Key differences between POV vs. POC
Understanding POC vs. POV can be complex; many business owners, marketers, and sales professionals use them interchangeably. However, they represent two different business-related concepts and processes.
The definition of proof of concept is to prove a product's viability in the market. Does it do what it says it does? For instance, it might establish a market for a particular product and determine its functionality. Conversely, POV takes it a step further and identifies the value of a particular offering to customers and the company, helping businesses decide whether it's worth investing in the product.
Both POC and POV prove something about the business or product idea, but they prove two different things. Consider this: A business seeks an investor for capital to grow its inventory. In this case, investors might consider POV and POC as critical elements to help them decide whether or not to invest in the business.
They'll want to know that a company can demonstrate proof of value before giving them capital. POV can determine whether it's worthwhile to invest in a new product. Product development, marketing, and sales cost money; if your product doesn't provide meaningful value to the company, it's ultimately not worth it.
On the other hand, other investors may invest in startups and expect their seed capital to help the business owner provide POC. This usually occurs when the business owner has an idea but doesn't have the funds to prove it's viable. Instead, they'll use the seed money to create the product to determine whether it functions correctly.
Meanwhile, a business will determine POV to ensure there's a customer base for their new products and ensure that the product not only works but provides value. For example, a company that sells software will determine its product's viability and identify specific consumer benefits that make them stand out from the competition.
Simply put, proof of concept focuses on whether the product works, while proof of value determines how valuable it is for clients once you know it functions as it should.
For example, consider an EV company. An EV company's POC might be a car that can be charged at any EV charging port. Its POV is the benefits of the EV to customers, such as the fact the EV is cheaper than others and can help them save on maintenance costs.
Proof of value vs. proof of concept: Which one should you use?
Whether you use POC or POV depends on your overall business objectives. Companies may benefit from using both to determine if a product is viable in a specific market and, if so, what benefits there are for the customers. Ultimately, why should their clients purchase their product?
Other companies don't need both and will have to decide whether POC or POV can help them reach their business objectives. POC is best for proving a theory, such as whether a new product will work in a particular market. This usually occurs before product development to prove whether creating a product or service is feasible. POC is more qualitative than POV and can help you determine whether or not you should continue spending money on a particular offering.
Proof of value is usually for businesses that must prove the anticipated value of a product. It's quantifiable and can help you determine customer pain points and how your offering is a solution to these issues.
In most cases, deciding between POC vs. POV depends on the product and its customers. Since your goal is to close sales, you must consider not only the features and function of the product but how the product benefits those who use it.
POC and POV require success criteria to answer your questions, but they should have very different answers. For example, POC is a tool for closing sales and securing funding from an investor. Conversely, POV is less intensive and faster because it focuses on showing value instead of concept.