What do we mean by demand-side and supply-side?
Supply doesn't create demand—demand exists whether you see it or not. The Segway failed at $5,000 despite brilliant engineering; Bird hit $1B by understanding the actual "jobs" people needed done.
Read Original Summary used for search
TLDR
• Most companies build products first (supply-side), then ask "who will buy it?"—leading to aspirational feedback that doesn't reflect real trade-offs
• Demand-side flips this: ask "what did you do?" to understand the circumstances that caused people to buy, not what they might want
• Segway built a $5,000 marvel of engineering but failed because they were married to their solution without understanding the full "job to be done"
• Bird Scooters identified specific jobs (running late for work, tourists avoiding cars) and designed around those circumstances—fastest company to $1B valuation
• Supply-side thinking leads to iteration and running out of options; demand-side gives unlimited options because customer needs are boundless
In Detail
The fundamental mistake in product innovation is believing supply creates demand. Companies typically look at their capabilities and ask "what can we build?" then turn around and ask "who will buy it?" This supply-side approach leads to aspirational customer conversations—asking "do you want this?" gets you "sure" responses that don't reflect actual purchasing trade-offs.
The demand-side approach flips this lens entirely. Instead of talking about your product, you ask customers "what did you do?"—understanding the circumstances that caused them to buy. This reveals the "jobs to be done" framework in action. The Segway vs. Bird Scooters comparison illustrates this perfectly: Segway built a beautifully engineered $5,000 device based on the insight that "people don't want to walk everywhere," launched with massive fanfare, and ultimately retired the brand after 20 years of disappointing sales. Bird asked "what are people trying to get done?" and discovered specific jobs: people running late for work when the bus schedule doesn't line up, tourists wanting to explore without walking ten miles. They designed low-cost rentable scooters with GPS tracking around these jobs and became the fastest company to reach $1B valuation.
Both supply and demand perspectives matter—you need to understand business strategies and maximize efficiencies. But you must view supply through the lens of demand. They're interdependent systems that can conflict, and the key is making explicit trade-offs acceptable to both sides. When you understand demand first, you can see how your product fits into people's lives, identify which jobs it fulfills, and determine what to add, exclude, or change. Supply-side thinking leads to iteration until you run out of options; demand-side thinking offers unlimited options because customer needs are boundless.