Needs-Based vs. Solution-Based

Some notes from a discussion on the differences between needs-based and solution-based strategy:

In theory, needs-based strategy begins by examining a market segment and identifying a common set of needs, then defining a solution that will satisfy the needs (at a price consumers will be willing to pay), whereas solution-based strategy begins with a solution (product or service) and then seeks to identify needs in the marketplace to which that solution can be applied.

In practice, it can be difficult to distinguish between the two, as it's highly speculative as to whether a company that sells a given product began with the notion of the solution or an examination of the need. Several examples were discussed, and in each instance, the discussion ended in stalemate.

It's also not a given that needs-based strategy is the better approach. It certainly is the newer of the two, and there's often the notion that "new" is somehow better. But upon detailed consideration it seems reasonable that a solutions-based approach can be successful (in that there is a coincidence of solution and need) and a needs-based approach can fail miserably (if the company lacks the expertise to deliver a satisfactory solution).

Neither is it a given that the choice is necessarily exclusive to one or the other. A solution-based company can identify additional needs for its product, or make modifications to its existing product to suit different or changing needs. The argument that it is in a better position to do so that a company that may be aware of needs, but lacks experience in providing the solution, holds some merit.