This article is one of a series on advances in obtaining and applying voice of the customer (VOC) information. The other articles in the series are VOC Advances: Complementary Innovation for Growth and VOC Advances: Helping Make Better Design Decisions.
The series was written by Anthony E. Curtis and Kimberly Watson-Hemphill as a wake-up call to those who have been content to use the easier forms of VOC, such as surveys and focus groups, as their primary (or perhaps only) means of understanding customer needs.
While those basic tools still have a place in today’s organizations, the authors point out, market leaders are getting much more sophisticated about how they gather customer information and what they do with it.
Most companies today say they are using voice of the customer (VOC) data to make decisions. But what exactly does that mean? In a 2002 survey by the Confederation of British Industry, with responses from more than 400 companies, the VOC methods mentioned included:
If a company’s goal is to stay ahead of its competition, there are two fatal flaws with this state of affairs:
There are some hard truths that businesses today are only just starting to grapple with. Most competitors in a particular field have access to the same customers and the same market information. The company that best understands those customers will end up with the biggest business advantage.
Developing this level of understanding demands skills well beyond traditional VOC techniques. Customers usually cannot explain their needs or wishes that would lead to innovative or transformational products and services because:
Simply asking customers what they like or do not like about current products or services will not work. Microsoft fell afoul of this by asking customers to attend a focus group, use their software for a few hours, and answer questions interactively. It went something like this:
Question: Did you like the product?
Question: Any features you do not like or want to add?
Based on these answers, it might appear that Microsoft had a winner right out of the gate. But when Microsoft developers began recording keystrokes and videotaping customers’ experience, they discovered a wide range of negative customer reactions – grimaces, hesitations, etc.
If simply asking customers what they like will not work, what will? The answer is incorporating close, detailed observation of customer behavior into design work. The epitome of this trend is the emerging field of customer ethnography, where a company finds ways to “live with” selected customers to get an in-depth understanding of their needs and how they use a product or service in real life. Ethnography is a discipline built on the principles of social anthropology, studying people in their native habitat. (Of course, in a business context, that habitat is more likely to be an office, school or home than the jungles of New Guinea.)
At its simplest level, ethnography includes any direct observation of customers with an eye towards identifying things that could make their lives easier. For example, Scott Cook noticed how much time it took his wife to pay the monthly bills and how repetitive it was. This was the birth of his idea for Quicken, the personal finance software, which grew into a billion dollar company. The practice of observing customer behavior has continued, now alive in Intuit’s “Follow Me Home” research program which is designed to gather what is being called ethnographic customer data. Because of that continued emphasis on understanding customers’ lives, Quicken and other Intuit products are consistently rated at the top of easy-to-use software.
The purpose of ethnography is to generate the kind of deep and intuitive understanding of customer needs and frustrations that cannot help but inspire creative insights. A company will select a few customers or potential customers to observe, typically about 10. (While other VOC methods are concerned with information quantity, ethnography focuses on quality.) A team of trained observers is sent to watch the customers. Their goals are to:
Other than Intuit’s approach, no financial services businesses have made available reports on their use of ethnography, though Bank of America has set up an experimental branch where it can test any number of customer services. But the experience of a retail chain which wanted to improve customer experiences at its stores provides an example that could easily be adapted to banks with branch locations. This case study shows how ethnography complements more traditional forms of VOC.
The retail company team’s goal was to understand how it could redesign its stores to give shoppers a more pleasant experience (one that would correlate into sales, of course). To get started, the team:
The team used this historical data as a starting point. (Many companies will stop here and not go any further, assuming that this data is true and basing all their decisions on it. In fact, such an assumption is seldom true.) Based on what was learned, the team began working on two different fronts:
1. What Other Companies Were Doing (Benchmarking)
2. What Customers Wanted (VOC Collection)
Based on the information collected, the team moved into the next design phase – prototyping. Though often used only for new product development, prototyping is critical for all development efforts. This team took its research and ideas and incorporated them into miniature store layouts and designs. For example, to test a completely new design of the music section, they constructed (in open warehouse space) a scaled version of the new fixtures and layout. Then they brought in customers to test out the shopability of the new design. The feedback was immediately implemented into improving the design and establishing a second prototype, which also was tested. The same process was used for each department until the store design was complete.
A growing body of case studies shows how ethnography leads to insights that companies simply cannot get any other way. A book about this new discipline, The Art of Innovation by Tom Kelley, profiles IDEO, a firm in Palo Alto, California (USA). The firm has used ethnography to design everything from medical equipment to an office furniture showroom.
One downside of ethnography is that it is time- and labor-intensive. Also, a company needs to guard against designing a product or service based on a just a few customers. The experiences of the few people a business chooses to observe in-depth can be a great source of inspiration and provide the starting point for next-generation products and services. But the more traditional forms of VOC – focus groups, phone interviews, etc. – are still needed to validate findings from an ethnographic study.