“Value is psychological, amorphous and complex.” — Eric Almquist.
Value is the new, new thing in product. As competition for user mindshare increases exponentially, laser-like clarity around the value your product delivers is a crucial means of differentiation. It’s also critical to effective ‘ productisation ‘ — the process of turning your technology into a successful product.
In the mind’s eye of the user, value is distinct from price. The ‘axis of value’ that exists between a company’s product and what customers pay for is delicate and complex. Done right, monetisation acts as a force for good — driving the product team to deliver more and more value. Done wrong, it becomes a malevolent tractor beam; obliging them to work against it.
A recent case in point is Evan William’s decision to pivot Medium away from ad-supported monetisation to ‘ something else’, as yet undefined. The ad-driven revenue model, he concluded, is ‘broken’ from a product perspective. Instead of monetisation being aligned with the product’s value, one works to subvert the other. Monetising eyeballs encourages content creators to publish shallow clickbait, rather than quality editorial.
Writing on media revenue modelsin The Information, Jessica Lessin observed that advertising is the reason,
“journalists chase the trivial and the easy, which doesn’t serve readers. It’s how we end up with 50 takes on the same silly article, fake news and misinformed news. It’s how we end up with bad user experiences that are tailored to advertisers, not readers.”
What tools can product leaders draw on to better articulate the value their products deliver?
A number of options exist, from Alan Klement’s ‘ Job Story‘ to Alex Osterwalder’s ‘ Value Proposition Canvas.’ Generating the most interest right now is Bain’s Eric Almquist. After extensive research, he and his team identified 30 ‘ Elements of Value‘ a product (or service) can deliver. Extending Maslow’s Hierarchy of Needs, Almquist’s team conceived a ‘ Pyramid of Value‘ that stacks elements into four layers: functional, emotional, life changing and social impact.
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