I found quite recently that about 60 percent of apps on the Play stores never get downloaded, and even when they do, they are mostly used once, uninstalled, and never installed again by the same user. What does this mean? The developer has created a solution but the question is, was there a problem with this solution he has created? Has he done it better than everyone else? Has he in any way made life easier, better, cheaper, faster, and more convenient for his target market?
Your value proposition identifies the exact problem you are solving and how. There might be a solution for every problem, but not a problem for every solution. Every product or service you see out there is a solution, but the issue is that some people are creating solutions for problems that do not yet exist or problems that people do not even know they have. What you want to do as an entrepreneur is to ensure that there is a problem you are solving.
The neo-banks or digital banks entered the banking scape in the last couple of years, and at first, it seemed like they had only come to be a digital version of the banks as we know it. But in a short while, they showed their value proposition – zero bank charges, do all your banking transactions from the comfort of your phone, never have to queue in the banking halls, better interest rates on savings, and so on. Steadily, they have been cornering some market share from what one would have described as an already-saturated banking sector. What is the reason for this? They had a solid value proposition.
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Your value proposition says what you are offering to do, for whom, and why it is better than the competition. Why would a person download an app, use it once, and then discard it? The value proposition was weak or probably non-existent.
Maybe the app was solving the same problem as several other apps, and not doing anything better.
Maybe the app had so many bugs, lags, and frequent ads that affected user experience.
Maybe the app offered very little for free before asking the user to upgrade to a paid version to access more. No one wants to pay for something that has not given them considerable value.
When building your value proposition, always think of who is willing to pay for what you are offering? There are several things (products, services, and solutions) that people would love to have, but are not willing to pay for. However, there are others that people (the target audience) need desperately and are ready to pay for.
That is the difference between a nice-to-have and a need-to-have solution. Let’s look at Zido for instance. Zido Logistics is reducing and removing frictions and expensive middlemen from Africa’s logistics system. This was an already existing problem that we came into the scene to solve. Zido did not come up with a solution and then start looking for people with the problem.
Businesses already had this problem to contend with, and it was costing them money and also slowing down their processes. By bringing a value proposition that automates the processes, reduces time wastage, and increases efficiency for cargo owners and transporters, breaking into the market became inevitable.
That is what a value proposition should be. Think about your customers and how you can satisfy them.