Customer Needs: The Complete Guide for Marketers

To understand consumer behavior, you must understand customer needs. Needs establish goals which in turn determine what products and services consumers purchase.

Whether it’s choosing what to eat for lunch, which beverage to drink, what evening activity to do, or which mobile app to open on a commute, each decision is driven by a specific contextual goal influenced by an underlying customer need.

Successfully identifying and addressing the right needs better than the competition will lead to increased market share and stronger financial performance. Not only will it make your marketing communications more relevant, but also allow you to develop the right products and charge higher prices.

To put it short, customer needs are the bases on which you build a business.

In this guide, I aim to give you a comprehensive overview of customer needs: what they are, why they are important, different types, how to identify customer needs, and ultimately meet them.

No matter whether you are a marketer working on an established product, or an entrepreneur launching a new product, service or business; this guide will provide you with knowledge to better meet your customers’ demands.

What are customer needs?

It’s not uncommon that highly innovative products flop in the market. Usually, these are produced by highly proficient people and marketed using technical language. But they fail to address prominent customer needs.

In the most basic sense, a customer need is a problem that a consumer wants to solve. Solving the problem often requires finding a suitable product or service to do so. Put differently, customer needs are a context which prompts users to set goals and motivates them to attain them.

However, if you want better insights into why people buy what they buy (and you should want that), we need to dig a little deeper.

Customer needs work closely with goals and motivation. The process goes something like this:

“I’m hungry“: Need
“I don’t want to be hungry / I want to feel full”: Motivation
“I’m not hungry / I’m full”: Goal

We can take another example with another need that’s higher in the hierarchy.

“I’m bored”: Need
“I don’t want to be bored / I want entertainment”: Motivation
“I’m not bored / I’m entertained”: Goal

You can think of this like a journey from a current situation towards a desired situation. Your performance as a brand depends on how easy you can make this journey for your customers. That’s more easily said than done though. You need to do loads of research to really understand your customers and the context. But don’t worry, I will cover that.

Understanding the context is important because needs are abstract context-dependent statements describing the desired benefits in customers’ own words. You can then design product features to meet these needs. But, yet again, it’s not rarely this clear cut.

Known and unknown needs

People are great at telling us what they want, when what they want is something functional. In the paragraph above, “customers’ own words” are likely to be very utilitarian. For example, needing a jacket to stay warm, or boots that don’t hurt their feet. But people are much less likely to tell you that they also want the jacket because it increases their self-esteem, or that the boots make them feel taller and less insecure.

Consumers aren’t eager to share these needs with brands. A large part of the reason for that is that often they are unknown to them. Needs, and their accompanying goals, can operate beneath consciousness. This is true in particular for needs related to our self-identities.

As a result, we can’t just simply ask customers what their subconscious needs are. We need to use research and insights from neuroscience and psychology instead and make generalizations.

Known functional needs and unknown emotional needs usually operate in tandem. Effectively meeting both will establish a strong brand position.

implicit and explicit goals for ABS systems of different car manufacturers. — The known (explicit) and unknown (implicit) goals signalling of car manufacturers. Borrowed from Decoded, by Phil Barden (2013) p. 198.¹

Promotion and prevention needs

Customer needs are fundamentally motivated by two key drivers: promotion and prevention. Fundamentally, it’s a question about whether people’s needs are founded in gaining something, or not losing something.

This is tricky. One category can reflect both promotion and prevention. Consider why people go to the gym. It can be to improve health, but also to not lose health. You can apply the same logic to healthy eating habits; to become healthy or to stay healthy.

Understanding who is promotion oriented and who is prevention oriented is hard because it can change with each context. Do your own research and try to empathize with your customers. Are they driven by aspirations or loss aversion? Knowing the answers (or at least portions of them) to these questions will enable you meet your customers’ needs much more effectively.

Why are customer needs important?

You must understand needs to do effective marketing. Segmentation, positioning, and messaging are all based around specific customer needs identified with market research. So, uncovering and understanding the needs relevant to your business is critical.

You’d be surprised how many brands fail to do so, or use the wrong needs for their products and services. Often you even see businesses broadcast solely product features without any indication of what need those features should solve.

There’s a famous quote from Harvard professor Theodore Levitt on this subject. It says: “People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!” It’s so widely quoted that it’s almost a cliché, but the message is clear as ever. No one cares about your features, they just want to fulfill their needs.

“People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!“
Theodore Levitt

A useful way to think about this is in terms of jobs to be done.

Jobs to be done is a framework for thinking about the underlying needs that motivate a purchase. It was coined by another Harvard professor, Clayton Christensen, along with Scott Cook and Taddy Hall.²

Christensen argues that consumers don’t buy a product per say, but rather hire it to get a specific job done. The job refers to a goal consumers are trying to satisfy. In other words, the job is to bridge the gap between a customer need and a goal. If you manage to do this, consumers will see value in your product.

Thinking about needs in terms of the job (or goal) consumers are trying to accomplish opens up a brand new perspective on the market. That’s because you are stepping out of the purely utilitarian product category way of seeing thinks by also considering social and emotional functions your product may cater to. This generally has a much larger addressable market.

Needs drive attention

Active needs drive consumer behavior. A key reason for that is because needs have priming effects.

Priming effects occur when people are exposed to something that influences their consequent behavior. In this sense, the exposure doesn’t have to be some external tangible thing, but can be something like a thought or a feeling as well.

Imagine you are walking in the street on a hot summer day. There are countless messages around you but you only notice a fraction of them. Say you feel thirsty and want something refreshing, odds are your attention would be drawn to lemonade stands, bubble tea shops or ice cream stands. Flip it over to a cold winter day and these things are unlikely to catch your attention as effectively. That’s because even subconsciously your attention is primed towards satisfying your goal.

According to Gordon Moskowitz,³ a social psychologist, our brains allocate more attention to stimuli that are relevant to our goals and needs. Even if those needs are unknown to us at the time. Hence, it’s an automatic process that Moskowitz has aptly named preconscious processing.

Rik Pieters and Michel Wedel⁴ studied more conscious processing and applied it in an advertising context. They used an eye-tracking experiment, allowing them to capture precise measures of attention in real-time, and provide much more objective evidence.

220 consumers were recruited and randomly assigned one of five conditions:

Free-viewing (control group)
Ad memorization
Ad appreciation
Brand learning
Brand evaluation

Based on their conditions, participants were given a brief instructional text. For example, the ad memorization group was asked to try to memorize the advertisements whereas the ad appreciation group was asked to determine how attractive (or unattractive) they found the ads they were presented with. Other groups were asked to try to learn about the brand’s products and determine how good (or bad) they are.

Participants then went on to look at 17 print ads served in randomized order. Each had a picture, headline and some body text. Pieters and Wedel used fixation, gaze duration and pupillary diameter to estimate attention levels — though admittedly in the end, only gaze duration lead to applicable insights.

The different types of customer needs

You’ve probably begun to understand now that needs are complicated, but critical for marketers and businesses to understand. There are many different types unique to individual situations. We can however make some generalizations to make our work a little bit easier.

Just like we have already categorized needs broadly as unconscious vs conscious, and prevention vs promotion oriented, we can categorize needs based on the type of goal they aim to accomplish. The most basic categorization you are probably familiar with is the utilitarian/functional vs hedonic. If you Google “customer needs” you will even find articles with up to 19 needs, though I’d say a lot of these items aren’t needs but more like product features. At the very least, many of them are not needs you can apply in a broad marketing context.

I like to keep it simple stick to fundamental needs that are prominent in everyday life. These are functional needs, emotional needs, and social needs. Within these categories, you can then go ahead and define the needs most relevant to your business. Keep in mind that these categories are not a singular holy truth but a useful framework. Needs can overlap with two or even all the categories. In that case, it’s a worthwhile exercise to try to understand the degree of influence of each type of customer needs.

If you can identify what goals drive customers to your products, and to what degree they are shaped by functional, emotional and social needs, you most likely have a solid understanding of your target audience and can therefore serve them better.

Functional needs

Functional needs are the most apparent of the three. They are all about utility.

Products and services that satisfy functional needs help people accomplish readily observable and simple tasks. For example, getting from point A to B, cleaning your teeth, or keeping you warm on a cold winter’s day.

Functional needs are typically the easiest to observe, but they are often paired with deeper emotional and social needs. They are a precondition of sorts.

Imagine you’re buying a winter jacket. The functional requirements are likely that it is warm, durable, waterproof, et cetera. Once you’ve found a jacket that fulfill these needs, you are likely to consider other aspects such as how it will make you feel (emotional needs) and what you expect others will think of you if you make the purchase (social needs).

Emotional needs

Emotional needs usually follow functional needs — as already mentioned earlier. They are all about how we feel and our self-image.

Emotional needs are a major driver of consumer behavior. They can help you understand why customers do things (and why they don’t). However, they can be hard to uncover given that sometimes people don’t realize themselves that they’re being driven forward by emotional needs. Likewise, people may be aware of the need but not the level of its impact.

Going back to the winter jacket example; I mentioned that consumers are likely to consider other aspects than pure utility. For example, people will likely think about how they look in the jacket and how that makes them feel. A person may think they look good and feel like their self-esteemed has just been boosted. In this case, the jacket is not only meeting a practical need but also a universal need for confidence and self-assurance.

Other emotional needs may be based around gaining (or avoiding) happiness, nostalgia, agitation, fear, hope, sadness, or pride, to name a few examples.

Social needs

The last category includes social needs. These are all about how we want other people to think about us.

Like emotional needs, social needs are more covert than functional needs but are nevertheless an influential driver of behavior, and more specifically, consumption.

Evolutionary psychologists argue that people have a fundamental need for belonging and affiliation. As a result, we seek out products than enable us to connect with others and seek people’s opinions about our decisions, including purchases.⁵ For example, you may pick a winter jacket based on what society deems fashionable at the time, or buying a computer that’s considered industry standard.

People also have an innate need for status. They want respect, prestige, and to stand out from their peers and will orient their consumption to fit those goals. For example, people may buy fancy cars and luxury cars for these reasons, or engage in something radically distinct from their peers in order to better express a unique identity.

Don’t forget that customer needs categories are not mutually exclusive, and status is a great example of that. For example, if a luxury watch enhances self-esteem, then it’s no different from the winter jacket. Likewise, the need to look good is likely derived from social standards, forming a significant element of social needs. Ultimately, it will depend on each situation and the countless variables that shape it.

How to understand customer needs

So far you have learned that customer needs are problems. Since people don’t want problems, they are motivated to make them go away. In other words, their goal is to eliminate the problem. This entire process can happen consciously or unbeknownst to consumers and each need is shaped by an orientation to prevention or promotion.

Understanding customer needs is easier said than done, but it is nevertheless essential if you want to design and deliver products that solve real problems. You will need to do extensive research and analyze your customers in-depth to correctly uncover their needs that relate to your business.

How to identify customer needs?

You have learned from this article that customer needs are:

Context specific
A precondition for attention
Conscious and subconscious
Prevention and promotion focused
Functional, emotional and social.

Knowing what you know now already makes identifying customer needs more attainable than were you starting from scratch. Now you know much better what to probe for and what factors you must consider to fully understand a need.

Below are several methods you can use to fully identify and understand your customers’ needs. I have ordered them in descending order starting with the easiest to conduct. Just keep in mind that easiest does not equal best and direct customer input always trumps secondary data and your own experiences. The more methods you use to inform your understanding, the better.

#1 Use your expertise

If you have significant experience in the field of your venture (or experience you can apply to your situation) you may start by reflecting on that. Many startups are born because people grow frustrated of issues they faced in previous jobs. But I warn you to not rely solely on this. It’s nevertheless not bad starting point.

#2 Conduct secondary research

By examining market reports, industry publications, academic research, customer surveys, and competitor analyses, you can gain insights into broader trends, preferences, and pain points of your target audience. Here is a long list of sources to get you started.

Keep in mind, however, that you are unlikely to get rich enough information out of secondary research alone. Likewise consider how to conduct secondary market research for your situation. It’s still a systematic process that requires you to be very critical of the sources you come across.

Secondary data is helpful, but make sure to supplement it with primary research and validate your findings to ensure relevance to your context.

#3 Observe behavior

Go out and look at people you believe could be your customers. Observe what they do in the context of your product and service and note it down. Given that your audience is easily observable, this may be among the richest data you can access. It’s well established that people don’t always say the same things as they do. Observations are an opportunity to avoid such biases in your analysis.

Clayton Christensen⁶ used observations when working for a fast-food restaurant that wanted to increase milk shake sales. He noticed that 40% of milk shake buyers were in a hurry early in the morning and took the shakes directly to their cars. Upon further investigation using other methods he found out that people bought shakes to make their commute more interesting and keep hunger at bay until lunch with something they could easily consume while driving. Knowing this, implementing the appropriate product adjustment was easy.

#4 Analyze customer feedback

If you collect customer feedback, a low hanging fruit would be to analyze it thoroughly. People often reveal a thing or two about their needs when they feel your product came short in fulfilling it.

Pay close attention to feedback, in particular the negative. You may find these through channels such as customer support, online reviews social media comments and feedback forms. Look for recurring themes and patterns that highlight needs and pain points.

#5 Use social listening

Social listening has become increasingly popular in recent years with tools like Brand24 and BrandMentions offering businesses to monitor online chatter in an affordable and simple manner. You can use these tools to gauge what consumers are saying about you online. More important, you can also listen in on what they have to say about pain points, problems and goals related to your products.

If you have the resources, I recommend that you observe the conversations happening around your area of expertise. It can provide valuable insights into their frustrations and unmet needs.

#6 Survey your customers

Surveys are great to collect quantifiable data at scale. If you run an e-commerce business, using surveys is ideal. You can ask your customers to fill in surveys post-purchase, on your website, social media, newsletter or any other owned media. If you have a physical location, don’t be shy to ask people to fill in a short form there.

Surveys are limited, however. It’s expensive to collect data from non-customers and, even then, replies will not be as rich as through face-to-face conversation.

#7 Conduct in-depth interviews

Last but not least you can conduct in-depth interviews to identify customer needs. Interviews allow you to get more specific than any other method and can uncover important personal insights regarding people in your audience. It’s essential to be sensitive towards the interviewee and enter the interview with genuine curiosity. Otherwise, you risk biasing the data you gather.

Here are a few do’s and don’ts to consider:

Do:

Create a comfortable and safe space for the interviewee.
Use open-ended questions.
Ask follow-up questions to probe deeper.
Actively listen.
Ask participants to provide specific examples in order to shed light on their needs in practical contexts.

Don’t:

Ask leading questions.
Make assumptions about your customers’ needs.
Overload the interviewee with questions.
Interrupt the interviewee.
Impose your own opinions.

Conclusion

Putting it all together, we have discussed the multifaceted nature of customer needs and the importance of understanding them to deliver relevant products and services. Customer needs are the driving force behind purchasing decisions and they are closely intertwined with goals and motivation.

People experience a problem or pain-point and set the goal to alleviate it. It is this journey from a current state to a desired state that forms the basis of understanding customer needs.

Be mindful that needs are:

Conscious and subconscious.
Promotion and prevention oriented.
Functional, emotional and social.

And use this information to better identify your customers’ needs so you can cater to them. Your success lies in how well you can understand your customers path from pain-point and problem, to need, motivation and goal — and how effectively you can facilitate this journey.

References

1
Barden, P. (2013). Decoded. Wiley & Sons.
2
Christensen, C. M., Cook, S., & Hall, T. (1995). Marketing Malpractice: The Cause and the Cure. Harvard Business Review, 83(12), 74–83.
3
Moskowitz, G. B. (2002). Preconscious effects of temporary goals on attention. Journal of Experimental Social Psychology, 38(4), 397–404. https://doi.org/10.1016/s0022-1031(02)00001-x
4
Pieters, R., & Wedel, M. (2007). Goal Control of Attention to Advertising: The Yarbus Implication. Journal of Consumer Research, 34(2), 224–233. https://doi.org/10.1086/519150
5
Griskevicius, V., & Kenrick, D. T. (2013). Fundamental motives: How evolutionary needs influence consumer behavior. Journal of Consumer Psychology, 23(3), 372–386. https://doi.org/10.1016/j.jcps.2013.03.003
6
Christensen, C. M., Cook, S., & Hall, T. (1995). Marketing Malpractice: The Cause and the Cure. Harvard Business Review, 83(12), 74–83.

Customer Needs: The Complete Guide for Marketers