TREP TIP: VALUE PROPOSITIONS
This post originally appeared on Silicon Bayou News.
Welcome to Trep Tip! These are quick but informative tips that entrepreneurs (i.e. treps) can reap benefits from if implemented correctly. A great idea poorly implemented gets you nothing. A really good idea, skillfully implemented gets you everything.
Let’s jump in.
Since this is our inaugural tip, let’s start at the beginning with something any entrepreneur must do. A value proposition – it is a critical step in taking your good idea and developing it into a successful venture.
In simple terms, a value proposition is made up of three components:
A problem or opportunity that your venture is addressing
- The promise (product or service) that the venture is making, and
- The price.
- The moment you add price you go from a free promise to a value proposition. But is it the right value proposition? Does it present your product or service in a compelling way that customers will want? Like a basic algebra equation, you need to get every variable correct in order to balance the equation.
Common Mistakes and Solutions
1. The problem or opportunity is not clearly articulated.
You want to present your case in such a way that you will get agreement from the customer. The presentation needs to be clearly and succinctly shown so that the customer will agree that this is indeed a problem or an opportunity.
2. The promise fails to excite the customer and he or she doesn’t see the value.
You must structure the promise in a compelling and believable manner, so that the price is justified or even expected.