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The Importance of Needs-Based Products and Services 
by Catherine Brock May 23, 2005

The Importance of Needs-Based Products and Services is written for would-be entrepreneurs, small business owners and other non-marketing types who want to start up or grow their businesses but don't know how. The topic of discussion is the importance of basing products and services on specific customer needs. The article covers product focus vs. customer focus, how the focus affects planning strategies, and how to define the customer and need of an existing product.

Designing marketable products and services is tricky business. Product failure is common and hits all types of companies. Well capitalized, global businesses, middle market players and niche market entrepreneurs have all funneled resources into product ideas that have little chance of survival.

There are two essential questions of product/service development: What problem does this product solve? Who exactly has this problem? The answers will be the foundation for refinement of the product concept and development of marketing strategies. In order to sell a product or service, you have to know who is going to buy it and why. Seemingly obvious, these questions are often overlooked by enthusiastic entrepreneurs.

A product idea has a way of blinding those involved in it. Our faith in its marketability is so strong that we overlook contrary evidence or fail to examine the meaningful details. Business owners and executives may spend hundreds of hours analyzing the wrong things, only to be faced with disappointing sales when the product or service is launched. This is often the result of focusing on the product itself and overlooking the customer.

A strong emphasis on the needs-based aspects of the product/service, from conception through launch and beyond, is critical to avoiding this pitfall. Marketable product and service ideas must address a specific customer need. This need may be existing in the marketplace, or it may be created by the advent of the product. The fax machine, for example, was developed to address a need for faster document transmission. On the other hand, the range of new-generation digital products available today - DVRs, iPODs and the like - have created a new set of needs, based on more general desires for convenience and mobility.

The answers to "What problem does this product solve?" and "Who exactly has this problem?" should form the basis for your core product/service concept. If you can't define a specific need and customer associated with your product, consider it a red flag. Go back to the drawing board and fine tune the concept with your customer's needs in mind.



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