A value proposition is a fancy way of noting what you offer your customers. It’s always best to start with your customers in mind when creating a new product because you’re designing your product for the consumer. This isn’t always as obvious to some companies as you would think. If your product doesn’t suit customers’ needs, then you aren’t going to have many sales.
A value proposition can help you get completely clear on what it is you want to offer your target customers. Keeping consumers in mind while you create your value proposition is essential to help you create better products.
There are five types of value involved in a value proposition, and each one can help you create products your customers want. The five types of value are:
- End value
Functional value focuses on the problem you are solving for your customers. How does your product make their lives easier? What purpose does your product serve? Your product must solve a problem for your consumer if it’s going to sell. If you can clearly demonstrate the problem your product solves, then you’ve created functional value.
The value inherent in emotions relates to how customers feel about your brand. You want them to become attached to your brand so they will become loyal shoppers. How will customers feel when they use your product?
Economic value is all about money. Do your customers feel like they are getting good value for their money when they buy your product? If your product is less expensive than competitors’ products, then consumers will see it as having economic value because of this financial advantage you’ve created for them.
What does your company stand for in the minds of your customers? Consumers want to feel like they are purchasing products from companies that are doing good in the world. Social responsibility comes into play here too. Consumers like to know that companies have considered the impact they have on the environment and are taking steps to make the world a better place.
End value relates to customer satisfaction. If customers are confident they will be happy with the products they purchase from you, then you’ve created end value. Offering a guarantee goes a long way toward creating end value. To create end value, it’s important that you clearly communicate what the customer will get when they purchase from you.
Creating an effective value proposition that incorporates each of the five types of value will help you create better products, because consumers are going to see those products as solving a problem, making them feel good, and saving them money–all while originating with a company that provides great value and cares about its impact on the world.
Pivot International is a product design, development, and manufacturing firm with strengths in software development, electrical engineering, mechanical engineering, and industrial design. Pivot also offers a number of business development services to help you build a business around your products. To learn more about how Pivot can help you create effective value propositions and better products, contact us today.