Needs, Wants and Demand – What Are the Differences?
Products and services typically fall into one of two categories for the consumer, needs and wants. Needs are those things that are essential, such as food, water, medicine, etc. Wants are those things that are not needs, but would be nice to have.
Consumers typically accept the costs associated with filling needs as inescapable, even though they may complain about high prices, low quality or poor service. When filling their wants, however, they become more demanding, and tend to shop around, analyzing the benefits of purchasing from one supplier versus another. Branding becomes critical at that juncture, in order to establish an advantage over the competition.
For the marketer, there is a third aspect… that of demand. Demand is defined as wants, backed up the desire and ability to purchase. It is more important that the marketer determine if a demand exists, rather than a need. Many products are offered, to fill a very real need, but if the consumers don’t want to buy it, then no demand exists, and sales will be flat.
Some marketers attempt to create a demand, by creating the perception of a need. Surprisingly, many consumers are vulnerable to this tactic. Even though academically, they realize that the desired item is a want, their desire is so strong, that they begin to see it as a need. The desire, coupled with the ability to purchase, then establishes a demand.
A successful marketing strategy will succeed in establishing a demand for items or services that are normally considered as wants, while focusing on branding for those items classified as needs.
As an example, when you are dehydrated, you need something to drink. But if you happen to prefer lemonade to water, then you would want lemonade. If someone can convince you that their lemonade is superior to any other, and better for you than water, then they may convert your want into demand for their product.
Written by: Matt
We also suggest this relevant article if you have time: Blue Ocean Strategy by W. Chan Kim
Some other similar articles
Tagged as about marketing, demand, marketing, marketing theories, need, wants + Categorized as Economy articles, Other, Marketing