At White Space we’ve seen first-hand how the allure of creating an innovative product can overshadow the fundamental driver of meeting customer needs. However, as highlighted by Olie Lobo in a recent exploration, the essence of a successful proposition lies not just in its novelty but in its ability to address genuine customer needs. Without this alignment, even the most exciting products risk fading into obscurity. Garnering a deeper understanding of your customers’ needs is a critical input which underpins the innovation process.
Having a true understanding of your customers’ needs in a B2B setting can be particularly challenging. Often your direct contact is with buyers rather than the users of your product or service and the end-users themselves can be especially challenging to reach, whether that is remote utilities field forces using specialised hardware or chefs working in Michelin star restaurants. Taking the time to hear their views could pay off significantly in the long run.
Before scheduling in any concept creation session, firstly check if you can confidently answer the following questions:
What are your customers’ range of needs?
The first step towards building a needs-based proposition is to deeply understand what your customers value most. Distinguishing between what is business critical and what is considered low priority allows you to develop products or services that address the most pressing needs. Do you know what the business critical priorities of your target customers are?
Furthermore, engaging with customers at this stage may unearth a range of unmet needs which businesses are grappling with. If you can understand the processes they go through, can you identify areas where you might be able to help simplify, quicken or improve their tasks? Throughout our recent financial services work, asking customers to walk us through their payments process threw up multiple areas of inefficiencies, frustrations, and cost; all of which weren’t on the radar of our client. Gaining these first-hand insights may put you in a leading position when developing a differentiated product or service.
How much pain do these needs cause?
The value that any solution offers is closely aligned to the level of pain that this could alleviate for the customer; whether that’s saving time, reducing costs, or eliminating a cumbersome process. If you can quantify the level of pain that your solution alleviates, you can justify a pricing strategy that reflects this and often command a premium in the market.
Is this a daily need which all staff members have e.g. tracking their time or paying expenses? A streamlined product here could save a business hours or days of resource in the long run. Conversely if once a year, one assistant has to run a slightly cumbersome process, how much value does an improved product truly offer to the business?
How do these needs differ?
Analysis of your research may reveal that there are some needs common to most organisations and therefore may represent the primary needs to address. Alternatively, customer needs and priorities might vary between different customers segments, be it by type of organization, geography, or individual preferences. This diversity presents a strategic decision point: should you broaden your proposition to cater to a wider audience or specialise to serve a niche market more effectively? The answer often lies in understanding the market size and sales potential of each segment, balancing the allure of a larger audience against the benefits of specialisation.
Are these needs changing?
Businesses’ needs are constantly evolving, driven by factors like upcoming regulations (such as PPWR in the packaging market or PSD3 in the financial world), and tech-enabled behavioural changes. Can you identify what the emerging needs of the next 5 years are likely to be? Being first to market with a solution that meets emerging needs puts you in a strong position and may even allow you to define a new market. On the flip side, not keeping pace with market trends or regulatory changes can quickly make your product irrelevant. Having your finger on the pulse of market shifts is crucial to ensure your offering stays competitive.
Conclusion
Building a proposition around customer needs is not just a strategic choice; it’s a necessity for businesses aiming for long-term success and relevance. By understanding customer priorities, addressing significant pain points, staying responsive to changing needs, and thoughtfully considering the diversity of your target audience, you can provide critical strategic input into your proposition development process. Understanding customer needs should be one of the first stages of your process and should form the bedrock for customer-centric innovation.
At White Space Strategy, we specialize in guiding businesses through the intricate process of developing needs-based B2B propositions. If you’re looking to refine your approach and ensure your next product or service hits the mark, we’re here to help.