Innovation 6 Value Proposition

Name some properties that create great value propositions:

1. Are embedded in great business models 2. Focus on jobs, pains, gains that mater most to customers 3. Focus on unsatisfied jobs, unresolved pains, unrealised gains 4. Target few jobs, pains, gains, but do so extremely well 5. Go beyond functional jobs and address emotional and social jobs 6. Align with how customers measure success 7. Focus on jobs, pains, gains that a lot of people have or that some will pay a lot for 8. Differentiate from competition on jobs, pains, gains that customers care about 9. Outperform competition substantially on at least one dimension 10. Are difficult to copy

What are some ways of coming up with Customer Gain Creators?

1.figuring out how your products and services create customer gains 2. Outlining outcomes nad benefits that customers will expect/desire or would be surprised by. 3.functional utility (social gains, positiive emotions, cost savings etc) 4.focus on relevant gains for the customer segment

What is a Value Map?

A list of all the products and services a value proposition is built around.

Name come MSP's

Console manufacturers (Microsoft, sony, Nintendo) Visa credit card system Google Facebook Microsoft windows News papers e.g. financial times

What is an open business model pattern?

Creates and captures value by systematically collaborating with outside partners.

What are 3 categories of business model pattern?

Customer Relationship Product innovation Infrastructure business

What are supporting jobs of Customer Segements?

Customers also perform jobs in the context of purchasing and consuming value either as consumers or as professionals.

What is problem Solution fitting?

Evidence that customers care about certain jobs,pains and gains Design a value proposition that addresses those jobs, pains and gains.

What is an example of a freemium model:

Flickr/linkdin/ Red Hat

What is the bait and switch model and give some examples of it :

Free inexpensive initial offer turns customers into repeat purchasers. Skype Razor and Blade: Gillete

What are 4 types of customer pains?

Functional (e.g. a solution doesn't work, doesn't work well or has negative side effects) Social ("I look bad doing this") • Emotional (" I feel bad everytime I do this") • Ancillary ("It's annoying to have to go to the shop for this")

What are Customer Jobs?

Functional Jobs Social Jobs Personal/emotional Jobs Supporting Jobs

What is a product market fit?

Having evidence that your products services, pain relievers and gain creators are actually creating customer value and getting traction in the market

What is Business model fit?

Having evidence that your value proposition can be embedded in a profitable and scalable business model.

Why can 'free' work as a business model?

In an MSP business at least one substantial customer segment is able to continuously benefit from a free of charge offer. Non payers are financed by another part of the business e.g. adveritisng.

Give an example of an open business model pattern:

Innocentive acts as a connector. Provides scientists with access to rewards for solving challenges Provides companies with access to skills they don't have in hosue.

What does a Multi Sided Platform business do?

It facilitates interaction between different interdependent groups of customers. It grows through a network effect

Explain what Long tail business model pattern and - power law of distribution is

It's the idea that classic retailers will stock the most popular products but there is an almost infiitne number of product that are not very popular with the mass market but have niche buyers. With e commerse it is possible to now store a lot of niche products in a warehouse somewhere to be purchased when requested.

What is the point of a value proposition canvas?

Mapping a Value proposition to fit onto a customer profile.

What is an example of a free MSP that works

Metro newspaper

What are the 3 stages of Fitting for a Value Proposition Canvas?

Problem Solution Fitting Product Market Fitting Business Model Fitting

What are the different types of customer gains?

Required (smartphone must be able to make calls) Expected (we now expect smartphone to be well designed and look good) Desired (we desire smartphones to be seamlessly integrated with our other devices ) Unexpected (go beyond customer expectations and desires. They wouldn't come up with them even if you asked them

What is the chicken and the egg effect regarding Multi sided platform businesses?

The platforms are only of value to one group of customers only if the other groups of customers are also present. E.g. console manufacturers have to draw as many players as possible to attract game developers, but players will only buy hardware if there are enough interesting games available for the console.

Why are Amazon, ebay, google, itunes and Netflix Long tail companies? What makes it possible?

They all serve both the mass market but also Niche markets and they are able to do this because of the ability to store their products (digital or physical) and sell it when needed.

How do MSP's get over the chicken and egg dilemma?

They subsize one of the customer segments to attract one so the other will also come.

Name 5 types of Business model patterns

Unbundling business model Long tail model Multi-sided platform model Free as a business model Open business model

What does a Value Proposition Canvas focus on?

Value Proposition and The Customer Profile

What do you look for in Value Proposition Canvas (Value proposition)?

We describe the Value Proposition in terms of Products and Services and also the Gains it creates for the customers and the Pains it relieves.

What are Customer Pains?

What annoy customers trying to get a job done or prevents them getting the job done. Undesired outcomes, problems and characteristics.

What is a business model pattern?

reusable business model architectural components, which can be used in generating a new business model

What do you look for in Value Proposition Canvas (customer Segment)?

we describe the customer segment in terms of Jobs the customer has to do, the Pains he/she is feeling in the jobs, and the Gains the customer is looking for

What are Personal/emotional Jobs of customer Segments? when your customers seek a specific emotonal state, such as feeling good or secure, e.. Seeking peace of mind about one's investments or achieving the feeling of job security at work

when your customers seek a specific emotional state, such as feeling good or secure, e. Seeking peace of mind about one's investments or achieving the feeling of job security at work

What are functional Jobs of Customer Segments?

when your customers try to perform or complete a specific task or solve a specific problem e.g. mow the lawn, eat healthily as a consumer, write a report or help clients as a professional

What are Social Jobs of customer Segments?

when your customers want to look good or gain power or status. These jobs describe how customers want to be perceived by others, e.g. look trendy or be perceived as competent

What are the 3 Jobs that arise from Supporting Jobs in Customer Segments?

• Buyer of value: jobs relating to buying value, such as comparing offers, deciding which products to buy, completing a purchase or taking delivery • Co-creator of value: jobs relating to co-creating value with your organisation, such as posting product reviews and feedback or helping design a product or service • Transferrer of value: jobs related to the end of the value proposition's life cycle, such as cancelling a subscripion, disposing of a product, transferring it to others, or reselling it