Aspirins and Vitamins
There’s a lovely expression which I use quite a lot when assessing a new venture which is…..”is the juice worth the squeeze”. Balancing a good investment decision when considering “is this a great business versus just a good idea” or is it “a true game changer versus something that delivers marginal value” is a real art and is achieved through years of experience and many battle scars.
I meet lots of amazing entrepreneurs and discuss their entrepreneurial ventures and there are many common themes that entrepreneurs fixate on. The main one I see is all about getting traction, growth and scalability….obvs!! Aside of having great people and a great idea, I believe there is a fairly fundamental point that every entrepreneur should look at in their business and it relates to the underlying value proposition.
Every value proposition contains either a pain reliever or a pleasure gain. A product or a service can improve things, make you more productive, create greater efficiencies and so on. On the other hand, a product or service is often a solution to a problem or challenge that the customer faces. However, all too often we see a business that presents a solution to problems that don’t really exist or are not worth solving; just because you can doesn’t mean you should!
I view this as the difference between aspirins and a vitamins; one is a fix and one is a boost. It’s the difference between a product or service that delivers direct, hard savings and true customer value as opposed to indirect/soft savings and something that might make you think…..“meh….!”……I’m sure you know what I mean!!!!
When you next sit down with your team and your Head of Colouring In comes up with another wizzy, mind-blowing proposition, you need to really look at this and figure out if this is a truly compelling proposition. Entrepreneurs are by their very nature optimistic, and we get excited easily, but when did you really last look at your product or service and create your main, unique and differentiated proposition that gives you the unfair advantage over everybody else. It should be obvious and if it’s not you might want to think again.
Do we really need another app, another productivity or time saving tool, another way to listen to music, watch videos, edit documents, book tickets, etc, etc? If the value you’re giving to a customer is marginal and not obvious, then you’re probably going to struggle. There is nothing worse than desperate marketing. This is particularly relevant in the case of businesses that pivot; i.e “our first idea didn’t work so therefore we’re going to try and do something else” and this is where the danger lies and the alarm bells should be ringing. It is equally important for businesses that sell products or services that are deemed as a considered purchase; you have to have something it is truly compelling and ideally a no-brainer! So here are a few questions you might want to ask yourself and your team before you start spending your investors money and your time.
- What is different about this to everything else on the market?
- How much pain is your customer really experiencing…..ask them!!
- Why would a prospect NOT buy this?
- How big is my total addressable market and what share of that will I get?
- Have I asked 10 people if they would buy this at the price I’m selling at?
- Do people “get it” straight away?
- Have I listed benefits or features?
- Can you turn a feature into a benefit by including “..which means that…”?
- How often to people complain about the problem I am solving?
- Is my solution easy to use/deploy/learn?
- On a scale of 1-10, how compelling is this really?
- What would your grandmother say about this?
- How do people truly react when they see your product/service?
- Am I making money from this?
- Is my solution an aspirin or a vitamin?