Differentiating Customers by Their Needs

You can't be everything to everybody, but you can be something to someone. To create value for customers a business must be able to see the customer's perspective and those perspectives will differ based on the individual. Customers want to have a problem solved, or get a job done. That job can be looking and feeling fabulous or it could be fixing the kitchen sink. 

Customer needs can impact various aspects of the business model from the product to how the customer buys the product, the way it is delivered, the communication style and channels, to invoicing. Needs and value is where the value proposition between a business and customer comes to life; what can the business to for the customer and what can the customer do for the business. A business can have end-users and customers (i.e. clothing or beer) and the firm needs to decided who to focus on to create value. 

Product benefits and attributes are not the needs of the customers, all customers have different needs, the benefits help solve those needs. Customers can have very similar demographics, but very different attitudes towards themselves, their families and society, their beliefs, values, behaviour and their lifestyles. A company needs to take a customer perspective, and only once a perspective is met can a firm influence a customers behaviour. By segmenting based on needs companies can direct marketing effectively to these groups by creating customer portfolios. 

It is important to note that there are various aspects to understanding needs, including:

  • Customer needs can be situation in nature
  • Customer needs are dynamic and can change over time as well
  • Customers have different intensities of needs and different need profiles
  • Customer needs often correlate with customer value 
  • The most fundamental human needs are psychological
  • Some needs are shaped by other customers while some needs are uniquely individual
  • There is no single best way to differentiate customers by their needs
  • Even in B2B selling, a firm's customers are not really another "company" with a clearly defined, homogeneous set of needs.

A successful company builds a learning relationship with customers and is agile enough to change the enterprise's behaviour toward the customer based on more in-depth knowledge about a specific customer.