DIFFERENTIATING NEEDS WANTS AND DEMANDS: THE MARKETING CONCEPT

“To be happy in our life, we must learn to differentiate between what we want and what we need.”

We, humans, have infinite wants and demands and when the feeling of deprivation emerges and our mind requires something, we call it needs.

Needs, Wants and Demands are a basic part of the marketing principles. On the surface, these three words look like simple, easy to answer concepts.

NEED, WANT & DEMAND are similar words that have destroyed countless human lives. This is because even after years of education, people can’t distinguish between these. So, why it is required to be distinguished? Let’s me explain this with a small example that might be helpful-

Suppose you belong to a rich family and you don’t have any constraint with your monthly drawing, and suddenly you only tend to get a fraction of the amount to spend for the whole month, there is a very high chance that you won’t be able to get through the entire month with that amount. Can you?

And now assume that the same fraction of amount is received by a boy or a girl who belongs to a middle-class family, which will probably shoot up the requirements even if it is not required, and the same would be much more for a person who belongs to a poor family.

This is a very simple situation and will help you to mirror when we are here talking about what we need and what we want and the demand per se.

This eventually affects our buying decision, and businesses who market their product need to consider this the most.

For Example- Every one of us needs a home (we call it shelter) but the type of home we get for ourselves is the result of the psychological or learned needs.

Understanding the difference between a customer’s wants and needs is a major key to succeed in business. Often what a customer wants is diametrically opposed to what they need. As a businessperson, your job is to give the customer what they want. Helping them to understand what they need is also important.

However, it’s not your responsibility to convince customers to get what they need.

Businesses make money by satisfying their customers. Often, it’s easier to sell them what they want than what the need. So that’s where businesspeople should primarily focus their energy.

These three vital terms play an important role in marketing management and facilitate dealing with many monotonous problems while marketing products and services.

• Why should marketers know about customer’s needs, wants, and demands?

• To know the target customers and target markets

• To take strategic decisions and implementation

• To promote the products with suitable advertisements

• To maximize sales and profits

• To know the customer’s willingness to buy the products

• To know the number of customers who can buy their products

• To know the influence of demographic, socio-cultural aspects and income levels on the buying behavior of consumers.

• To predict sales in a target market

NEEDS

Needs are basic requirements such as food, shelter, clothing, water, and safety. Human survival is not possible without fulfilling these needs, here a need shows the status of deprivation. According to marketers’ point of view, human needs can create repeated sales irrespective of wants and status.

If the marketer’s products are in the NEEDS category, then it is not required to put extra promotional efforts to maximize sales and for repeated purchases. Needs force the customers to buy the products continuously and repeatedly.

And in order to fulfill the basic requirements, humans sacrifice their wants, fantasies, and dreams also. So, depending on the product category market decides sales and profits. Products related to the agriculture sector, water, textile, and FMCG, etc, come under this category.

Customers give very little preference to brands in the case of products related to need category. For example, if a person feels thirsty then he/she simply buys water and fulfills the need, but they do not give much preference to a brand and they do not wait for long hours. This is the reason there we can see sales for similar products in the same place. Hence, so many brands are offering similar products in order to satisfy the growing customer needs.

WANTS

Wants are not basic requirements & these are not essential for human existence, but there exists a relation between needs and wants. If a need arises then it stimulates human tastes and preferences and finally wants arises, because wants are not immediate needs. Wants are not permanent and can change depending on the time, people and location.

For example- If a person feels thirsty then he/she can drink water to fulfill the need, but the wants force a person to drink cold-drink or fruit juice.

Wants are not mandatory but marketers promote the want category products and services in such a way that these products are a mandatory part of life. In fact, wants are not necessary for human survival and changing tastes and preferences of the customers forces the marketers to create new products and services

In the case of needs, customers do not give much preference to the brands, whereas in the case of wants customers to purchase what they want only. These wants are not immediate needs so that customers can spend the time to select the desired colour, flavour and features also.

To promote the want category products marketers, need to put extra efforts in order to satisfy the changing tastes and preferences and wants as well. In the case of want category products.

For Example- Pizzas, ice creams, juices, branded cloths, fine quality leather footwear, ornaments, and well-furnished house, etc.

DEMANDS

Willingness to buy & the ability to pay creates demand for a product. Human wants can create willingness and here, buying power can convert these wants into demands.

For example- If a person is willing to buy a gold chain then the buying power or ability to pay should support his/her willingness, then only it becomes a demand for the gold chain.

The marketers should analyze the market conditions & income levels of the target customers. If the marketers do not concentrate on the economic conditions of the country and per capita income, then they may not create sales effectively, though their product is highly qualitative, and value created and willingness to buy and the ability to pay creates the demand.

For example- Gold, Diamonds, Luxury cars, Star hotels, etc