Skip to content
Skip to main content

About this free course

Download this course

Share this free course

Business models in strategic management
Business models in strategic management

Start this free course now. Just create an account and sign in. Enrol and complete the course for a free statement of participation or digital badge if available.

4.1.1 Offer (value proposition) area

The offer, or value proposition, is embedded in the business model canvas and explains how value is created for the customer. The value proposition is shown in the value propositions block of the business model canvas. The value propositions block is also known as the value map and shows how the business model creates value for the customer. The components of the value map (or value propositions) are:

  • Products and services: these are what the organisation offers. They help customers in completing their customer jobs, satisfying their needs and creating value for customers. Products and services can range from physical assets, such as clothes, to online services such as music streaming. The value proposition typically combines more than one product or service, such as the possibility of buying a fridge online and the delivery and installation service.

    A woman taking a glass of orange juice out of a fridge filled with fruit juices and vegetables.
  • Pain relievers: these describe how products and services reduce customers pains, or problems. It is unlikely that all customers’ problems could be solved, but the most relevant could be addressed by the value proposition. For instance, the possibility of having medicines delivered at home may be a useful service for people with mobility problems. During the coronavirus pandemic in 2020, this service became an important pain reliever for customers who, being at a higher risk of fatal outcomes in case of contracting the Covid-19 virus, were advised to shield (stay home) and could not travel to pharmacies.

    A woman standing in a doorway taking a parcel from a person in a blue t-shirt.
  • Gain creators: these describe how the products and services provided can create benefits for the customers. Again, it is not possible to address all customer gains with gain creators, but the value proposition can tap into the most relevant gains. An example of a gain creator is buying train tickets with a possibility of having their e-versions sent to the buyer’s email address and a possibility of downloading them onto a smartphone. In this case, a customer gains by having easy access to a ticket via email or on the phone in case its hard copy is lost. For those travelling for business purposes, this service has an additional benefit: a speedy recording of the ticket purchase in the business’ accounting system.

    A smart phone showing a train ticket in a mobile wallet. The ticket has a QR code and the train’s departing and arrival times.

These last two components of the value map are useful for representing the value creation for the customer. Pain relievers and gain creators can be designed in order to reduce customer pains and provide customer gains, respectively. To evaluate the fit of the value proposition with customer needs, two questions should be asked:

  1. Is the value proposition providing essential customer gains?
  2. Is the value proposition reducing extreme customer pains?

Activity 7 Identifying and reflecting on the value proposition of Starling Bank

Timing: Allow about 20 minutes.

Watch Video 5 and make notes on the value proposition of Starling Bank (value map) before comparing your answer to the response given in the Discussion below. You should focus your response on the following key elements of the value map of Starling Bank:

  1. Products and services
  2. Pain relievers
  3. Gain creators.
Download this video clip.Video player: Video 5
Copy this transcript to the clipboard
Print this transcript
Show transcript|Hide transcript
Video 5 The value proposition of Starling Bank
Interactive feature not available in single page view (see it in standard view).
To use this interactive functionality a free OU account is required. Sign in or register.
Interactive feature not available in single page view (see it in standard view).


  1. Products and services

    Starling bank offers its customers a bank app and a possibility for performing all their transactions online. This application is both a pain reliever and a gain creator of the bank’s business model.

  2. Pain reliever

    The bank’s customers are typically not sure how much money they have in their current account. Therefore, in the design of its value proposition, Starling Bank has offered a solution to this problem by making it possible for the customers to use the app for full control of, and direct access to, their account. The app allows seeing the immediate balance change after each transaction; hence the availability of the information on how much money has been spent and remains in the current account. The customers can also receive notifications about their expenses immediately.

  3. Gain creator

    Customers want to save time by accessing their bank accounts from mobile devices. Starling Bank has created a simple bank account accessible from a smartphone application. The banking app proposed by Starling is designed to be accessible for all people. It also enables people to get full control of how their money is spent.

It is impossible to think about a value proposition without considering the customers it is designed for. Therefore, the next section will focus on the customer.