Yeah, pain points and inefficiencies are a popular way to look find ideas.
However, I have found following a user behavior to be a little more useful for me. Sometimes the new idea or innovation is not easily categorized as a pain point, like in the case of Twitter. People were posting status messages incessantly in IM. Once Twitter launched, users had a service that aligned closely with that behavior.
Most people wouldn't recognize the status message feature of IM as a pain point or inefficiency, it was just a feature.
