts, or how to apply the business knowledge they have to their own idea.
- How will customers benefit* as a result of going to BusinessForBeginners.ca? Answer: BForB visitors will be able to apply the business knowledge they’ve learned to their idea to get their project moving.
* In this example, the result or outcome is the business and marketing knowledge. The benefit is that visitors will know how to apply it to their idea, and be able to move their business idea forward.
People will pay for your product or service because it adds value to their life, or solves a problem for them. Focus on providing value and you’ll be well on your way.
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