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PM Essence
Do your customers know what they need? 
                                                                                            -    Harith S Gopal
In a conversation with a colleague last week, we were discussing about how we should work towards understanding customer’s need accurately both from a functional as well as emotional perspective and attempt satisfying them in a financially viable (rather, profitable) model. A need is a benefit sought by a customer in a specific context. While some needs are stated explicitly, many others are left unstated and require us to observe them. As marketers, our job is to understand important customer needs, and provide solutions that satisfy those needs.

To run successful, profitable businesses (especially in the services industry), it is imperative for companies to bridge gaps between what I call “Perceived”, “Actual” and “Contractual” needs. Perceived need is what the customer “thinks” he / she wants, Actual need is what the customer “really” needs and the Contractual need is what the customer is going to “pay you for addressing”.
 
 
 

 Do your customer

As marketers, how do we address the difference between these and get these circles to overlap completely?

 

Start with the “problem”. Instead of going by what the customer says he / she needs (which is invariably a solution he / she has already thought of), work on identifying what problem he / she is trying to solve. This can be a good starting step for you to think of possible solutions to solve the problem and arrive at the actual need. You can then identify the differences between this and what the customer’s perceived needs are.

 

“If I had asked people what they wanted, they would have said ‘faster horses’.”

– Henry Ford

 

The next step is to try to handle both needs together, linking them in your customer’s mind. One suggestion would be to gently educate them that their perceived need many not be the ones they actually need. Make them understand that the actual need is the one to be addressed. This is tough for marketers though. There is a very thin line between being seen as someone who takes care in the customer’s interests and someone who is arrogant & insulting. Your competitors are waiting to do “whatever” the customer wants and take their money. Treat both, the perceived and the actual needs as sensible ones by taking a very neutral, educational tone.

 

The third piece is agreeing on the commercial model that is required to address the needs of the customer. The customer is going to pay you only for what is written in the contract. So, it is very important to work with the customer and arrive at the “contractual” need (often referred to as “Scope”) and map it as close as possible to the perceived and actual needs and build a commercial model that supports this.

 

I am not trying to say that customers do not know what they want - I would like to emphasize that the customer knows his / her business & problems the best. The only thing you can consult / educate them on is how you can help them solve their problems (or address their needs) with solutions that you provide. Doing what I have indicated above can only take you closer to solving your customer’s problems and satisfying them in a way that is commercially viable for you.

 

Always remember the following three mantras for building a successful customer focused business -

1.    Customer is the King (He / She pays your bills)

2.    Customer is always right (He / She knows the problem & business the best)

3.    If your customer has a problem, go out of your way to help him / her solve it (If you don’t, your competitors will)