In my Propositions Mantra a couple of weeks ago, I outlined the four fundamental principles of proposition development. I got several reader requests to discuss my approach on how I evaluate an opportunity against each of those four, plus I already promised a small deep-dive for each.
Today I focus on the first element – Relevance to customers. This is the relevance of the proposition idea or ‘opportunity’ to your customer base, to the market segment and to your company. Its core question is “What is the strong insight which makes us believe there is an opportunity to fulfil a need and monetize it?”
I usually take apart this question into two subsets:
Do you have data points from the insight to support the idea?
Search for data points to support and confirm the idea. You get those from multitude of sources ranging from direct, but consistent customer feedback to vast market segmentation and quantitative research. Working for several software start-ups, I have found that one of the best sources of ideas is customer feedback.
Small start-up example: While I worked for software start-ups, we found that the best source of proposition ideas to develop our offering has been our own customers. In one example, we had launched a new version of our software suite where the initial customer feedback was very promising. Over the next few months, some of our existing customers shared that introducing 24/7 development support for their own in-house team of software developers using our product will be highly appreciated and even expected.
Big corporation example: Let’s say your team is looking after a devices portfolio and a recent consumer market research shows a great number of consumers buying home phones would strongly prefer to have a Do Not Disturb feature on those phones, so they can avoid unwanted calls entirely while at home. Such data points come from a quantitative research, teasing out the preferences (or needs) against each consumer segment and how strongly these preferences affect your customers.
On the back of market research, proposition teams usually run a propensity to pay study to identify if these strong preferences can be monetized and whether a ‘sweet spot’ price range exists.
Is it relevant to your market and company strategy?
What turns your supporting data points from mere numbers into a true opportunity is the ability and judgement of the commercial proposition manager to connect the dots – from the findings to how those may potentially improve the product or service offering if they are implemented, and how the whole may become more desirable to customers.
Sometimes connecting the dots is obvious, sometimes it makes you leap into the unknown.
Let me try to illustrate that thought process in my two short examples:
Small start-up: “24/7 support” is nowadays a given in retail and service industries, yet in software development a 24/7 presence has been relatively novel…especially performed by other software developers rather than support officers who may not be software trained. Yet, it looks like this support opportunity can give an edge to this little company compared to more established competitors in this space. It is a relevant ask as it adds a service hug to the core software product and complements the proposition.
Big corporation: Looking to refresh your devices portfolio you search for exciting features to add to the new devices. At first glance, the evidence for a Do Not Disturb feature is really strong and such a feature will be unique addition to your product capability.
Is it relevant? Yep, 100% so.
Yet deeper analysis raises concerns. Your phones’ single purpose is to put a call through, not block it! How is your product going to be perceived if this new Do Not Disturb feature ends up blocking important calls? Is this going to be hurting sales eventually? Affecting your brand even?
Revelance is the first stage in the four step process – you cannot decide whether an opportunity is worth pursuing by looking at its relevance only.
In the next post of the series, I will move to the second attribute of any proposition – Focused, and develop those examples further. The Focused step covers what capability you need to address the market opportunity.