1.3
Fit

Fit

You achieve fit when customers get excited about your value proposition, which happens when you address important jobs, alleviate extreme pains, and create essential gains that customers care about. As we will explain throughout this book, fit is hard to find and maintain. Striving for fit is the essence of value proposition design.

Are you addressing essential customer gains?

Are you addressing extreme customer pains?

Customers expect and desire a lot from products and services, yet they also know they can’t have it all. Focus on those gains that matter most to customers and make a difference.

Customers have a lot of pains. No organization can reasonably address all of them. Focus on those headaches that matter most and are insufficiently addressed.

Your customers are the judge, jury, and executioner of your value proposition. They will be merciless if you don’t find fit!

Fit?

When we designed the value proposition for this book, we strived to address some of the most important jobs, pains, and gains that potential customers have and that are insufficiently addressed by current business book formats.

Note

Check marks signify that products and services relieve pains or create gains and directly address one of the customers’ jobs, pains, or gains. Xs show which jobs, pains, and gains the value proposition does not address.

EXERCISE
Check Your Fit

OBJECTIVE

Verify if you are addressing what matters to customers

OUTCOME

Connection between your products and services and customer jobs, pains, and gains

Do this exercise online

1
Instructions

Bring in the Value Proposition Map and Customer Segment Profile you completed earlier. Go through Pain Relievers and Gain Creators one by one, and check to see whether they fit a customer job, pain, or gain. Put a check mark on each one that does.

2
Outcome

If a pain reliever or gain creator doesn’t fit anything, it may not be creating customer value. Don’t worry if you haven’t checked all pains/gains–you can’t satisfy them all. Ask yourself, how well does your value proposition really fit your customer?

Download the Value Proposition Canvas pdf

Three Kinds of Fit

Searching for Fit is the process of designing value propositions around products and services that meet jobs, pains, and gains that customers really care about. Fit between what a company offers and what customers want is the number one requirement of a successful value proposition.

Fit happens in three stages. The first occurs when you identify relevant customer jobs, pains, and gains you believe you can address with your value proposition. The second occurs when customers positively react to your value proposition and it gets traction in the market. The start-up movement calls these problem-solution fit and product-market fit, respectively. The third occurs when you find a business model that is scalable and profitable.

Get “Fit” poster

On Paper

1. Problem-Solution Fit

Problem-solution fit takes place when you

Have evidence that customers care about certain jobs, pains, and gains.
Designed a value proposition that addresses those jobs, pains, and gains.

At this stage you don’t yet have evidence that customers actually care about your value proposition.

This is when you strive to identify the jobs, pains, and gains that are most relevant to customers and design value propositions accordingly. You prototype multiple alternative value propositions to come up with the ones that produce the best fit. The fit you achieve is not yet proven and exists mainly on paper. Your next steps are to provide evidence that customers care about your value proposition or start over with designing a new one.

In the Market

2. Product-Market Fit

Product-market fit takes place when you

Have evidence that your products and services, pain relievers, and gain creators are actually creating customer value and getting traction in the market.

During this second phase, you strive to validate or invalidate the assumptions underlying your value proposition. You will inevitably learn that many of your early ideas simply don’t create customer value (i.e., customers don’t care) and will have to design new value propositions. Finding this second type of fit is a long and iterative process; it doesn’t happen overnight.

In the Bank

3. Business Model Fit

Business model fit takes place when you

Have evidence that your value proposition can be embedded in a profitable and scalable business model.

A great value proposition without a great business model may mean suboptimal financial success or even lead to failure. No value proposition–however great–can survive without a sound business model.

The search for business model fit entails a laborious back and forth between designing a value proposition that creates value for customers and a business model that creates value for your organization. You don’t have business model fit until you can generate more revenues with your value proposition than you incur costs to create and deliver it (or “them" in the case of platform models with more than one interdependent value propositions).

Customer Profiles in B2B

Value propositions in business-to-business (B2B) transactions typically involve several stakeholders in the search, evaluation, purchase, and use of a product or service. Each one has a different profile with different jobs, pains, and gains. Stakeholders can tilt the purchasing decision in one direction or another. Identify the most important ones and sketch out a Value Proposition Canvas for each one of them.

Profiles vary according to the sector and size of organization, but they typically include the following roles:

Adapted from Steve Blank, The Four Steps to the Epiphany, 2006.

Aggregated

Value Proposition

Business Segment

+Unbundled

Value propositions to stakeholders within the business

Organizations are customers that are composed of different stakeholders who all have different jobs, pains, and gains. Consider making a Value Proposition Canvas for each one.

Influencers

Individuals or groups whose opinions might count and whom the decision maker might listen to, even in an informal way.

Recommenders

The people carrying out the search and evaluation process and who make a formal recommendation for or against a purchase.

Economic Buyers

The individual or group who controls the budget and who makes the actual purchase. Their concerns are typically about financial performance and budgetary efficiency.

In some cases, the economic buyer may sit outside an organization, such as a government paying for the basic medical supply in nursing homes for elderly citizens.

Decision Makers

The person or group ultimately responsible for the choice of a product/service and for ordering the purchase decision. Decision makers usually have ultimate authority over the budget.

End Users

The ultimate beneficiaries of a product or service. For a business customer, end users can either be within their own organization (a manufacturer buying software for its designers), or they can be external customers (a device manufacturer buying chips for the smartphones it sells to consumers). End users may be passive or active, depending on how much say they have in the decision and purchase process.

Saboteurs

The people and groups who can obstruct or derail the process of searching, evaluating, and purchasing a product or a service.

Decision makers typically sit inside the customer’s organization, whereas Influencers, recommenders, economic buyers, end users, and saboteurs can sit inside or outside the organization.

Unbundling the Family

Value propositions to the consumer may also involve several stakeholders in the search, evaluation, purchase, and use of a product or service. For example, consider a family that intends to buy a game console. In this situation, there is also a difference between the economic buyer, the influencer, the decision maker, the users, and the saboteurs. It therefore makes sense to sketch out a different Value Proposition Canvas for each stakeholder.

Multiple Fits

Some business models work only with a combination of several value propositions and customer segments. In these situations, you require fit between each value proposition and its respective customer segment for the business model to work.

Two common illustrations of multiple fits are intermediary and platform business models.

Intermediary

When a business sells a product or service through an intermediary, it effectively needs to cater to two customers: the end customer and the intermediary itself. Without a clear value proposition to the intermediary, the offer might not reach the end customer at all, or at least not with the same impact.

Chinese firm Haier sells home appliances and electronics to households globally. It does this largely through retailers such as Carrefour, Walmart, and others. To be successful, Haier needs to craft an appealing value proposition both to households (the end customer) and to intermediary distributors.

Haier has a value proposition to the end customer, households. Haier has a value proposition to their intermediary customer, the retailers, who are also the main channel for the end customer.

Platforms

Platforms function only when two or more actors interact and draw value within the same interdependent business model. Platforms are called double-sided when there are two such actors and multisided when there are more than two. A platform exists only when all sides are present in the model.

Airbnb is an example of a double-sided platform. It is a website that connects local residents with extra space to rent out and travelers looking for alternatives to hotels as a place to stay. In such a case, the business model needs to hold two value propositions, one for local residents (called hosts) and one for travelers.

Going to the Movies

Let us walk through the concepts of the Value Proposition Canvas with another simple example. Imagine the owner of a movie theater chain wants to design new value propositions for his customers.

What drives the moviegoer?

What should the new value proposition look like?

He could start with the value proposition’s features and get excited about the latest generation of big screens, state-of-the-art display technologies, tasty snacks, social happenings, urban experiences, and so on. But, of course, those only really matter if customers care about them. So he sets out to better understand what his customers truly want.

Traditionally he’d sketch out psychodemographic profiles of his customer segments. But this time he decides to complement this type of segmentation with customer profiles that highlight a customer’s jobs, pains, and gains.

Tip: A (potential) customer exists independently of your value proposition.

When you sketch out your customer’s profile, don’t just focus on jobs, pains, and gains related to your value proposition. Keep it broad to understand what really drives your customers.

A Movie Theater’s Business Model

The new approach: focusing on the jobs, pains, and gains that drive customers

By sketching out a customer profile, you aim to uncover what really drives people, rather than just describing their socioeconomic characteristics.

You investigate what they’re trying to achieve, their underlying motives, their objectives, and what’s holding them back. Doing so will broaden your horizon and likely uncover new or better opportunities to satisfy customers.

The traditional approach: psychodemographic profiles

Traditional psychodemographic profiles group consumers into categories that have the same socioeconomic characteristics.

JANE MOVIEGOER

20-30 years old

Upper middle class

Earns $100K/year

Married, 2 children

Movie Behavior:

Prefers action movies
Likes popcorn and soda
Does not like waiting in line
Buys tickets online
Goes once a month

Same Customer, Different Contexts

Priorities change depending on a customer’s context. Taking this context into account before you think of a value proposition for that customer is crucial.

With the jobs-to-be-done approach, you uncover the motivations of different customer segments. Yet, depending on the context, some jobs will become more important or matter less than others.

In fact, the context in which a person finds himself or herself often changes the nature of the jobs that the person aims to accomplish.

For example, the clientele of a restaurant is likely to use very different criteria to evaluate their dining experience at lunch versus at dinner. Likewise a mobile phone user will have different job requirements when using the phone in a car, in a meeting, or at home. Hence, the features of your value proposition will be different depending on which context(s) you are focusing.

In our example, the context in which our moviegoer finds herself will influence which jobs matter more or less to her.

Add contextual elements to your customer profiles if necessary. They might serve as constraints for designing value propositions later on.

The kids’ afternoon off

When? Wednesday afternoon

Where? Leaving from home

With whom? Kids and maybe their friends

Constraints? After school, before dinner time

Date night

When? Saturday evening

Where? Leaving from home

With whom? Partner

Constraints? Kids taken care of (if parents)

Personal research

When? Any time

Where? Leaving from home

With whom? Alone

Constraints? Needs to be able to take notes

Same Customer, Different Solutions

In today’s hypercompetitive world, customers are surrounded by an ocean of tempting value propositions that all compete for the same limited slots of attention.

Very different value propositions may address similar jobs, pains, and gains. For example, our movie theater chain competes for customer attention not only with other movie theaters but also with a broad range of alternative options: renting a movie at home, going out to dinner, visiting a spa, or maybe even attending an online virtual art exhibit with 3D glasses.

Strive to understand what your customers really care about. Investigate their jobs, pains, and gains beyond what your own value proposition directly addresses in order to imagine totally new or substantially improved ones.

Understand your customers beyond your solution. Unearth the jobs, pains, and gains that matter to them in order to understand how to improve your value proposition or invent new ones.

Lessons Learned

Customer Profile

Use the customer profile to visualize what matters to customers. Specify their jobs, pains, and gains. Communicate the profile across your organization as a one-page actionable document that creates a shared customer understanding. Apply it as a “scoreboard” to track if assumed customer jobs, pains, and gains exist when you talk to real customers.

Value Map

Use the value map to make explicit how you believe your products and services will ease pains and create gains. Communicate the map across your organization as a one-page document that creates a shared understanding of how you intend to create value. Apply it as a “scoreboard” to track if your products actually ease pains and gains when you test them with customers.

Fit

Problem-solution fit: Evidence that customers care about the jobs, pains, and gains you intend to address with your value proposition. Product-market fit: Evidence that customers want your value proposition. Business model fit: Evidence that the business model for your value proposition is scalable and profitable.

Download the Value Proposition Canvas pdf

Design, Test, Repeat

The search for value propositions that meet customer jobs, pains, and gains is a continuous back and forth between designing prototypes and testing them. The process is iterative rather than sequential. The goal of Value Proposition Design is to test ideas as quickly as possible in order to learn, create better designs, and test again.