While there are a great number of new products every year, history shows that less than 30% of new products and services actually generate enough sales to stay afloat. So, the question of how to design a new product or service has been one of the most puzzling questions.
To untangle this question, and try to provide insight into how to understand what customers really want, let's consider a systematic approach to understanding customer needs.
Using a systematic approach will get you out of the trap of thinking that customers don't know what they want. You will also more likely come up with a product that customers really want or need. But there is one more important benefit.
By using a systematic approach, you are more likely to generate more ideas, more effective ideas, and increase the chance for success.
TYPES OF CUSTOMER NEEDS
To find new product ideas you have to start by thinking about the different types of customer needs. For example, we can think of at least four different types of needs:
- Current Needs – or the needs already recognized by customers.
- Potential Needs – the needs other than current needs, but not recognized by customers yet.
- Problem Needs – the needs related to recognized problems (these are typically the ones that improve existing products)
- Potential Problem Needs – or how to add value to current product or usage
WHERE DO CUSTOMER NEEDS COME FROM?
All the different types of needs arise at various points along a “consumption chain”.
For example, a customer may find it inconvenient to shop around for a product, and they may also experience problems when they try to dispose of a product. Therefore we need to understand where, in terms of time, the need is coming from. For example, needs can arise:
- Before Purchase
- During Purchase
- During Use
- During Disposal
- During Repurchase
THE WHO, WHAT, WHY OF CUSTOMER NEEDS
You can also understand customer needs by thinking about how a journalist might question someone about a story. They'd ask the following 5 questions to really understand what's going on.
- Why – why did a customer buy a product?
- When – when did they buy it?
- Where – where did they buy it?
- How – how did they buy it (what steps did they go through)?
- Who – who bought it?
A BETTER WAY TO THINK ABOUT DISCOVERING CUSTOMER NEEDS
C. Whan Park is the Robert E. Brooker Professor of Marketing at USC's Marshall School of Business. He is co-author of a recent book on brand admiration, which blends years of best-practice thinking from academia with the real-world practice of marketing. He is internationally recognized as one of the most frequently cited researchers in the area of consumer behavior.