The Subjective Value Cycle
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A model for entrepreneurs to understand subjective value and let it
drive business development.
VALUE EXPERIENCE
Consumer Satisfaction
Brand Building
Loyalty and Repeat
More Customers
Competitive Market
Reaction
VALUE DESIGN
Sovereign Consumer
Subjective Value
Entrepreneurial Diagnosis
Value Hypothesis
Subjective Value Test
VALUE ASSEMBLY
Assemble Resources
For Value Delivery
Build Value Chain
Tentative Economic
Calculation (Cost, Price)
Beachhead Value Test
Proof of Cost and Price
Proof of Execution
Communication of Value
Consumer Trial
VALUE FACILITATION
The consumer is
sovereign – decides what
has value.
Value is subjective – a
feeling, 100% in the
consumer’s mind.
Entrepreneur uses
empathy to deduce
consumer wants and
needs.
Entrepreneur makes a
diagnosis, and then a
hypothesis of what will
bring the
consumer an
experience of value.
The hypothesis (a
concept, or an MVP) can
be tested for
validation.
VALUE
DESIGN
VALUE
ASSEMBLY
VALUE
FACILITATION
VALUE
EXPERIENCE
Consumers try the offering
and experience satisfaction
and
therefore value.
Entrepreneurs can
communicate the story
broadly and build trust in the
value proposition.
Triers repeat and become
loyal; more consumers join.
The market never stands
still – both customers and
competitors change.
The entrepreneur now
identifies and
assembles resources to
produce and
deliver the good or
service to bring value to
the consumer.
This is a unique new
specialization – no costs
or prices are given.
The entrepreneur makes
a tentative economic
calculation – an
estimated price and an
estimated cost.
If a profit seems
possible, the
entrepreneur
proceeds.
Some testing may be
possible at this stage.
The entrepreneur
takes the unique value
proposition and the
product / service to
market.
Ideally a beachhead
market value test –
the highest potential
customers.
Customers provide proof
of price;
implementation
provides proof of cost.
Execution proves the
functioning of the value
chain.
Marketing
(communicating
value) is a vital
element.
Consumer trial is proof of
value.
FURTHER
REFINEMENT
The process continues its
cycle.
The entrepreneur
practices continuous
dynamism.
Further Refinement
Key
Green = Consumer Activites
Red = Entrepreneur Activites
Yellow = Entrepreneurial Tools and Methods
START
HERE