Risk Versus Price Versus Value
This is the second of two episodes centered around what I call the Value Inequality. It’s a way of thinking about your customer’s perception of risk versus cost and value of your product.
This one’s a bit wider ranging than the last episode. I start out talking about some of the basics of product management: finding and validating market problems, with some ideas for how to make sure there’s a need for you to build a solution.
I segue into using the value inequality to help when selling your product. I focus on how to use the ideas in the value inequality to drive your ability to sell more and close more sales.
Then I talk about using the same ideas to pitch new product proposals to your executive team for approval and funding.
In both cases – selling, and internal pitching – a lot of the challenge is around reducing risk, both perceived and real. So, I talk quite a bit about techniques for reducing risk.
This is the audio of a Facebook Live presentations I did earlier this year.
There are a few references to things you can see on the screen (in particular a formula for the Value Inequality).
You can see the formula below.
The Value Inequality
The “formula” itself is:
V >> P + R + C + O
This reads as “The value the customer gets needs to be much greater than the cost of the product (P), plus the perceived risk (R), the change management cost (C), and the opportunity cost (O).”
I have an article on the blog about the Value Inequality: https://secretpmhandbook.com/value-inequality-real-meaning-customer-value/
Links and more information
- dbinetti.com (David Binetti’s site)
- Our podcast episodes with David Binetti (part 1, part 2)
My various Facebook Live videos: https://secretpmhandbook.com/my-facebook-live-videos/
My YouTube channel: http://www.youtube.com/c/TheSecretProductManagerHandbook
I do a live YouTube video every Monday night at 7:30pm Pacific time. Please join me live and I’ll answer your questions.
Persuasion course notification email: https://secretpmhandbook.com/persuasion.