The Value Proposition Canvas is an innovation tool developed by Alexander Osterwalder and Yves Pigneur and published and offered by Strategyzer. This tool aims to improve the fit between a product or service and the customer (product-customer fit).
The Value Proposition Canvas itself is a worksheet consisting of two parts, Value Proposition Map and Cutomer Profile. The use of the method is described in the book “Value Proposition Design”.
This visual tool offers several exciting uses:
– Detailed understanding of customers and customer groups
– Analysis of existing products and services
– Analysis of the fit of existing products with existing customers
– innovate existing products in relation to existing customers
– innovate existing products in relation to new customer groups
– create new products in relation to existing customers
– create new products in relation to new customer groups
The basis of this tool is Osterwalder’s insight that products with a poor fit to the customer are extremely price sensitive. In contrast, products with an ideal fit are not bought on price and considerably more money can be earned with them.
The value proposition canvas is particularly useful for digital business models, as a precise understanding of the customer benefit and its translation into a suitable product is essential for survival due to the high level of competition.
