“Every feature has some maintenance cost, and having fewer features lets us focus on the ones we care about and make sure they work very well”. – David Karp
Why does it matter?
As it is well-known any kind of business in order to succeed has to be able to answer 2 questions:
-What are the pain point of my target group? (Problem)
-How I can effectively address them? (Solution)
If and only if they have a problem-solution fit (the foundation for attaining well-known and much-needed product-market fit) they will have a chance to survive in any hyper-competitive market.
If we assume that you are convinced of the usefulness of one of the recommendations that were given in one of posts Be one of your target group and you decided to adopt it, I can assure you that the 1st question is almost answered by just taking that strategic decision.
If we assume that we have a good understanding of our market (2 core components that compose that statement; know your Target group pain point and the existing available solutions), it’s time to attempt figure out what kind of solution is needed to be created by our startup for the desired product-market fit objective.
By creating the well-known Value Proposition element; Essentially is the value you intend to deliver to your target audience (target group).
In any kind of startup the Value Proposition is the single most important part that entrepreneurs need to come up. Is the reason which will make the customer say; either I want one of them or to categorize you in the “me too” category, namely nothing of interest because it brings nothing new or better in the market (saturate product).
However, the methodology that will be utilized by us for the creation of our Value Proposition will go against the mainstream process and we’ll employ one of the most powerful tools for cross-validating our Value Proposition before even launch it to the market.
It seems cool right? (I hope so……!)
Or in other words find out soon enough if our Value Proposition resonates with our qualified audience (target group).
Value Proposition core components
In order to come up with our Value proposition, we have to make sure we understand which elements are needed for doing so:
a) Define our niche market
Which is the niche market that you intend to operate in?
Related Article: From Market Zero To Market Hero; Did You Do Your Homework?
b) Target Group Pain Points
What are the problems/needs of your specific target group?
c) Available market solutions
What options are currently available in your market niche?
d) Our differentiation factors/ competitive edge (it’s covered in our “Beginner’s Guide to startup differentiation”)
How you solution is better or different from your rivals?
e) Determine which would be the main features of your “product”
Which would be yours product specification elements?
f) Convert those features into customer benefits
How those features are translated to clear, tangible and immediate benefits that your target group will receive and be willing to pay for?
g) Create a product vision
Transform those benefits into a clear vision (no more than 4 lines). How the core benefits of your solution will change your target customer life and resolve their problems or fill their needs.
If you fail to answer how your solution will have a profound change to your customer’s life, you have to go back to square one and figure out what is missing.
Think how is the life of your customer now with the current solutions and how it would be when you appear in the market. Can you see in any difference?
h) Create a Value Proposition for an MVP
Select only 3-4 core features/benefits of your initial Value Proposition for the purpose of been used in our MVP Value Proposition
Just think which are the least possible features that could generate customer satisfaction and create an MVP that incorporate them.
How to create a killer Value Proposition that your Prospects can’t refuse
Now that we covered everything that needed to be covered and put the foundation is time for the special sauce that brings the much-desired virality (offer that can’t be refused).
1st Key Concept: Deliver immediate benefits superior to its cost
This proved to be by far the most powerful way startups can accomplish that goal in history. Easier said than done, but is an element that if included in our potential offer is a game changer.
I want to be clear, in order this concept to work we have to take out from the equation any subjectivity. We have to clearly make the maths and figure out if the equation prove our assumption. If in your business model hypothesis you say that you intend to charge for that product $60 let’s say.
Can you prove that your product will bring immediately more value (more than $60) immediately? Immediately is the magic word, not sometime but right away.
Of course it’s a challenging task, but is what distinguish viral products from the average ones.
I will give one example of such offer to back up that point with a story. Chris Guillebeau in his best-selling book ($100 startup) share a story about a viral coupon offer.
2 guys in that story created a coupon book with a pile of offers (to be exact 130 coupon offers). Nevertheless, what distinguish that offer from all the other coupon offerings was that with a single only coupon they offset the price that the customers had to pay ($100).
The books contained deals for helicopter and flight tours that cost several 100 dollars and hotels that retailed at more than $100 a night. Why wouldn’t people pay $100 for a product like that? If you are travelling to Alaska there is almost no reason why you wouldn’t want one of their books. –Chris Guillebeau
How did they do that?
I have no idea…., but it’s up to us to figure out if it’s possible to integrate that key concept to our offer.
Is it possible? Yes, Is it easy? No, Can we do it? It depends….on us.
2nd concept: Fill a pain that is so unbearable that will jump immediately
Thereby, you have to find the right audience.
Which is the right audience? One that pain would not be in the category “It would be nice if I have it, but one that craving for a solution because their status quo is driving them crazy”.
In the same book ($100 startup) Chris Guillebeau shares a story when he was running in a marathon, he was in the end of this run and he was exhausted. All of a sudden a spectator some meters along the road offered him a slice of orange. As Chris said
The piece of orange it was an offer that I couldn’t refuse; even though it was free, I would have gladly paid for it if I had the money.
Namely, the need was so pressing that he didn’t even think about it, he just grabbed it and will be “eternal” grateful to the spectator.
I would use again the same phrase.
Is it possible? Yes, Is it easy? No, Can we do it? It depends…….on us.
If we know so well our target segments it’s easy to recognize the pressing point, but not so easy to come up with an idea and convert it to a real product.
3rd concept: Don’t try to create demand, fill demand is much easier
This concept from Tim Ferriss was incorporated in our process (it was indicated above) but it’s super important to not forget and apply it. Is the silver bullet that we are looking for, to find the problem and figure out how to address it. Fundamentally without having the product-market fit everything else is hallucination.
As Tim Ferriss put’s it:
The product needs to solve a problem that causes pain that the market knows that it has. It’s easier to sell to someone who knows that they have a problem and they are convinced that they need a solution than it is to persuade someone that they have a problem that needs solving.
Thank you again for reading and spending a small part of your time with my post, I appreciate it a lot. If you enjoyed and found useful this blog post, please share it using the buttons below!
“A field full of brown cows is boring. A purple cow violates the viewer’s expectations, which naturally attracts Attention and interest”. -Seth Godin.