Businesses are offering a product or service that meets one of two requirements: a customer's wants or a customer's needs. An effective marketing strategy will either find a way to make a product or service that is needed, wanted, or a product or service that is wanted, needed. It is the customer's needs and wants that drive their decision making and your strategy should be built around tapping into both.
Demand is the reason why the customer needs or wants your product or service as well as their willingness and ability to pay the price asked by the business.
If you are exploring new ideas for growth in product or service lines, or are creating a strategy for existing products or service lines, here are three steps to help move you forward in the right direction:
Step 1: List why the customer needs or wants your product. Learn about your consumers and discover what problems you are solving for them.
Step 2: Next to each item listed, indicate whether the impulse to buy is a need or a want, functional or emotional.
Step 3: Make it easier for consumers to get what they need and want. Strategize ways to make a need a wanted need or a want a needed want. You can also explore ideas to make a product or service that is functional, emotional or that is emotional, functional.
To further help you define the difference:
A Need is a product or service that provides a specific benefit to the consumer. This desire to purchase could be functional or emotional. The emotional desire is what you will often see in commercials and other advertisements that relate to a consumer's lifestyle, humor, or stressor. The functional desire is required in some way to provide the consumer benefits in other ways and can easily be copied by other companies.
A Want is the consumer's desire for a product or service that is not necessary for any purpose other than the benefit of how it makes the consumer feel.
Example 1: A cup of coffee is an emotional Want. It is not necessary for any other benefit than the consumer feels a certain way during and after consumption.
Example 2: A tube of toothpaste is a functional Need. If a consumer wants to avoid bad breath, cavities, and higher dental bills, a tube of toothpaste will benefit them.
There are five steps that a consumer goes through when deciding to make a purchase of services or goods:
1. Recognizing a need
2. Searching for information
3. Seeking out and evaluating alternatives
5. After purchase evaluation
The consumer's decision making process begins with recognizing a need. This is a problem solving process where the consumer evaluates their need based upon what they already have and how important the problem really is. Once a need is identified, the consumer will compare products and services or ask friends and family for feedback and direction. Next, the consumer will seek out alternatives based upon their personal criteria. The criteria could be price, quality, location, brand, organic vs. non-organic, convenience, previous experiences, etc. During the purchase phase, the consumer will pull together the value of the product or service with their criteria and influences from branding, advertising, or other incentives such as coupons or discounts.
After the purchase has been made, how well the consumer believes the product or service performed and met their needs will determine customer loyalty. This is also the phase where a consumer will tell others about their experience. If dissonance exists after the purchase, the consumer could chase away many more potential customers.
There are rare exceptions to this process, when basing your marketing strategy solely upon what customers need and want is not in the best interest of the consumer because the value proposition changes in time. For example: In 1997, consumers were surveyed on whether or not they would use a cellular phone that had internet browsing capabilities. An overwhelming majority indicated that they would not. A good marketing plan requires discernment in what the customers says they want vs. what is the value of the product or service in the future.
April Salsbury, MBA is a strategist, an analyst, an operational guru, a recognized leader and C-suite global healthcare executive with drive and focus for competitive markets. Co-host of The Business Forum Show and regular contributor to various business journals, she possess multi-functional and multi-national competencies with more than 15 years experience in business and healthcare. Her expertise is in invigorating revenue growth and infusing value of lean practices in growing companies through improvements to cash flow and operations management.
Fueling revenue, growth and profit, Salsbury & Co. is a consultancy firm focused on helping businesses and healthcare organizations achieve excellency. Our specialists have executive experience combined with deep functional expertise to provide our clients with services that drive real impact and results.
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