I still remember when my friend Z. first introduced me to Google. It was winter of 1999, and Z. was working on her Master’s degree in Computer Science. As I was studying there too, I often came to hang out with her and her colleagues at the Tel-Aviv University open space. One day, as we were sitting by her desk, she wanted to show me something on her computer. She opened a browser window and Google showed on the screen. As she was typing what she was looking for, Z. explained to me that “this company did something really nice” and that she really likes “this website”. She told me that she had set it as her home page because it loads so quickly, so it’s very convenient for her to use it as her starting point. I was convinced and did the same for my computer when I went back home that day.
Google is mostly known for being so much better than other search engines, “better” usually addressing the quality of the search results. This is something that has guided Google from day one, with the famous PageRank algorithm which brought real innovation into this space. In 2000, Sergey Brin interviewed for Internet Magazine and said: “when users come to Google.com all they want to do is search. And that’s our product”.
But Z. and I weren’t looking for the best search engine out there. That wasn’t what we had in mind. We were looking for the best starting point for the internet. Search was part of it, and a good search quality was needed no doubt, but the gamechanger for really using it lied elsewhere.
It is very common to confuse your product’s core functionality or your company’s truly innovative technology with your value proposition. As a product leader, your job is to make sure they are distinct and to make sure that the product delivers on its value and not just great technology.
How to Identify Your Value Proposition
There are many ways to find your value proposition and you probably need more than one to do it right. You can find detailed guidance for this in the first part of my e-book “Speed-Up the Journey to Product-Market Fit”. But if I had to pick one quick method, that is relevant for any product at any stage, it would be to ask yourself why people are using your product, over and over again.
Here is an example of what it could look like if you were the product manager of Google in the late ’90s:
Me: “Why do people use Google?”
You: “To search the web”
Me: “Why do they do that?”
You: “To get quickly to the information they are looking for”
Me: “Why is it important?”
You: “Because the internet is so huge and you don’t know where to start”
And there you have it – the starting point for finding your way on the internet. Along the way throughout this process, you also uncovered other things that are important, like speed, the usefulness of the information, and the accuracy of the results. But quick, useful, and accurate are qualities of your product. They define neither the product nor its value.
How to Use the Value Proposition
Once you have a clear understanding of what the value proposition of your product really is, you need to make sure that everyone in the company (and most importantly everyone in the company management) is aligned and understands why this is the right value proposition to work with.
It might sound as if at this point you need to tell everyone what the value proposition is and they all say ‘yes’, but that is rarely the case. Some people won’t agree with you – at least not immediately. That’s a great thing. Give these discussions some room. They will bring up great insights. It will help you refine the value proposition and make sure it is indeed the right one and will align everyone on the outcome as part of the process.
As a reminder, when I say “make sure it is the right one”, it doesn’t mean that there is an answer out there and you simply need to find it. It means that considering everything you know about the market and your target audience, it seems like the right path forward.
How to Keep the Value Proposition Intact
Now that you have a clear value proposition, it’s time to compare what you have on paper to what you have in reality.
First, conduct a quick assessment: does your current product actually deliver on the new or refined value proposition? If not, what’s missing?
Don’t skip this step even if the value proposition is very similar to what you already had in mind.
Sometimes what you had in mind didn’t manifest itself in the product, and that’s a great opportunity to identify this gap. And sometimes even one word can change everything.
For example, if your product is helping companies comply with certain regulations, your value proposition might be “never fail an audit”. That would mean that the product needs to come with a built-in comprehensive set of rules to enforce and perhaps guide the customer through the audit process. But if you realized that you best serve those who have already failed and audit and are lost in the process, your refined value proposition might be “never fail an audit again”. Just one word added. But that one word can have a lot of implications on the product and its capabilities. For example, they now know exactly where they failed and would want to make sure that you support exactly that in the process. Even if they use the product the same way, the sales process can be very different in terms of how deep they would want to test the product before the purchase. If your product doesn’t serve its entire lifecycle well, it will of course be hard for it to succeed.
Depending on the outcome of the gap analysis, you can come up with a strict plan to close all the gaps, or alternatively close them on the go. Whichever you choose, make sure at least that from now on any new addition to the product delivers on the value proposition. Have it in mind when you write requirements, and ask the explicit question in every demo and design review of every feature.
Over time, as everyone will be aligned and have their eyes set on the value proposition, the gaps will diminish. You will have the entire team as the gatekeeper of the value proposition, and not just yourself. I remember the happiness I felt when someone in QA called me once to say that something “doesn’t feel right” about a certain feature, it’s probably not what I meant. They were right, and I slept much better at night knowing that the team understands exactly what we are doing here. It felt like I have grown octopus arms that are working for me while I do other things. So, here is the bottom line: you want to sleep better at night? Crisp up your product’s value proposition, and make sure everyone understands it. Make yourself an octopus.