Discovering your value

Ernst Gouws
Jun 29, 2019 · 4 min read

Imagine a world where no one specialised in anything. Where you couldn’t go to a specific store or a specific brand when you needed sports shoes. No options for running, cross-fit, football or tennis, and no difference between shoes for the young, old, male or female. Imagine needing to go on a date, but restaurants all served the same food at the same price and you had no way to match what you needed to what was available. This would be a world without value propositions.

As a customer, a world like this would be impossible to navigate. You would waste endless amounts of time and money going through the options before you *maybe* found the right fit. Luckily, we don’t live in a world like that — on the contrary — we live in a world where an over-supply of options is the norm and scarcity is the outlier. So what happens when you are on the supply side of this curve? How are you supposed to stand out, attract customers, grow, pay your bills and employ people? Among the most important things you can do is to define your value proposition.

A value proposition is the commitment you deliver to your customers about how your offer is going to generate value for them. It can be tricky business getting a value proposition absolutely right, but as with many things in life, the journey here will be as important as the destination. So let’s unpack it. Value propositions contain a number of elements that are already hidden in your business or idea.

Customers — not simply the term, but the specific customer or customer segments that think, or will think, you are the next best thing.

A product — or a service. The “what” part of what exactly you are offering customers, but a simple version of it.

Differentiation — how your product is different to others from the perspective of your customer.

“A running shoe for female athletes, with a 5mm heel raise that allows runners to run faster for longer.”

“A sustainably-produced beer from a micro brewery in Cape Town, for male and female consumers that are conscious about what they put in their bodies and the impact they leave on earth.”

“A strategy consulting service that specializes in taking Dutch tech startups to new dimensions through their EXA Model.”

It’s obvious how closely related these elements are and that they ultimately reinforce another, but there is an even stronger underlying principle behind them. Your customers, and very specific ones at that, will only buy your product or use your service if it is different and better at delivering value to them than any other option they have available today. This statement seems harsh, but it’s true, and identifying this early on in your journey will prevent you from running into this problem later on. That is why it is so important to define what your value proposition is. It’s also worth noting that the more mature your industry or market is, the more detailed you will need to be. A bicycle shop in Copenhagen, for example, will need to be much more specific about who it’s targeting with which bicycles, compared to the first micro brewer who hit the scene as the craft food trend lifted its head.

One way of constructing your value proposition is by deconstructing the 3 elements, listed earlier, through some intense questioning. If you’re still in the planning phase of a new business, you can project these questions into the future as well (rest assured, every worthwhile investor you come across will want to know this anyway). You should start with questions like:

Customers — Who am I generating value for? Are they in a specific industry? When I look at my performance, are there certain customers who outperform the rest? Are my customers in a specific part of the market, or a specific market? Do some of them share certain characteristics which would allow me to group or segment them?

Product —What exactly is it that I am selling? Is it a product, a service or a solution? Which problem am I solving for my customers? Is my product enabling them to do something else? How does it generate value for the customers I identified above?

Differentiation — Are there other offers out there that are similar to mine? If so, what makes mine different — what makes it unique? Is it designed differently? Is it more affordable? More expensive? Why? Is it based on any of the current world trends like equal rights or environmental sustainability?

As you work through these questions, your mind will automatically start forming a conceptual value proposition and as you do this, you will start realising just how permeating it is for any company. It affects who you’re selling to, what you’re selling, at what price you’re selling it, and how many times you will be able to repeat this. In turn, this will affect how much it will cost to promote your offer, what it will cost to produce it and how much profit margin there will be left after all of this.

Value propositions are difficult to get right, but there is not a single successful company that does not have one (regardless of whether they’re aware of it or not). If you want to make an impact for any purpose whatsoever, a great place to start is by figuring out your VP first.

What are your thoughts on this?

The Startup

Sign up for Top 10 Stories

By The Startup

Get smarter at building your thing. Subscribe to receive The Startup's top 10 most read stories — delivered straight into your inbox, once a week. Take a look.

By signing up, you will create a Medium account if you don’t already have one. Review our Privacy Policy for more information about our privacy practices.

Check your inbox
Medium sent you an email at to complete your subscription.

Ernst Gouws

Written by

At the intersection where tech crosses strategy. Global head of business development for a tech firm in a couple of countries.

The Startup

Get smarter at building your thing. Follow to join The Startup’s +8 million monthly readers & +788K followers.

Ernst Gouws

Written by

At the intersection where tech crosses strategy. Global head of business development for a tech firm in a couple of countries.

The Startup

Get smarter at building your thing. Follow to join The Startup’s +8 million monthly readers & +788K followers.

Medium is an open platform where 170 million readers come to find insightful and dynamic thinking. Here, expert and undiscovered voices alike dive into the heart of any topic and bring new ideas to the surface. Learn more

Follow the writers, publications, and topics that matter to you, and you’ll see them on your homepage and in your inbox. Explore

If you have a story to tell, knowledge to share, or a perspective to offer — welcome home. It’s easy and free to post your thinking on any topic. Write on Medium

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store