Most product launches still fail to meet their business targets. The good news is that digitalisation and AI make it possible for all product teams to run product innovation in an iterative test-and-learn manner. However, all the work around a new product is meaningless unless teams use solid frameworks. What you put in, is what you get out. Formulating proper insight hypotheses and value propositions is a cornerstone of successful product innovation. So, how do you get started?
Great product value propositions address large enough consumer aims and pains. When using products, consumers always have a value creation aim. In other words, consumers are after some type of value creation (pleasure-seeking, experiential, symbolic, functional, financial) so that they will be ‘better off’ in a specific socio-cultural context and situation.
Almost always, consumers feel the pain with their value creation aim. In other words, they face obstacles and therefore need help from new products that will help them get the value they are after. As late Harvard Professor Christensen smartly put it, consumers have a job-to-be-done for new value propositions: “When we buy a product, we essentially 'hire' something to get a job done.”
Consumers are resource integrators. This means they choose to use products that match their other resources so that they can create more value for themselves. The consumer resources you need to acknowledge when designing new product value propositions are knowledge and skills, physical capabilities, money, time and space available, as well as the other brands and products being used simultaneously with the new product value proposition.
When you have identified a certain consumer's aim and pain, put it all into a logical story. In other words, articulate the consumer’s aim and pain as a narrative. Here are some tips on how to do it:
As an outcome, your product development team will have a common goal: which consumer problems it is solving. As importantly, consumer respondents can evaluate if your insight hypothesis is true to them or not. This is the only way how you can make sure your product value proposition will address true and large enough consumer aims and pains.
You continue ideating and formulating alternative product value propositions that address the consumer's aim and pain. You articulate your product value proposition(s) as a narrative:
When formulating the product value proposition, try to evoke consumer imagination: what it feels like to use the product, taste the food, feel the product on the skin… We know from the academia, that the closer the value proposition is to reality, the more reliably concept testing will forecast launch performance. However, be careful with pictures. If the product pictures are very preliminary, they can mislead the consumer. Pictures tell more than a thousand words!
Let's take a concrete example in the wearables business context. This company has recognised a growth opportunity in helping consumers take better care of their wellbeing. It is aware of the growing popularity of wearables in tracking wellbeing and performance and is investigating whether it should enter the category and how. The development team has discovered needs and challenges in relation to sleep and wellbeing.
They have come up with the following insight hypothesis:
I don’t feel as energetic and fresh as I wish. I want to feel and look better. (CONSUMER AIM)
I know that my sleep isn’t good enough. I am willing to put any effort into improving it. However, I don’t want to start using a tracking device that doesn’t match my style. (CONSUMER PAIN)
By formulating an insight narrative around the consumer's aim and pain, the product development team has identified a clear job-to-be-done: “Something” that helps a consumer to improve the quality of sleep and eventually look and feel better without compromising the consumer’s style.
The team has also investigated consumer resources. They found out that consumers have limited mental energy and therefore they are not willing to put much effort into fixing the pain point of bad sleep by setting requirements for potential product value propositions. The team still has some questions, such as: Are consumers willing to wear something during the day or just something that monitors sleep only? What kind of solution would fit with their identity?
The team continued working with alternative product value propositions that address the consumer's aim and pain but from completely different angles.
This smart ring looks as elegant as any jewellery and is comfortable to wear 24/7. It measures your sleep quality and informs you in the morning how well you slept and how should you spend the coming day – should you do hard core training or have a more relaxed day.
This ring is available in several designs. You can easily order your ring online from our web shop anytime. When you order, we provide a free fitting ring first, so we can deliver you the right size.
Available in the following designs: Gold, silver, black
Sleep tracker can be easily worn on your arm or leg before going to sleep. It measures your sleep quality and informs you in the morning how well you slept and how should you spend the coming day – should you do hard core training or have a more relaxed day.
Comfortable to wear, the sleep tracker is made of soft materials that do not cause discomfort while sleeping. Equipped with a dark screen and muted sounds, the sleep tracker makes sure you sleep without disturbance.
Available in the following designs:
By formulating a proper insight hypothesis around consumers' aims and pains, and by articulating a concrete product value proposition, this company was able to test insight hypothesis and product value propositions fast and easily and learn how to iterate them. Below you can find some key learnings from the 1st testing round:
We encourage every team to put enough effort into proper insight hypothesis and value propositions as it pays off in more meaningful and beloved products, as well as happier teams and consumers!
Authors: Dr Heli Holttinen and Dr Apramey Dube
Want to learn more? Watch our webinar on How to run Modern Product Concept Testing with more detailed tips and insights.