customer needs and expectations in business

Last week we looked at the link between quality and brand performance. This week we look at how customers’ needs change over time, and the way their expectations of products also change.

​For a brand to be successful, wherever it is sold it must:

1. deliver functional benefits to meet the market need at least as well as the competition does

2. offer intangible benefits over and above the basic benefit of the core product

3. comprise various benefits which are consistent with each other and present a unified character or identity

4. offer special features that customers want, that is, something valued and which customers judge nobody else can offer. Being ozone-friendly or low in cholesterol are features that are appropriate in the 21st century, although they probably would not have sold many products 50 years ago!

As a final comment on meeting customers’ needs and wants, we can link together our discussion on product levels, product life-cycles and brands. We have seen that customers’ needs change over time and their expectations of products also change.

Needs may change because circumstances change; for example, when a couple have children, they may need a larger car. Consumers’ expectations change as organisations develop and later products and think up new features and benefits which add value to their offering.

Customers begin to expect new features as part of the standard offering and look to organisations to provide them. The implication for organisations is that they have to continually develop the products they offer as well as launch new products to fulfil new needs that customers may have.

It also means that over time some products are no longer wanted by customers so organisations have to stop providing them and therefore need other products to replace the revenue that they lose. In order to achieve this, organisations need a balance between cash-generating or resource-attracting products (income) and cash- or resource-using ones (expenditure).

Organisations cannot sustain a negative cashflow over a long period unless they have substantial reserves and clear objectives for doing so. So a major task for organisations is to decide which products to encourage and develop, continue with, phase down or phase out in order to maintain cashflow.

Organisations also need a constant flow of new ideas from which new products will eventually grow and be introduced to the market.

In addition to new product ideas, other innovations are necessary:

• additions to bring variety to an existing product range - for example a car manufacturer adding an extra model to the range, or a bank introducing a new savings account
• repositioning — targeting existing products at new markets or segments of markets
• improvement to or replacement of existing products. We see this in most product areas on a regular basis. For example, in the UK the Vauxhall Vectra car was updated after its introduction to change its body shape slightly, improve certain design areas, and update and upgrade the technology used in the engine. In time, Vauxhall improved the car again, before eventually replacing it with a new model with a different name and shape, but aimed at the same target market.

New product development, then, is an important part of any organisation's activities. It does not happen by chance, but must be planned for and given resources to ensure it happens.

A final implication of the constantly changing nature of customers’ needs and expectations is the development of brand names by organisations. This drive is aimed at creating repeat purchasing among customers and, hopefully, loyalty to a particular product.

This means that although organisations still need to improve existing products and develop new ones, customers may continue to buy an organisation's products because they trust the quality, and feel an affinity with the brand identity rather than because it always provides the most innovative products.

If you would like to look at how to implement an ISO 9001 quality management system, then simply contact us.

Or, if you want to see what's involved in more detail, then get a completely free, no obligation, totally tailored ISO Gap Analysis for your business (only available to UK businesses).

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