How to Understand Customer Needs With Needfinding

Have you everwondered why so many startups miss the mark? It often comes down to one thing:truly understanding customer needs. Understanding customerneeds is not just a step in the startup journey—it’s the cornerstone ofsuccess. Many startups fail because they overlook this crucial aspect, leavinggaps in the market unfilled. But how do we truly step into the shoes of ourcustomers, uncover their unmet needs, and create solutions they actually want? The answer lies in the powerful practice of needfinding—a research method thatguides you through customer discovery and reveals insights that drive productinnovation. 

In this article, we’ll explore the essentials of needfinding, from getting started with a customer-centric approach to identifying key customers and gathering insightsyou need to design a standout product or service.

What is Needfinding?

First introduced by Robert McKim in the 1970s during his time as head of Stanford University’s productdesign programme, needfinding is a qualitative researchmethod where we look for something without knowing what we are lookingfor. The goal is to try to find and understand customer needs that are not metwith current solutions, products, or processes. This need can be somethingphysical, emotional, intellectual or cultural. It can be an aspirational need – something your user aspires to – or a plain operational pain point, or anythingin-between. 

Unlike traditional market research,which often focuses on what people want or think they want, needfinding explores underlying needs, often unspoken or unrecognised by the customer. Inother words, needfindingis a great place to start during your customerdiscovery process when you want and build a successful new productor service. But there is a catch that many first-time explorers fall victim towhen researching customer needs – understanding the difference between a ‘want’and ‘need’. Let‘s have a look.

How Do We Understand Customer Needs Versus Their Wants?

Aneed is an opportunity waiting to be exploited. It is not a guess about the future, but something people are already experiencing as a need. A need spursaction and makes people search for solutions. A want isusually short-term, focusing on a specific solution to a temporary problem. A need is long term, lasting longer than a specific solution and expressing an underlying desire. However, a need can be extended as new technology changes user behaviour and in turn, needs.

One helpful way to identify a want versus a need is to apply the Jobs-to-be-Done Framework, originally developed by Tony Ulwick and his consulting firm Strategyn, and later popularised by Harvard Business School Professor Clayton Christensen. An explanation of the theory can be summarised in one sentence from Harvard Business School Professor Theodor Levitt: “People don’t want a quarter-inchdrill. They want a quarter-inch hole.”

Simply put, people invest in products orservices as a means to an end. Think about it—why do you really buy a chair? It’s not just for sitting; it might be for style or comfort. Or why pay for a gym membership? Chances are, it's not just for access to weights but becauseyou want to feel healthier and stronger.

However, the Jobs-to-be-Done Framework relies on individuals being aware of their needs and familiar with current solutions, which is often not the case. Therefore, when it comes to uncovering the deeper needs of potential customers, a more structured research effort is required—this is where needfinding comes into play.

Whose Needs Do We Consider?

Once we know what is that we are lookingfor from our customers, the next step is to actually identify your potentialcustomers. So, who should you talk to?

Start with two main groups: extreme usersand early adopters. These are the people who can give you the clearestinsights. These are ideal candidates because they can articulate the problemand can share the solutions they have tried. Furthermore, the more diverse thedemographic backgrounds in your sample of extreme users and early adopters, thebetter you will understand the problem.

Extreme usersrepresent individuals at the far ends of the product usage spectrum. Theyinclude both non-users and heavy users, providing insights into why a productmay be underutilised or why some rely on it so heavily. For example, if you’reimproving the gym experience, you’d want to talk to both people who avoid the gym entirely and those who visit multiple times daily.

Extreme users can also include people withunique physical or cognitive needs, such as wheelchair users, neurodivergent individuals, or those with health conditions that impact their gym experience.By studying these users, you gain insights into how to make your product more inclusive and adaptable, ensuring it meets the needs of a diverse customer base.

Early adopters, on theother hand, are quick to embrace new products and provide feedback. Unlike later adopters who may prefer well-established solutions, early adopters are willing to accept some flaws and are motivated by theopportunity to be part of something new and groundbreaking. They understandtheir own needs well and are usually eager to discuss their experiences and suggestions for improvement

Take Airbnb’s early adopters, for example. When Airbnb first launched, founders Brian Chesky, Nathan Blecharczyk, and Joe Gebbia were focused on findinga solution to expensive short-term accommodation for conference-goers. As such, their initial target users were convention-goers who actively sought alternatives to traditional hotels due to budget constraints or availability issues. These early adopters didn’t mind that Airbnb was still rough around the edges—they valued the access to affordable housing and the convenience of connecting with local hosts directly.

At the same time, these early adopters provided critical feedback that helped Airbnb refine its platform, addressing issues and making improvements that would appeal to abroader audience. Without these early users, Airbnb might have struggled to identify the essential features and improvements that made it a global success.

How to Find Extreme Users and Early Adopters

Now that you know who to talk to, let’s talk about how to find those people. There are many ways to engage with your potential customers, but in this article we’ve pinpointed what we find mosthelp in understanding customer needs:‍

Activate Your Network: Leverage your personal and professional connections. Ask friends, family, and contacts if they know anyone who fits your customer profile and might be open to an interview.

Cold Outreach: Reach out to potential users on platforms like LinkedIn. Although response rates may be low, those who respond are usually motivated and ready to share valuable insights.

Warm Introductions: After each interview, ask for referrals to other potential users. Personal recommendations often yield more willing participants and establish trust quickly.

Engage Where Users Are: Meet potential customers where they naturally gather. Think about where your target customers spend time and observe the behaviors early adopters might exhibit.

For example, if you’re researching skincare habits, visit a local store and casually ask a shopper’s opinion on a product. This relaxed approach can reveal valuable insights into their decision-making process and preferences without the formality of an interview.

Let Them Come to You: Post in relevant online communities or host events around your research topic. This approach can attract people who are actively experiencing the problem and eager to share their insights.

If you're diving into sensitive topics like housing affordability or chronic health concerns, the people who reach out are often early adopters—they know their challenges well and are usually keen to share. Hosting casual meetups, workshops, or even small conferences around these topics can help position you as a credible resource, making it easier for attendees to open up. In these relaxed settings, you'll often uncover rich, firsthand insights into the needs and behaviours of your most passionate users.

Need-Finding Strategies and Methods

Once you find the people you need to contact in order to do your research, it is time to collect the information needed to understand customer needs. There a three qualitative research methods that are particularly useful during the need-finding process: interviews, observations, and immersion.

Interviews

Interviews involve having question-and-answer conversations with potential users or customers. The goal is to uncover the emotions and motivations that drive their behaviours and determine whether there’s a need that isn’t being met.

Observations

One of the best ways to understand potential customers’ needs is to observe them in their everyday lives. This method involves watching people as they interact with products, services, or in certain contexts, in order to identify pain points or opportunities for improvement.

However, the awareness of being watched can cause people to change their usual actions–whether consciously orsubconsciously. This phenomenon, referred to as the Hawthorne effect, is a challenge you should be aware of during your observations, as this effect can skew the information you collect and make it harder to identify authentic needs and behaviours.

To minimise the chances of the Hawthorne effect occurring, avoid intrusions and don’t guide the subject or ask many questions. Your role as an observer is merely passive, so try to blend in with the user’s environment.

When completing your observations, you should also pay attention to the following points:

• The behaviour of the person or people that are your subjects
• The products these people are using
• The interaction between your subjects and the products they are using
• The activities that your subject or subjects are performing
• The environment in which all this takes place        

Focus on observing how people behave in their natural settings to understand their reasons and motivations. Pay special attention to any workarounds they use—these creative solutions often reveal unmet needs and can spark ideas for new, monetisable products. After all, no one owns a workaround—it’s not patented, and it’s often an untapped opportunity.

A famous example of this comes from the early days of smartphones, when people began using their screens as makeshift flashlights in the dark. You’ve probably done it yourself—coming home late, fumbling with your keys, and using your phone’s glow to find the lock. One developer noticed this workaround and saw an opportunity: he created an app called “Flashlight” that turned the screen bright white. By addressing this simple need, the app quickly became popular, reaching the sixth position in the App Store in 2009 and selling for 99 cents. This clever observation turned a common behaviour into a multi-million-dollar product.

Observation Activities to Understand Customer Needs

To truly understand customer needs, nothing beats observing them in action. Watching how people interact with their environment, products, or challenges can reveal valuable insights that are often missed in interviews alone. Here are several observation activities to help you gain these insights, from "deep hangouts" to simply being a “fly on the wall.” Each method has unique strengths, allowing you to explore users' natural behaviours, notice workarounds, and uncover unspoken needs that can inspire innovative solutions.

Deep Hangout

During the activity Deep Hangout, you spend time around your subjects, observing theirbehaviours. Pay special attention to hacks people use to make life easier.

Fly on the Wall 

In this activity, you stay in one place fora longer period of time. Our recommendation is at least 15 minutes. By takingthe time to slow down, you will see the world differently and observe thingsthat you may not have noticed before.

Shadow

Another activity involves shadowingsomeone. For example, you can follow a person during their workout to observetheir routine. A word of caution: if you are caught observing someone, it canquickly become awkward and the efforts may prove futile.

Guided Tour

An alternate option to shadowing someone isto ask someone, perhaps someone you have interviewed, to show you how they usea product or deal with a problem. It is crucial to view their environmentthrough the eyes of the potential customer or user. During the observation,make sure to ask questions.

Narration

In this activity, ask your potential customer to perform a task and talk about what they are doing as they do it. By doing this, the person articulates a behaviour that has become a habit, which leads to thinking about how to complete the task and therefore wondering about their own behaviour. This activity reveals the discrepancy between what people think and what they do.

Head Cameras

Providing subjects with head cameras and asking them to do whatthey normally do is a useful activity when researching locations and processesthat you may not be allowed to be part of or near. This is a great option ifthe potential customer is located in another country, for example, or in instances where speed is a factor and a guided tour would hinder that process.

This is not an exhaustive list, and manyother creative activities are available to observe potential customers or usersin their everyday lives. It should also be noted that the observation method isnot suitable for understanding what is going on inside a potential customer or user’s head. As such, observations are often combined with interviews.

Immersion

One of the most powerful methods incustomer discovery research is through immersion. You become your potentialcustomer or user and experience their challenges first-hand, both physically and emotionally. This method goes beyond interviews or observations and placesyou directly in your customer’s shoes. Immersion allows you to encounter problems in a more authentic way, revealing pain points you may not have anticipated.

Immersion is particularly useful when yourpotential customers differ from you significantly. For example, if your usersare from a different age group or have different physical abilities, immersioncan give you a clearer understanding of their daily struggles. Whether you’re trying on physical tools like vision-impairing glasses or simply engaging in unfamiliar experiences, immersion provides a rich, empathetic perspective.

That said, it’s important to be mindful of how far you go with immersive research—some experiments can lead to unintended consequences. Always weigh the potential impact and costs before jumping in. We recommend exploring a mix of research methods during your needfinding process, as there’s no “right” order to follow. Depending on the problem or the type of need you’re investigating, you may find that different methods (or combinations of methods) work best for uncovering valuable insights.

The Ongoing Nature of Needfinding

Once you’ve gathered insights through interviews, observations, and immersion, the next key step is to **synthesise this information** to fully understand customer needs. This process helps you uncover the core challenges your customers face, ensuring that you’re addressing real needs rather than surface-level desires. Companies that excel at needfinding and synthesising insights demonstrate how a deep understanding of customer needs can transform both products and entire business models. Here are some standout examples:

1. Airbnb
   As we already mentioned, Airbnb’s early success is a prime example of  understanding customer needs through needfinding. The founders initially focused on users seeking affordable lodging during large events. Through early feedback, they uncovered that users valued not only affordability but also unique, local experiences and seamless booking. By homing in on these insights, Airbnb transformed from a niche concept to a global platform that redefined travel accommodation​.
2. Dropbox
   Dropbox was born out of founder Drew Houston’s understanding of a  universal pain point—accessing files across devices. By observing workarounds, such as users emailing files to themselves, he identified the need for a more efficient solution. This insight led him to create a cloud-based tool that quickly became indispensable, showing the power of deeply understanding customer needs and turning those insights into a solution that resonates on a broad scale​.
3. Slack
   Slack began as an internal communication tool that founder Stewart Butterfield developed to meet his team’s need for a centralised workspace. Through direct observation of team dynamics and workflow pain points, Butterfield fine-tuned Slack into a streamlined, intuitive platform. This deep understanding of user needs allowed Slack to grow into an essential  tool for team collaboration, used by millions worldwide.
4. Instagram
   Instagram’s founders initially launched a multi-featured app called Burbn, but soon realised that users were primarily interested in photo-sharing. By focusing on this need for simple, visually appealing social sharing, Instagram rapidly gained popularity and user loyalty, underscoring the value of understanding customer needs and prioritising the features that meet them.

These examples provethat when companies truly understand customer needs, they create products thatdon’t just succeed—they thrive. By tapping into real, often unspoken needs, these brands built solutions that resonate deeply with users and stand the test of time. Staying connected to customer insights allowed them to adapt tochanging demands, ultimately cementing their place in the market as leaders and innovators.

That’s a Wrap

Remember, understanding your customers is ajourney, not a one-time task. Keep listening, stay curious, and you’ll build solutions that truly stand out. By synthesising insights, you avoid the pitfalls of assumptions and stay focusedon delivering real value. With needfinding as a core practice, your startup iswell-positioned to create meaningful solutions that stand out in today’s competitive market.

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