Understanding 3 Common Types of Customer Needs

Whether you’re a new entrepreneur, an established business owner, or an employee within a company, your success is often measured by how well you convince potential customers to purchase your product or service.

Achieving this requires understanding your business’s market and competition, its differentiating factors and value proposition, and, most importantly, your ideal buyer. Specifically, you need to know the motivations, goals, challenges, and desires that lead them to purchase a solution like yours.

It’s useful to think about this concept in terms of customer “needs.” What does a potential customer need that leads them to your solution? Understanding that need can enable you to not only tailor your sales and marketing messaging, but inform your product research and development, customer service, and other aspects of your business.

What Are Customer Needs?

A customer need is a need that motivates a customer to purchase a product or service. The need can be known (i.e., the customer can put it into words) or unknown, and is the ultimate factor that determines which solution the customer purchases.

One effective way to determine and evaluate customer needs is by using the lens of “jobs to be done.”

Customer Needs as Jobs to Be Done

According to the jobs to be done (JTBD) framework, championed by Harvard Business School Professor Clayton Christensen, customers don’t purchase a product; instead, they hire it to complete a certain job or task.

In the online course Disruptive Strategy, a job to be done is defined as a “circumstances-based description of understanding your customers’ desires, competitive set, anxieties, habits, and timeline of purchase.”

By this definition, a job to be done aligns with a customer need. With a keen understanding of customer jobs to be done, businesses can avoid disruption and identify new opportunities as they arise.

Related: Jobs to Be Done: 4 Real-World Examples

3 Main Types of Customer Needs

Customer needs can be broken out into many different varieties and categories. For example, a customer might need a solution that has specific functionality, falls within a set budget, or provides a certain level of reliability.

Ultimately, all customer needs can be categorized into three main types: functional, social, and emotional needs.

1. Functional Needs

Functional needs are the most tangible and obvious of the three main types of customer needs. Customers typically evaluate potential solutions based on whether they’ll help them achieve a particular task or function. The product or service that best addresses their functional need is likely to be the one they purchase, or hire.

Functional needs can be broad or extremely specific, depending on the customer’s buying criteria.

For example, a customer who’s planting a garden for the first time might say, “I need a garden hose.” Meanwhile, an experienced gardener might tailor their criteria by saying, “I need a hose that’s long enough to reach my vegetable garden from my backyard spigot.” Another customer who’s dealt with the frustration of using a low-quality product might tailor their need differently by saying, “I need a high-quality garden hose that won’t tear or kink from regular use.”

With this kind of insight into customers’ functional needs, a company that manufactures garden hoses might develop new products, such as hoses that come in a range of lengths and don’t kink.

2. Social Needs

A social need is a customer need that relates to how a person wants to be perceived by others when using a product or service. While social needs aren’t typically a customer’s primary concern when considering a purchase, they can influence their final decision.

Social needs are often more difficult for a company to identify, and vary substantially from customer to customer. By understanding various social needs, you can look for patterns among your users. If enough of your customers share a particular need, consider how it can inform your product development, sales, and marketing processes.

Returning to the garden hose example, imagine the customer is a member of a gardening association. Members of this association have an affinity for high-tech gardening tools and regularly discuss new products they’ve tried. The customer may decide, either consciously or unconsciously, to purchase a hose with advanced features—for example, one that connects to a smart water controller—to bond with other association members.

If, on the other hand, the customer is an environmentalist who’s active in various communities, they might be more concerned about whether a hose is made from sustainable materials that their fellow environmentalists use.

3. Emotional Needs

Emotional needs are similar to social needs in that they’re typically secondary to functional needs. Whereas social needs refer to how a customer wants to be perceived by others when using a product, emotional needs refer to how a customer wants to feel.

Returning once more to the garden hose example, consider the reasons why the customer gardens. If they find gardening to be a relaxing hobby, they may be more likely to choose a basic hose over a high-tech option. Alternatively, if gardening triggers memories of the customer’s grandparents, they might opt for a brand that evokes that nostalgia.

While emotional needs can be difficult to pinpoint, companies that identify those of their customers can use the information to tailor and optimize their product messaging.

Identifying Customer Needs

If you’ve never gone through the process of identifying customer needs, it can feel overwhelming. However, there are several strategies you can use to identify those needs. Reflecting on your experiences, observing others' behaviors, and conducting customer interviews are all effective ways to gain those valuable insights.

By understanding your customers’ needs and the jobs they hire your products or services to perform, it’s possible to not just avoid disruption, but drive innovation within your organization and industry.

Want to learn more about jobs to be done and other theories from Professor Christensen? Explore Disruptive Strategy—one of our online entrepreneurship and innovation courses—and learn how you can acquire the skills and techniques needed to organize for innovation and craft winning strategies.