6 Product Value Proposition Models for Product Managers
Your product’s value proposition is pretty darn important. It’s how you confirm the fact that this thing you’re working so hard on should actually exist, will find an audience, and – you know – make some money.
But you probably already know that. And you might already have a good idea of the various value talking points that your product has to offer your customers. What you might not know, however, is that there are a bunch of different ways to go about massaging yours into shape.
Product value statements come in many shapes and sizes, and sometimes in several different guises for a single product. But what they all have in common is that they’re the result of some serious thinking on the subject of purpose and benefit.
And, just like how a syllabus gives college classes a structure and a training plan makes a marathon seem attainable, it’s easier to position your product’s value if you run it through an established model.
A product proposition model is a framework for clarifying your salient points. It’s the product planning equivalent of pushing Play-Doh through one of those shape makers – all the constituent parts were already there, but now you have a star, instead of an amorphous lump.
So let’s make some stars. In this piece, we’ll run through seven of the best-established models and templates for encapsulating the value of your product, which you can use as a base to whittle down into something pretty stellar.
Product value proposition vs product vision statement vs slogan
Oof. I won’t lie: there’s overlap here. In fact, so much overlap that the frameworks, models, and results often seem quite similar. A slogan and a vision statement can both share elements ripped straight from a product value proposition statement for example. And, for all three, the resulting, written-down crux of your product can all sometimes form external, customer-facing copy.
And that kind of makes sense, because all of them suggest great things about your product in a way that’s easy to understand. But here’s how to look at it in simple terms:
Product value proposition
As Janna has said before, “product value is the qualitative benefit that a user gets from a particular product in satisfying needs, solving problems, and achieving goals.”
Product vision statement
Where you want your product to be, what you want to it achieve, and how that will change the market as a whole. This is your future vision for the product, essentially.
Slogan
The sexy stuff. The bit people remember. Billboard fodder. Your slogan is external, ad-style copy – usually no more than around 3-8 words.
6 killer product value proposition models
Ok, so how do you actually go about forming your product value proposition? The six models and templates we’ll cover are all fantastic exercises that will help you clarify exactly what you have to offer.
To help demonstrate things, we’re going to give an example for each value proposition model, based on a fictitious product.
Introducing the world’s most incredible new tech product: YouStop: an enterprise-level desktop app that makes an annoying noise whenever employees have spent too long procrastinating on YouTube. The free tier has one noise, with paid tiers offering various sounds and dynamic reporting for managers and CTOs. Its (imagined) big rival in the space is YouTube Alarm. And, yeah, it sounds a bit draconian but let’s run with it for now*.
We’ll fill out each model as though we’re trying to drill down into YouStop’s value proposition, to give you a better idea of what’s involved.
*This article is brought to you by… Lots of YouTube procrastination.
1. Crossing the Chasm’s six steps
Geoffrey Moore’s Crossing the Chasm has sold well over a million copies, so you might already be familiar with the six steps for crafting a value proposition cited in the book. It’s an oft-repeated model for good reason: while you won’t end up with anything particularly streamlined at the end of the process, you will have articulated your product’s value in no uncertain terms.
For those unfamiliar, it involves filling out the information in a six-part statement with the following prompts:
With our imagined product, that might look a little something like this:
‘For managers who are tired of their staff procrastinating, YouStop is a productivity tool that shocks staff into closing YouTube. Unlike YouTube Alarm, YouStop offers teams the ability to track app usage and generate reports about your employees’ video-watching habits.’
This actually helped form the basis for the way ProdPad creates product visions and we have a free interactive template that will help you write your own product vision here.
2. Value proposition canvas
Created by Dr. Alexander Osterwalder, the value proposition canvas is a two-pronged visualization tool designed to help you find a market fit for your product, based on what customers need.
The canvas is a super visual framework divided into two sides: Customer Profile (or segment) and Value Proposition. Each side has three sections that complement each other, where the aim is to fill out the customer side first and then find strong links between their needs and your offering.
The best way to do this is on a wall with a ton of Post-It notes for each section, but – all the same – let’s work through a basic version of the list in the diagram above based on our imagined YouStop tool:
Customer Profile
- Customer jobs (what they need to do)
Ensure that employees are efficient and working without distractions.
- Customer pains (what gets in the way)
Employees are watching too much YouTube on the job.
- Customer gains (what they want from a solution)
More efficient workers and a way to see who’s pulling their weight.
Value Proposition
- Products and services (what you offer)
YouStop!
- Pain relievers (how your product can help)
Shock employees into getting off of YouTube
- Gain creators (the benefit your product offers)
Track YouTubing downtime with customer reports.
3. The lean canvas
The lean canvas is part product value proposition model, and part entire business plan-on-a-page – and it’s a fantastic way of getting a whole bunch of thoughts about your product down in a way that can help you sum up its market fit and overall appeal. Developed by Ash Maurya, author of Running Lean, it’s an adaptation of the value proposition canvas described above.
Here’s how it looks:
| PROBLEM | SOLUTION | UNIQUE VALUE PROPOSITION | UNFAIR ADVANTAGE | CUSTOMER SEGMENTS |
| KEY METRICS | CHANNELS | |||
| COST STRUCTURE | REVENUE STREAMS |
Again, this is a great one to put up on the wall and collaboratively fill with Post-Its, but let’s fill it out digitally here with our YouStop example to help you understand how it might look:
| PROBLEM Staff watching YouTube all-day IT dept and managers have no idea who is most productive | SOLUTION A desktop app that makes a noise to scare people off of YouTube | UNIQUE VALUE PROPOSITION Ability to track staff YouTube usage and generate reports to show procrastination levels over time. | UNFAIR ADVANTAGE Market-leading insight into people’s workplace YouTube habits | CUSTOMER SEGMENTS SMEs and Enterprise IT/CTO Management Individuals (students?) |
| KEY METRICS – Alarms issued- Reports generated- Subscriptions | CHANNELS Content marketing plan goes here (TBC) | |||
| COST STRUCTURE Design and testing = $XXHosting = $XXPeople costs = $XXOur break-even point is XX customers | REVENUE STREAMS 90-day free trial free tier for individualsSubscription @ $XX per month. |
4. The ‘essential question’ triangle
Harvard Business School has taken the key parts of the value proposition and, like a good creative writing teacher, distilled things down into just a few prompts to help you put pen to paper. As they put it: “The value proposition is the element of strategy that looks outward at customers – at the demand side of the business.”
The three questions are interoperable, insomuch as they should feed into and affect one another:
- Who are your customers?
- Which needs will you meet?
- What price will provide value and profitability for you and the customer?
Worth noting: The price-point question comes into play once you have a good idea of the competition and how your offering can be competitive within the space.
Let’s fill them out with our example to see what this might look like:
- Which customers are you going to serve?
Managers and CTOs.
- Which needs are you going to meet?
Ensuring staff efficiency and providing transparency over YouTube habits.
- What price will provide value and profitability for you and the customer?
$XX per month, for X number of team members.
5. Help [X], to [X], by [Z}
Startup guru Steve Blank suggests that the value proposition conundrum can be easily solved by posing your product’s strengths in the form of an incredibly simple statement:
- ‘We help [X] to [Y] by [Z]’
It doesn’t get much simpler, but then that’s kind of the point. Steve also says it’s important to run this by people and play around with things until you really nail the sentiment:
“If you can’t easily explain why you exist, none of the subsequent steps matter,” he says. “Once you have a statement in that format, find a few other people (it doesn’t matter if they’re your target market) and ask them if it makes sense. If not, give them a longer explanation and ask them to summarize that back to you. Other people are often better than you at crafting an understandable value proposition.”
For our fictitious product, that statement might go something like this:
- ‘We help managers to ensure productivity by tracking and stopping YouTube overindulgence at work.’
6. Customer, Problem, Solution
The Entrepreneur’s Guide to Customer Development by Vlaskovits & Cooper cites three prompts that define your product’s place in the world – and its inherent value. Or, you know, potential lack thereof…
- Customer [who is your target customer?]
- Problem [what problem are they facing?]
- Solution [how will you solve the problem?]
As with others, this value proposition model puts the customer and their problem before your solution. The reason is simple: you can’t come up with a product and then retrofit it to a pain point. You need to identify the pain point first, and then work to solve it.
Ok, one last time, let’s run YouStop through that particular propositional mangle:
- Customer [who is your target customer?]
Managers and CTOs.
- Problem [what problem is the customer currently facing?]
YouTube is a blocker to staff productivity.
- Solution [how will you solve the problem?]
A tool that stops people procrastinating on YouTube, with reports on usage.
3 examples of amazing product value propositions
The value proposition models above are all frameworks for getting your product’s strengths and market fit down on paper, but they’re not necessarily the final form your statement will take. Many companies take these templates and use them to sculpt the resulting words into something a bit more palatable, sellable, and fun.
And, as Peter Sandeen puts it, often you’ll “have more than one value proposition.”
Think of it like this: everything you put out into the wild should be working to position your product’s value. This means that while having one catch-all sentence that sums things up is great, there’s less pressure on carving that into stone than there is on being able to convey that value every time you talk about your product.
To show what we mean, let’s take a look at the different ways some of the world’s leading companies have taken the proposition value idea and put their own spin on it.
Airbnb
Airbnb exists to create a world where anyone can belong anywhere, providing healthy travel that is local, authentic, diverse, inclusive, and sustainable.
Airbnb’s value proposition here is a version of the ‘help [x], to [y], by [z]’ template. It’s stating that it can help ‘anyone’ to ‘belong anywhere’ by ‘providing healthy travel that is local, authentic, diverse, inclusive and sustainable.’ And while we’d probably say there are two too many things in that list (because people love things in threes), it works by being all-encompassing.
Slack
Making work simpler, more pleasant, and more productive.
Slack actually has a bunch of different phrases that work interoperably as slogans and value props. For example, “be less busy,” and “Slack makes it downright pleasant to work together” – both promoting similar ideas in different ways, and both capable of acting as internal and external messaging.
Stripe
Payments infrastructure for the internet.
Stripe’s proposition statement is, on the surface, a bit dull. But what it’s managed to do here is say a lot with a little. The ‘customer’ here is the whole internet, while their unique solution isn’t a niche sub-area; the company is positioning itself as infrastructural and therefore integral. Like, it is to payments what roads are to cars. Word of warning: If you’re gonna be this bold, you’d better be really good at what you do.