Value Proposition and Customer Segmentation
In order to build a successful company, you must start at the very beginning. What problem will you be solving? What are you improving? What makes you better or more current than the business down the street? The very beginning of building a successful company is the value proposition—because if you don’t know what your business is bringing to the table, you don’t have a business at all.
When most people think about the definition of a value proposition, they think mainly about the features of their product. That is important, however there are two other ideas you must also entertain—the gains that you’re creating, and the pains that you are eliminating. I believe that the latter two ideas are the most important. Without adding value to your product through pains and gains, customers have no reason to exclusively use your product.
The features of your product, the gains you give your customers, and the pains you solve for your customers all lead up to what the value proposition is truly about: minimum viable product. This simply means that when producing your product, you are looking to take a set of the least amount of features you can have that gives the customer the best value. To do this, you have to get out into the world and talk to your customers. Oftentimes, start-up founders get in a mindset where they think their product is incredible and that customers will be completely beside themselves to own it. While it is important to believe in your product, you can’t be sure of any of that without going out and talking to the people you’re selling to. At the very least, talking to potential customers will give you a better understanding of why your product is so great. More often than not, however, customers will push you to some sort of pivot in your plan. They will tell you that there is a feature they hate, or a feature that you don’t have that they need. There is an endless amount of good information that...
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