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  • When we use the wordvalue,” we're usually trying to describe something's worth,

  • importance, or usefulness to us.

  • I value your opinion.

  • That's nice.

  • That hat seems like a great value for the price.

  • Cha-ching!

  • He had nothing of value to say and completely talked over the professor the whole time.

  • Rude.

  • And when it comes to entrepreneurship, value is everything.

  • Value is the core of any business, and it directs all future decisions, innovations,

  • and customers that get targeted.

  • Even if we've thought about the big picture, if we can't explain how an idea makes someone's

  • life better, then why should anyone pay attention?

  • So let's talk strategies to answer the two fundamental questions at the core of any business

  • model: “What value do I deliver?” andWho are my customers?”

  • I'm Anna Akana, and this is Crash Course Business: Entrepreneurship.

  • [Opening Music Plays]

  • Sometimes business jargon can seem confusing, but here's the trick: the words usually

  • have pretty literal meanings.

  • Since value means worth, a Value Proposition is the worth you offer to your customers.

  • Typically, a value proposition is a sentence or paragraph that clearly articulates what

  • your service, business, or organization does, who it brings value to, and why it's valuable

  • for those people.

  • It should be clear why someone should choose your company over the competition.

  • Value can be something tangible like offering products at a lower price or higher quality,

  • or something more abstract like better customer service.

  • For example, Slack is a messaging app designed to reduce email and streamline team communication

  • -- or, in their words, “make work life simpler, more pleasant, and more productive.”

  • Slack states the value for the customer right up front with their value proposition: Be

  • more productive at work with less effort.

  • No matter the business idea, a value proposition saves us precious time and money.

  • Without thinking about value, we risk developing something that customers don't need or want.

  • Cheetos lip balm anyone?

  • No takers?

  • You sure?

  • Alright.

  • And don't get me wrong, creating a value proposition can seem daunting.

  • We have to be confident in ourselves and the work we've done to develop our ideas.

  • Anna 1: Sowhat are you worth?

  • Anna 2: Excuse me?

  • Anna 1: What are you worth?

  • What's your value?

  • Why should people care about you and your work?

  • Anna 2: Uh, I guess...

  • I tell stories with my art that help people find meaning and feel less alonebut also,

  • how do you even judge the value of a movie or a song or YouTube video or ANY art, you

  • know???

  • When we write a value proposition, we have to think about two main things: first, the

  • experiences of our customers

  • and second, the capabilities of our product or service.

  • If we've got those down, it'll basically write itself!

  • To make sure we're covering our bases, we can use the Value Proposition Canvas created

  • by a company called Strategyzer.

  • Half of the work is understanding customers.

  • Gotta catch 'em all!

  • And to do that, there are 3 main questions to ask:

  • Number 1: What are their jobs?

  • And this is a little confusing, but I don't mean their literal jobs.

  • More likewhat do they do at work and in everyday life, and what problems do they have?

  • Number 2: What pains do they experience, like risks, obstacles, or bad outcomes?

  • And number 3: What positive gains are they looking for and receiving?

  • Everyone is trying to maximize gains and minimize pains, or at least strike a healthy balance.

  • So we entrepreneurs can try to tip the scales towards gains.

  • After considering the customer experience, we can turn the spotlight onto our potential

  • business with 3 response questions:

  • Number 1: What products and services are we offering customers to help them complete jobs?

  • Number 2: Is what we're offering a pain reliever that cuts out risks, obstacles, and

  • bad outcomes?

  • And number 3: Better yet, is what we're offering a gain creator?

  • Together, customers and products help us define our value!

  • So let's get down to the nitty-gritty details of writing a value proposition, shall we?

  • In order to figure out the jobs, pains, and gains of our customers, we have to find them

  • and get nosy about their lives.

  • But keep it professional -- this is entrepreneurship!

  • Leave your Facebook stalking skills out of it.

  • Some might call this research finding your target market, the people most likely to buy

  • from you.

  • There are lots of ways to connect with potential customers, but industry favorites include:

  • interviewing them one-on-one, holding focus groups, or conducting surveys

  • -- either in person or through an online service like SurveyMonkey.

  • Remember, the goal is to learn from potential customers to turn your idea into a top-notch

  • solution to a problem,

  • whether you're working on spill-proof takeout containers or more affordable childcare.

  • So sleuth out the Who, What, Where, When, Why, and How of your target market.

  • Who do you think or know is experiencing the problem?

  • How old are they, do they have a family, or do they speak different languages?

  • Are they a cat?

  • Please say they're a cat.

  • I understand them.

  • What are they doing when they experience the problem?

  • Are they working at a desk job, crafting something, or exercising?

  • Maybe they're hiding under a blanket away from the world and their problems until they

  • crumble into dust.

  • Where are they experiencing the problem?

  • Are they at work or at home?

  • On a plane?

  • A train?

  • An automobile?

  • When are they experiencing the problem?

  • Is there a time of day, week, or year?

  • Is it a seasonal problem?

  • Maybe it changes with the phase of moon and the flow of the tides -- we can't help it

  • when Mercury's in retrograde. Take it from a Leo.

  • Why are they experiencing the problem?

  • Why are others not experiencing the problem?

  • And, like, why me?

  • Why is it always me???

  • And, finally, how are different people experiencing the problem differently?

  • How are they learning to cope with the problem or develop their own solutions?

  • I mean, ignoring the problem is an option.

  • But, uh, not always the best way to cope.

  • Says my therapist.

  • All these questions paint a picture of who we're dealing with, and give us a peek at

  • their jobs.

  • And when we're dealing with value propositions, customer jobs can be functional, social, or

  • emotional.

  • Functional jobs are what we'd traditionally recognize as work that pays the bills.

  • A big mistake when writing a value proposition is only focusing on the functional jobs of

  • our customers.

  • But customers feel social obligations to look good or support their community.

  • And emotional jobs are all the work we put in to grow as humans.

  • The ultimate goal of understanding customer jobs is to get into their heads.

  • What they do illuminates what they value, or what they'd like to value.

  • Entrepreneurs want to change the status quo.

  • So if we know what customers value, we can figure out how to get them what they want

  • in a new or better format.

  • Remember the point of the value proposition: why should people choose you over everyone

  • else?

  • Disruption is one strategy to give customers value, and it's a hot business vocab word.

  • Instead of challenging existing markets and trying to make our idea stand out in a field

  • of others, why not create a new market (often called a blue ocean) so our idea is like a

  • seed sprouting a whole new garden?

  • Here, we're not talking about value that comes from lower prices or faster delivery

  • -- we're talking about letting customers achieve the same jobs in a totally new format.

  • Like once upon a time, radio was the cream of the crop for media in everyone's home.

  • Radio listeners had two needs: one, to be entertained, and two, to stay informed.

  • And radio met those needs by broadcasting different programs, from music to dramatic

  • theater to news.

  • Then, along came television -- a new, disruptive media format that entertained and informed

  • people.

  • Because TV achieved similar customer needs in a fresh way, TV entrepreneurs didn't

  • have to compete within the world of radio.

  • They built their own world, created new value, and maybe even found new customers who weren't

  • interested in radio at all.

  • Of course, we know jobs don't come without pains.

  • We're all human.

  • The struggle is real.

  • So when we think about our customers, we need to consider what risks or annoyances are getting

  • in their way.

  • If we can address those pains, that means we'll create a better business with more

  • value.

  • If a customer's job is applying to college, some pains could be: the clunky admissions

  • website from 2002, application fees and tuition costs,

  • a lack of family support, or the trade-off between working to earn money now and shelling

  • out money for another degree.

  • And customers wouldn't do jobs at all without gains, which tell us what they need or want

  • to experience before or after a job.

  • Sticking with that college application example, the gains might be: better career prospects,

  • a higher salary after graduation, exposure to new thoughts and ideas, a fresh start,

  • or new friends.

  • Now how are you going to help them - product

  • Now that we've researched our potential customers, we've filled out half of our

  • Value Proposition Canvas.

  • Or you can sort all that knowledge with one of those conspiracy investigation walls with

  • pushpins, multiple colors of string, and newspaper clippings.

  • You do you.

  • It's your value proposition.

  • Using all this info, we can prune our big entrepreneurial idea to make sure our products