VALUE PROPOSITION TESTING FOR MAD FOR MAKEUP

• Main Author: Aulia Rahmasari, Fildza
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/83936
• Institution: Institut Teknologi Bandung

Regardless of gender, cosmetic items are now an essential part of everyone's everyday life. The cosmetics business is predicted to experience significant growth in the upcoming years due to the broad integration of cosmetic products into the everyday routines of modern individuals. The worldwide beauty market is predicted by McKinsey and Company to expand at a rate of 6% annually and reach an estimated value of about USD 580 billion by 2027. Indonesia's market is in a similar state with regard to the cosmetics business. The industry has grown significantly, with a compound annual growth rate (CAGR) of 7.5 percent between 2021 and 2027. Given the enormous potential for growth in the Indonesian cosmetics sector and the increasing level of competition in the domestic cosmetics market, the local cosmetic brand Mad For Makeup wants to enhance its business performance in order to fulfil its goals, stay competitive, and establish a connection with its target market. Because of this, the business must enhance and validate its value proposition to guarantee that the values it offers are in line with what its customers actually want. The process of testing Mad For Makeup’s value proposition used the Three Types of Fits Framework by Osterwalder, which consists of Problem-Solution Fit, Product-Market Fit, and Business Model Fit. But, due to time and resources constraints, the author only validated the Problem-Solution Fit and Product-Market Fit. To achieve this, a mixed method (quantitative and qualitative) was employed. Firstly, the qualitative method through in-depth interviews with customers provided the authors with rich insights regarding the initial Value Proposition Canvas. The jobs, pains, and gains in the initial Value Proposition Canvas have not been validated yet, therefore, in the Problem-Solution Fit test stage, Customer Assumption Test through quantitative 4-point Likert scale survey was conducted to identify the most relevant customer assumptions. After the customer assumptions were validated, an updated Value Proposition Canvas could be developed, which eliminated the least relevant assumptions. Two Value Proposition Hypotheses were extracted from the most relevant customer assumptions, namely “Maintaining-skincare” and “Effective-for-the-price cosmetics” value propositions. In the Product-Market Fit test stage, these hypotheses are validated through interest, preference, and willingness to pay validation. The validation test results show that Value Proposition 1, “Maintaining skincare”, is the most compelling value proposition. The delivery of the most compelling value proposition consisted of optimizing channels and building customer relationships.