Make your business more profitable by focussing on value(VPC)

value proposition canvas ( The adjacent link is the pdf of vpc.)

We had earlier seen the Business Model canvas and its nine building blocks. 

out of which the value proposition and customer segments( centre and extreme right block) can be given in detail by using the business tool called value proposition canvas as shown in the first image.

We will go into details all the components.

The square represents the value propositions and the circle represents the customer segments.

Value propositions has three main components 

 1.the products and services,

2. the gain creaters, 

3. the pain relievers.

 so for example suppose we have a mechanical and service centre for passenger vehichles.( A garage.)

 Now in products they could be offering consumables like coolants, engine oils, car accessories , and so on. In services they could be general service, cleaning, washing, rust proofing, painting, mechanical repair and so on. 

some of them act like gain creators. i.e they improve the finish of the car, they add music systems which makes the car drive more enjoyable, replacing worn out tyres makes the car ride smoother and others.

the other is pain relievers. For example regularly servicing the car, prevents or reduces unexpected breakdowns which is really a harrowing experience whenever it happens, and specially in remote locations. The other pain reliever is Changing some of the engine and moving parts after regular intervals ( preventive maintenance) which reduces the instance of the car giving trouble as  well as ensuring  safe drive. 

In the right side of the diagram we have a circle, where we have jobs that customers seeks from us, or need to be done. The gains they perceive , and the pains they forsee which they wish to avoid from out products and services. Together they form the value which they perceive to get/seek from acquiring our products and services by paying a certain price.

Taking the same example as above for a garage providing comprehensive service as well as car accessories we could have the following. 

 The customer would like to improve the fuel efficiency of the car, to reduce fuel bill. running cost. This could be one of the job, for which he may opt of enging tunning service to achieve that. Here it is important to understand that the job is reducing fuel cost , and by undertaking engine tunning is only the method to achieve that.

 The other job is to improve the look of his car, because he wants to keep a good image of himself, which he would not like it to be spoilt by having a old and dented car. So the customer may go removing dents, body paint , adding new door handles, putting film on windows and others.

 The other jobs could increasing the comfort while driving the car, which is achieved by efficient air conditioning. some of them may also seek easy manouverability which is achieved by power steering and disc brakes and so on. So customer jobs are to be identified by knowing the actual needs which could be  both visible, easily identifiable physical needs  or  invisible esteem needs.

the gains and pains which each customer segment has is written seperately. It is also mapped with the gain creator and pain reliever provided by the company, and is it of adequate level.

 For example a customer who is a  personal private user of a car, and a customer who is using is a business user of car, to earn fixed monthly rents on his mobile asset, and a customer who is a self employed driver using the vehicle to earn daily fares, will view the regular servicing of the car differently. 

The level and need of the service required will be different for all 3 customer segments. To be able to serve all 3 types of segments you need to offer customized solutions to them, otherwise they may feel dissatisfied with a generic offering and lead to loss of business in future.

 This tool enables you to think in these terms so that your value proposition beomes strong for all customer types, and hence be able to fetch a better price which leads to a sustainable profitable business.

 If you need to narrow down the customer segments which you wish to serve, because of limited resources at your disposal, then you  will be able to make a better choice by better understanding of the customer segments and their percieved value, and select those which are in alignment with our strengths and expertise.

I am using the specialized tools provided by the strategic consultancy organization called strategyzer, of which one of the tool VPC is as shown above. I would be pleased to offer consultancy based on my own personal knowledge, experience, and study done on the use of these tools to your organization.

 This I believe would be  significantly beneficial to your organization by bringing lot of clarity in many things and set future path. To understand that I am offering free 30 minutes discussion, to understand the issues. 

Please take benefit of it by imediately booking the slot from the following link. www.calendly.com/rmadhiwalla  . Alerantively you may email me at connect@rahulmadhiwalla.website.