Central to design innovation is an understanding of consumer behavior and needs. Arguably, the success of a new product or service depends on the ability of the company to understand the unmet needs and latent demands of its customers. An unmet need is a need that the customer can either demonstrate or vocalize that is currently not satisfied by viable market alternatives. For example, consumers with arthritis may be able to vocalize or demonstrate that they need a way to help them manage their medication schedules while traveling. Consumers may be fully aware that they have more difficulty remembering to take their medication when their routine is interrupted but they may not be aware of how to address the issue or if products are available to provide assistance. Addressing unmet needs is one of the best ways for companies to discriminate themselves from their competition in a crowded market. In contrast, a latent demand is a customer requirement that only becomes evident when the technology or product is made available. In cases of latent demand, consumers are not even aware that they have an unfulfilled need until the solution is offered. By addressing a latent demand, a company can produce products that move the market in entirely new directions.
The process of identifying unmet needs and latent demands is addressed by a needs assessment in the Consumer Product Integration (CPI) process. In practice, a focus group is often utilized as a substitute for a formal needs assessment when trying to identify product requirements; however, there are a number of concerns associated with relying solely on focus group data. First, people often have difficulty predicting what they will do some time in the future. When asked to project how they will perform or what they will do when some future product becomes available or in a job function they are not experienced with, they often produce unreliable testimonies. This behavior can lead to rationalizations that produce seemingly unmet needs that have no real relationship to true needs. Second, people do not really know what they want or need. When asked directly, people may communicate what they think they need or focus on a very specific need that appears attractive at the time. Using focus groups as the sole means of needs assessments may result in the identification of, at best, a biased assessment of user needs and, at worst, an incomplete or misleading needs identification. Third, people cannot comment on things that are very different from their own experience. Focus groups are most useful when the design team is focusing on incremental design changes and the participants have had experience using the products being discussed. Focus group feedback is less useful when the focus is on design innovation since users are being asked to comment on things that are, by definition, outside of their experience. Finally, focus groups are very poor at identifying latent demands since latent demands are needs that are currently not in the conscious of the consumer.
In summary, a focus group should not be used as a substitute for a needs assessment. A focus group is simply one tool among many that can be used to help identify unmet needs. A proper needs assessment utilizes a combination of techniques such as subject matter expert structured interviews, observational studies, technology forecasting, and product usage analysis to identify unmet needs and latent demands. Researchers performing a needs assessment will often spend time observing the behavior of consumers using a product in the proper context in order to gain key insights. This type of focused ethnographic research is often more valuable than focus group research particularly when the focus is on design innovation. When the focus is on incremental design, a focus group can be a useful resource but over-reliance on the research technique can lead to unintended consequences.