Needs, Wants and Demands are a part of basic marketing principles. Marketing strategies should be based on your target market’s needs, wants, and demands.
Marketing is all about identifying and fulfilling the needs of the customer. The needs are basic human requirements. There are three important concepts in marketing: needs, wants, and demands. Understanding your target market’s needs, wants, and demands will help you better market your products. Needs are things that satisfy the basic requirements. And what distinguishes a want from demand is whether the customer wants something specific but is willing to pay for it. Consider consumer electronics, an item the customer wants to use but may not be able to afford.
Needs
“Needs” are the basic human requirements that are needed to survive. These necessities include shelter, clothes, food and water. One can say that products in need categories don’t require any push. Instead, the customer buys it themselves. But it’s actually not true. In today’s world, the market is becoming increasingly competitive, and so brands are fighting for attention—Examples of needs category products/sectors – Agriculture sector, Real Estate, Healthcare etc.
We all know about Maslow’s hierarchy of needs, which categorizes needs into 5 levels starting from physiological needs at the bottom and going up to self-actualization needs. As a marketer, it’s important to know how your brand has targeted these needs. Companies have different products for different consumer needs. Let’s take a look at some brands targeting different levels of needs.
1. Physiological Needs – Food companies (Nestle, Pepsi, Coca Cola)
2. Safety Needs – Insurance companies (ICICI Prudential, Tata AIG, HDFC Life)
3. Social Needs – Social networking sites (Facebook, Twitter, Instagram)
4. Esteem Needs – Luxury brands (iPhone, Mercedes)
5. Self-actualization needs – Non-Profit organizations and NGOs (UNICEF, Teach for India)
Wants
The desire for products or services that are not necessary, but which consumer wish for. Humans have unlimited needs, and to satisfy them, people desire different things, like products or services and ways of doing things. Needs are something essential for your survival. Whereas wants are intangible and volatile – something you may desire but don’t need. As time passes, people change their wants accordingly. The desire for different things varies from culture to social class and from personality to personality. Marketers can influence human wants by providing a wide range of need-satisfying products. Example of wants category products/sectors – Hospitality industry, Electronics, FMCG, Consumer Durables etc.
Demands
When a customer is willing and able to buy what they need or want, it becomes a demand for the organization. Want becomes demand when supported by purchasing power. For example, everybody would like to drive a Mercedes, but everybody cannot afford it; that’s why only those wants which are backed by purchasing power will be calculated as demand. People can make demands because they have the ability, willingness and desire to buy what’s necessary. For a marketer, demand is very important. It plays a significant role in managerial decision making. This helps to forecast the demand while doing strategic marketing planning.
Conclusion
First, you need to figure out the underlying need that your product will satisfy and who are the consumers who might want your product. Depending on their external and internal environments, different people might want different things. Marketing strategies should be based on your target market’s needs, wants, and demands. Before you develop a marketing strategy for them, make sure to consider the underlying customer needs and demands.
