Consumer Needs—Have We Overrated Them?

Consumer Needs—Have We Overrated Them?

Torkel Tallqvist, April 4, 2013

Tallqvist, Torkel: Consumer Needs—Have We Overrated Them?

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In the media, in business schools, and in boardrooms everywhere, customer need is seen as the Holy Grail of innovation and business success. Fifty million Elvis fans couldn’t be wrong!

The truth is that we can’t possibly know what consumers need. We can only guess. The human mind is always private, only fractionally open to outsiders.

We can track only traces of consumers’ thoughts. One important piece of evidence is what consumers say, but more accurate are their actions—and how those actions provide traces of their thoughts.

As a user, you may not always be consciously aware of your own needs. On the surface, you need a car. But will any car do? Probably not. Perhaps you need a Porsche, for instance, but the need for a Porsche may have several classes of hidden demand attributes other than the utilitarian function of a car.

When we consider innovations, consumers are rarely aware of the solution that fits their needs. If they were, there would be no ‘wow!’ effect. How could they be aware, if an innovation is unseen, unknown, and yet to be experienced? The need cannot be disqualified as the unit of analysis. The view inevitably falls short, however, as the need is like the stars in the sky: we do not always see them, but we know they are there somewhere.

But where do we go if we abandon conventional thinking about consumer need? Here I experiment by changing the perspective, while maintaining the goal of finding the truth about enduring innovation and business success.

At this point I must quote C. Christensen (The Innovators Solution, 2003):

‘Companies that target their products at circumstances in which customers find themselves, rather than at the customers themselves, are those that can launch predictably successful products. Put another way, the critical unit of analysis is the circumstances and not the customer.’ It’s like funeral garb; you don’t wear a black suit because of a need, but because of the funereal dress code.

It would be easy to argue that by replacing ‘customer need’ with ‘circumstances’ we merely move ourselves from one hazy situation to another.

I argue, however, that there is a potential reward for taking this risk of temporary madness. It’s possible to learn something new.

But if we reduce the circumstance to the spatial location, for instance, we see that observing the location provides a firm an immediate contact with its users and the environment. In my research on innovation activists, I’ve discovered a pattern of thinking relating to the location, where the innovation Tallqvist, Torkel: Consumer Needs—Have We Overrated Them?

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is considered valuable and is being purposefully used. The specific place where the product is used can be called ‘the stage’ and the larger environment in which it is used, ‘the arena’. The objects related to the product directly connected to the use of the product are ‘the staging’. Finally, the piece of life on the stage and the arena are ‘the show’ associated with the use.

Consider, for instance, a boatyard for building yachts. It was organized at the Porto Cervo Yacht Club, which acts as the stage. The staging is the fleet of competing yachts, the arena is on the Sardinian Sea, and the show is a particular yachting race. This biannual venue is a community for owners, would–be owners, agents, boat builders, celebrities, and the media, and it serves as exposure for new models. I propose that this pattern of thinking provides the yard with a unique entry into the mind of its users, around which a business-making venue and a laboratory is organized. What is the consequence if the show is altered from racing to cruising, and the other entities follow from that? What new opportunities are produced?

To add another argument by following and analyzing the action—the ‘use’— we can assume that the observation of use tells us about the consumer, in a way that is comparable to an analysis of consumer needs. The convention would be to discuss the usability of an innovative product. But I encourage you to look on the other side of the coin. In my studies of innovation activists, I have recognized a pattern of thinking relating to the use. Here, attention is paid to activities of use, momentary experiences of use, and the enduring outcome or benefit that the user gains from using the product innovation.

The activity of sailing brings the experience of joy and excitement, and the enduring outcome is a lifestyle that follows from this line of activity. Having said all this, I have not explicitly addressed the consumer’s need, but then again, I believe that I have spoken of nothing but consumer–need–related matters.

‘So what?’, you may ask. The consumer is generally one of the categories of matters that directly relates to the fundamental purpose of the firm. If you change the view of that fundamental idea, even a little, it may have major impact on a business enterprise. This piece of knowledge may relate to a phenomenon that Malcom Gladwell addresses: ‘how little things can make a big difference.’

In the boat–building case, the presented thinking and solutions reflect the awareness of the boat builders, ‘we don’t live the products’; those who build the yachts aren’t necessarily sailors, even if the yard is recognized as one of the top yards in the world.

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Think of it! What will a competitive market look like, if every firm acts in the same way, obeying ‘consumer need’ as the leading idea? Bigger and bigger firms are created through mergers, which, in the end, resemble bureaucracies like the state–owned monopoly firms. What is lost is the diversity and creativity of the dissidents of the market.

These thoughts are devoted to those who exploit new paths of thinking, paved by the yet mysterious, the yet neglected, the yet futile—the seeds of innovation and reality to be.

Tallqvist, Torkel: Consumer Needs—Have We Overrated Them?

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