Recently, when we’ve been working with our clients on their Value Proposition, we’ve found a few frustrations creeping in . We don’t always seem to be getting the impactful statements we’re aiming for. It’s taken us a while to figure out why that might be, and now we think we’re ready to share that.
First of all, let’s recap what’s good about the Value Proposition Canvas…
The Value Proposition Canvas is a tool used by entrepreneurs and innovators to assess and articulate the value they offer to their customers. The canvas provides a visual framework for aligning the key elements of a value proposition across the customer’s needs, the product or service offering, and the unique benefits provided.
One of the main strengths of the Value Proposition Canvas is its focus on the customer. When we start with a deep understanding of the customer’s needs and pain points, the canvas helps us ensure that the value proposition is tailored to the customer’s perspective and addresses their key concerns. This customer-centric approach can deliver value propositions that truly resonate with customers.
Another benefit of the Value Proposition Canvas is its simplicity and flexibility. The canvas is easy to use and understand, making it accessible to teams of all sizes and levels of experience.
So far, so good! But now let’s start to look at some of its limitations and weaknesses…
Limitations of the Value Proposition Canvas
While the Value Proposition Canvas is a useful tool for aligning products and services with customer needs, it has significant limitations that reduce its effectiveness in many situations. One major limitation is that it often becomes too focused on the product or service offering, overlooking other factors that contribute to a value proposition such as pricing, distribution, branding and emotional aspects. When creating our value proposition we need to be sure to consider each of these aspects to arrive at something that truly resonates with customers.
Let’s take a closer look at these limitations with some concrete examples.
1. Emotional Value in B2C Brands
Take a luxury clothing brand like Gucci or Louis Vuitton for instance. The value that customers get from these products often comes from emotional fulfilment or the status that comes with being associated with the brand. Owning a Gucci handbag isn’t just about the quality of the material or craftsmanship; it’s about the prestige, exclusivity, and recognition that come with it. This kind of emotional and status-driven value is tough to capture on the Value Proposition Canvas, which mainly focuses on functional aspects.
2. B2B Products and Complex Value Propositions
Now let’s think about B2B products. For example, a software company providing an enterprise-level data analytics platform. In this context, the value isn’t just about the features and capabilities of the product, but also things like the quality of customer support, how well it integrates with existing systems, and scalability. These aspects are crucial for business clients making long-term investments, but they aren’t easily represented on the Value Proposition Canvas, which tends to focus more on the immediate gains and pains of the end-user.
3. Different Roles and Perspectives
Another example involves products or services where multiple people in different roles have different “jobs” to do. Think about a scenario involving both a worker and a manager. For instance, a piece of industrial equipment might be used by a worker on the factory floor, but the decision to buy the equipment is made by a manager or procurement officer. The worker values ease of use, safety, and efficiency, while the manager is more concerned with return on investment, maintenance costs, and reliability. The Value Proposition Canvas struggles to capture these different perspectives effectively, since the end-user’s needs are very different from those of the decision-maker, making it hard to develop a value proposition that addresses both.
4. Early-Stage Innovators and Rapidly Changing Needs
And most importantly from our point of view, working with early stage intrapreneurs, the Value Proposition Canvas also isn’t a great fit where the customer’s needs and pain points aren’t well understood or are rapidly changing. In these cases, the canvas does not give enough guidance or support for innovators to develop effective value propositions. For these types of businesses, Design Thinking techniques can be more effective for understanding customer needs and iterating towards a strong value proposition.
So, What To Use Instead?
Alternative approaches to developing value propositions include customer journey mapping, empathy mapping, rapid prototyping, and customer transformation modelling. These methods offer a more holistic and customer-centric approach, incorporating a wider range of factors that contribute to a value proposition.
If you’d like to find out more about how you can build these techniques into your innovation processes – please get in touch.
When To Use (And NOT Use) the Value Proposition Canvas
To wrap up, let’s be clear, the Value Proposition Canvas has its place. We particularly like it as a tool for product managers incrementally adding features to an existing product or service. In this scenario, businesses usually have a clear understanding of their customers’ needs and pain points, and can use the Value Proposition Canvas as a simple and flexible way to see how new features map to customer goals.
However, if you are an intrapreneur developing a new B2C product or innovating in B2B situations where the customer’s needs are complex, we find that alternative approaches are often more effective.
