This article is part of a series of articles called 'Survival of the Quickest: Reinvent, Innovate or Die'
If paying customers are the heart of a business then value proposition is the blood that keeps it alive and pumping. In simple terms, value proposition is the reason why customers pay you and not your competitors. Unlike earlier days when there were only a few competitors for a service or a product and all enjoyed a good piece of the pie, competition now is tough with low barriers for new entrants.
How do you add value to your idea so that a customer cannot refuse? The only way that can be done is if you truly understand your customer’s daily life, routine, challenges, pain points and solve a problem or satisfy a need.
Questions that we need to answer for this pillar are:
What value do we deliver to the customer?
Which one of our customer’s problems are we helping to solve?
Which customer needs are we satisfying?
What bundles of products and services are we offering to each Customer Segment?
Let’s use our case study example of our healthy snacks made from locally grown Nagpuri oranges to answer the above questions.
1) What value do we deliver to the customer?
To understand the value of our product, I conducted a small research on the benefits of oranges. Here are my findings –
We all are aware of the high content of vitamin C in oranges. However, what good is an orange and vitamin C anyway?
- Just one orange provides 116% of daily vitamin C value required by the body which is known to reduce the risks of colon cancer
- Vitamin C is the only water soluble antioxidant in the body and helps prevent cold, ear infections, asthma and arthritis
- Nutrients in orange peel have the potential to lower cholesterol more effectively than prescription drugs with no side effects
- Excellent source of fiber which helps in keeping sugar levels low
I don’t know about you but to me that’s a pretty amazing snack!
2) Which one of our customer’s problems are we helping to solve?
Heart disease is the most common problem amongst Indians. Our lifestyle choices that include increase in meat consumption, lack of exercise, untimely meals are all contributing to this phenomenon. The number 1 killer of Indians is Heart Attack and the number of deaths is going to double in 2015.
A World Health report called ‘Diet Nutrition & Prevention of Chronic Diseases’ claims that daily diet that includes citric fruit (oranges, tangerine etc) reduced the risk of stroke 4-5 times more than any other fruit or vegetable.
Help fight hunger and replace junk snacks. We all have days where between meetings and deadlines we do not get a chance to eat our meals at the right time. We end up munching on unhealthy snacks like chips, cookies or our favourite samosas. A healthy snack bar is a convenient portable snack that you can carry along with you in your bag to the office and snack on it when you are starving but in a crunch time. Although this is not a meal replacement it is definitely better than the unhealthy junk snack between meals.
3) Which customer needs are we satisfying?
We are satisfying two of our customer’s needs – Nutrition and Convenience.
4) What bundles of products and services are we offering to each Customer Segment?
In this case, we only have one customer segment
Here's my business model template for this week.
Next Article in the series: Channels
About The Author:
Akhil Dua is an IT entrepreneur in Nagpur working on launching MarriageWise; a safe online portal for people looking to remarry. Visit his blog.
He studied at Florida International University, Miami and worked as a Manager for Deloitte Consulting. He quit his consulting job to start a health food business before returning to India. He loves the Indian outdoors and is currently planning his annual white water rafting trip to Rishikesh. You can contact him at email@example.com.
Akhil's Twitter ID: http://twitter.com/duaakhil
You may also like to read
- Survival Pillar # 5: Discovering revenue streams for your business
- Survival Pillar # 4: Build Long Lasting Customer Relationships
- Survival - Pillar #1: Customer Segments
- Survival Pillar # 3: Channels
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