The Value Builder helps you to build great value propositions by ensuring that your product or service meets the needs of your customers. First, define the ‘customer perspective’ by writing down what your customers want, what their desirable outcomes are and what they wish to avoid. Then, formulate your ‘product perspective’ by describing the benefits of your product or service. Examine these perspectives side by side and find ways to improve your value proposition. In this way, you can be confident that you are offering products and services that customers really want.
Download the Value Builder and print out the large page to use for a brainstorm session with your colleagues. To see how the Value Builder can be applied in practice, download the Example for Airbnb.
The goal of the Value Builder is to help you understand how well your intended/existing product or service matches customers’ needs. It can help you develop an attractive value proposition.
Step 1: Customer goals in context
Start by clearly identifying your target market – who are your intended customers? – and describing the context in which they use your product or service. Your market may comprise consumers and/or companies. Next, define your customers’ goals and tasks. Goals can be functional, related to getting a job done or solving a problem. Or your customer’s goal can be emotional to look or feel good or to be entertained or pleased. A task is a functional action to be done, for example buying groceries, watch a movie, taking a course, regularly exercising or writing an article.
Step 2: Desirable outcomes and things to avoid
Consider what your customers need or desire in order to achieve their goals. Which outcomes are welcome and what do they wish to avoid?
Anything that makes customers happy is potentially a desirable outcome. Consider what could facilitate them to achieve their goals or complete their tasks? Or even improve the experience? What might your customers dream about? Write down the desirable outcomes you can come up with.
Things to avoid
Anything that hinders customers from achieving their objectives or completing their tasks, or that irritates them during this process, should be avoided from a customer perspective, e.g. a long queue, a noisy environment, a slow internet connection, a lack of transparency, or a bad feeling after consuming foods or beverages. Write down the things a customer would like to avoid in the context of reaching his goal or performing his task.
Step 3: Your product or service
Define your ‘product perspective’; list the main and supporting product(s) and/or service(s) that your business offers that seek to help your customers achieve their goals and perform their tasks.
Step 4: Functional and emotional benefits
Next, consider which functional or emotional benefits your product or service provides your customers.
Functional benefits are effectively what customers get from products or services, i.e. solutions for achieving their goals or performing their tasks. These solutions should produce desirable outcomes, but may also incur side effects customers prefer to avoid. Benefits may relate to performance, experience, cost savings or convenience. They may facilitate customers to complete tasks or to overcome challenges. What benefits do your products/services offer that help achieve desirable outcomes or avoid undesirable ones?
Emotional benefits concern what customers feel in relation to products or services, e.g. feeling stylish or invigorated, or having peace of mind. Your customers may feel proud to support a sustainable, ‘green’ product or service – they may even experience positive social consequences as a result of buying or using it. Write down the emotional benefits of your product. Emotional benefits can create desirable outcomes or avoid undesirable ones.
Step 5: Evaluate customer/product fit
Determine if there is a fit between what the customer wants and what your product provides. Do the benefits of your product or service achieve the customers’ desired outcomes and/or remove undesirable ones? If there is only a partial ‘fit’, consider which benefits you could add to address unserved outcomes, or which benefits your customers might not actually want or care about.
Tip: Put checkmarks next to the desirable outcomes and things to avoid, and the functional and emotional benefits to indicate how well they match.
Step 6: Describe your customer segment and value proposition
Review your customer and product perspectives and the customer/product fit exercise. Then attempt to clearly describe your customer segment and the value proposition of your business. The customer segment description should be a summary of the customer perspective. The value proposition description should summarise your products/services and the value, i.e. benefits, that they provide. The customer segment and the value proposition form the core of your business model.