Over the past few articles we have developed a better understanding of our target customer. While SDG Games products likely will appeal to a very broad audience of Christian families, we’ve decided to focus first on the busy homeschooling Christian mom who wants to integrate faith, learning, and fun for her family. In this article, we’re going to explore whether we have a value proposition that fits that mom’s desires.
The Lean Startup process identifies three critical “fits” that a successful startup moves through on its way to a sustainable business:
- You achieve Problem-Solution Fit when you understand a specific problem that specific customers have and you have identified a specific viable solution to that problem.
- You achieve Product-Market Fit when you have launched your solution as a product or service and the target market has validated that they value the product as demonstrated by significant traction (sales).
- You achieve Business Model Fit when you have successfully created a scalable and profitable business to deliver the solution to the market.
One of the huge benefits of taking a Lean approach is that you don’t invest in the next level of fit until you’ve tested and proven that you’ve achieved the current fit. So, for example, you don’t invest in launching a product until you’ve validated that you have identified a viable solution to a real customer problem.
In Value Proposition Design¹, Alex Osterwalder and team defined a value proposition as “the benefits customers can expect from your products or services.” In that book, they shared the Value Proposition Canvas (VPC) as a helpful tool in documenting a complete value proposition.
Or rather, a nearly complete value proposition. Their model captured the products and services offered and how the company delivers value in a way that helps create the gains and eliminate the pains that the target customer associates with the jobs they are trying to do. However, I think that the VPC is missing two critical components. The first is an easy to communicate statement of the value proposition and the second is an indication of the way that the company will always stand apart from competitors.
With those shortcomings in mind, I have developed the Customer Value Map (CVM):
The Customer Value Map starts with the Customer Profile we have been working with over the past few chapters, adds on the Products/Services, Value Creators, and Pain Killers (similar to the VPC), and also indicates the Market Discipline. The Market Discipline² indicates the foundational basis for competition by the company whether that be operational excellence, product leadership, or customer intimacy. Finally, the CVM summarizes the company’s value proposition in the form of a simple positioning statement.
Over the past few articles, we’ve developed the left half of the Customer Value Map. We first developed a draft Customer Profile, with our initial hypotheses for the customer persona, her jobs, her anticipated gains, and the pains that hinder the achievement of those gains. We then forced ourselves out of our comfort zone and engaged with real people to test and refine the hypotheses. In this customer discovery process, we more deeply understood the customer and developed empathy for the task before her.
Similarly, we can’t simply draw up the right half of the Customer Value Map on a whiteboard and declare that we’ve achieved Problem-Solution Fit. No, our initial draft will be a set of hypotheses that need to be tested. Once again we need to get out of the building and engage with customers.
I won’t belabor the process that we have followed for SDG Games. I think the extended descriptions I provided for developing the Customer Profile in previous articles give you a good sense for how to engage with customers and gain their insights. I will, however, reemphasize the importance of not mixing Customer Discovery with Value Proposition validation. Hearing from customers about their jobs, pains, and gains must not be tainted by introducing into the customers’ thoughts the unique capabilities you are developing. First you hear from them about their current situation. Later you can share your proposed solution and get their reaction.
For the SDG Games Value Proposition, I specifically used interviews/conversations, Facebook group questions and discussions, and sharing early product prototypes with Christian families to get their reactions and to validate the hypotheses.
Below is the Customer Value Map for SDG Games. The left half is the Customer Profile that we defined in our last article. The right half reflects our value proposition.
Starting in the top right of the value proposition, ours is a Product Leadership business. We don’t expect to be the lowest cost provider of games to this market (that would be an Operational Excellence discipline), nor do we expect to custom produce games to meet the unique needs of each customer (that would be Customer Intimacy). Instead, we will continuously seek to innovate in bringing together the best game play and faithful scriptural content in new and fun ways.
Moving clockwise around the value proposition, our Products are the games themselves and published content (books) that provide additional learning material related to the games.
Moving into the Pain Killers section, at times, our potential customers struggle to find educational materials that are educational, faithful to Biblical truths, and fun and engaging. We believe that our games (and supporting books) will play at least a small part in meeting this need. The nature of homeschooling is very integrated and our target persona (the homeschooling mom) not only needs to educate her kids, but also keep the whole family happy. We believe that our games will be fun for the whole family, helping tie together family time with learning time in a fun way.
Finally, in the Value Creators section, while we can’t “save” the homeschooling mom’s kids, we can help those kids learn content that will help them better understand and appreciate what they read in God’s Word, while also helping them learn other basic skills (math, map reading, memorization). Even better, the kids (and parents) will have fun while learning.
The above Customer Value Map reflects the value proposition for the first game we hope to take to market (if all other steps are successful). In our discussions, some moms question whether the Biblical content we are teaching is as important as some other we could teach. Our first product also isn’t as affordable or quick to play as some moms desire given their budget and time constraints. Product-Solution Fit doesn’t require addressing all of the customers’ Pains and Gains, but we do hope to address these additional value elements in future games.
Going back to the definition of Product-Solution Fit, we have identified some of the challenges that homeschooling moms face (integrating faith/learning/fun, keeping the family happy even when busy educating the kids, etc.), and we believe that we have identified a way to help, at least to some small degree, with those challenges.
So with a level of Product-Solution Fit, we can now start to focus on what it will take to successfully launch a product to market.
Sources:
¹Osterwalder, Alexander, Yves Pigneur, Gregory Bernarda, and Alan Smith. Value Proposition Design. Hoboken, NJ: Wiley, 2014.
²Treacy, Michael, and Frederik D. Wiersema. The Discipline of Market Leaders. Reading, MA: Addison-Wesley Pub., 1995.