Business Modelling as a Core Competency
Benson Garner, President — Innovation Principle
• competitive strategy • 2020 Vision • WayPoint Analytics • distribution industry trends • business model
Monday, June 01, 2015—In this video, Randy sits down with Benson Garner to discuss the Value Proposition Model. The Value Proposition Model is the Business Model Canvas's most central component and it is so important that the rest of the canvas falls apart when you don't get it right.
Benson defines the Value Proposition Model as, "How you reach out to and motivate your customers to come and buy your product or service." By mastering this principle, you can ensure that your go to market strategy will be successful.
"If you don't have customers who are motivated to buy your products or services, then you're in trouble," Benson explained. "You might get away with it for a while, but eventually your luck will run out."
"Everything else in the business model is built around this interaction between you and your customer," Benson continued. "This is why it's so important to understand what's truly motivating your customers. Everybody has obstacles and pains as well as gains. It might have something to do with the job or maybe it's something more personal, like wanting to have time to spend with the family."
"I can personally relate to this idea as I once had a customer who described WayPoint's benefits in a very surprising way. Rather than talk about the value in dollars, he talked about WayPoint's value in terms of lifestyle. He mentioned being able to have dinners with the family, go on vacations, and enjoy his time. Here I had often positioned WayPoint in terms of money it could bring to the bottom line but this customer liked the way it simplified his life and gave him more free time", Randy shared.
"Most businesses only focus on the shallow level like that," Benson said. "They never bother to look at their customers' underlying motivations. This is why so many companies only speak in terms of product features instead of product benefits. If you aren't able to understand how your product actually benefits your customers, you won't know how to deliver value."
"Figuring out your customers' motivations used to be a dark art, something that we believed only a marketing team could do. However, there is a mechanical process that allows anybody to approach this topic and design value propositions that create real benefits for customers."
For more information about Benson Garner, visit: www.bensongarner.com