How to Innovate by Observing Customers

You probably think that innovation is something people do in bright conference rooms with flip charts, colored pens, and sticky notes. If your answer is Yes, you are right, that’s how a lot of innovation is done but it’s not the only way it is done. Sometimes the best innovation happens, not when you are in a conference room, but when you are observing customers in the field.

This is because when you are with customers several things happen.  You are watching a real customer in a real environment and you can experience this person’s world first hand.  You are better able to put yourself in the customer’s shoes and understand their needs and frustrations as well as really see the details of their environment—things you could never do in a lab.

To help illustrate this experience, let’s assume you are a product manager who is observing a customer in her home using the Web to shop. You sit next to her while she operates the computer. There is video camera trained on her face, on the computer screen, and on the area around her computer. The two observers in attendance make sure that the cameras are always focused on the right activities so that you can focus on the customer.

You observe that the area around the customer’s computer is cluttered with mail, pamphlets, and magazines and on top of all this stuff is a half empty coffee cup. You observe the sticky notes stuck to the frame of her monitor and the note pad next to her keyboard. You realize that her world is far from the clean and uncluttered environment that you imagined. It is a various and complicated place where every detail is a distraction in the making.

Your company’s product is well known Web site and it doesn’t surprise you when you ask her to go shopping that your site is the first one she goes to. She navigates to a new page, scans the page, then navigates to a different page. She does this several times.

The phone rings, a dog barks, and kids arrive home unexpectedly from school. She stops and restarts her work several times. You realize that your site is not the center of her world as you imagined it or, more importantly, not even for the hour or two that she decides to use it.

She frowns and, before you know it, she has landed on a competitor’s site. This is exactly what you didn’t want to happen. You wanted to observe her using your product —not the competitor’s. Now that she has left your site, you worry about how valuable this interview will be. You want to show her where option x and y are—these are the options that would allow her to continue the task she was doing  and remain on your site, but then you remember that as an observer you can’t tell her how to use the product. She is on her own.

You realize that, unlike you, she hasn’t committed every single feature of this product to memory—every radio button, drop down box, and system state. She doesn’t know that this is your site or how much work went into developing it, the processes with which you are well acquainted, such as product planning, system design, software development, and quality assurance—to name a few. You suspect that if she knew these things, maybe she would have given your site a second chance and, perhaps, remained on it longer.

She picks up her phone and calls her husband. After a moment, you realize she is asking him for advice. She pulls out a consumer research magazine from the pile of stuff on her desk —slightly rocking the coffee cup. She thumbs through several pages and then pauses to read something. You wonder why she leaves the computer when the computer should theoretically provide all the information she needs. It is the Internet, you tell yourself. She continues this process of navigating to a new page, scanning the page, then navigating to a different page.

But then it occurs to you that maybe this offline behavior —using the calculator and calling her husband—- is telling you what the product should be doing. In other words, maybe this behavior could provide clues as to how to design your product better. Perhaps the information that she enters into her calculator and writes on her pad is actually information that the product should be processing. Or, better yet, maybe it is information that doesn’t need to be processed at all. These insights are what is typically referred to as incremental innovation. You are not disrupting or challenging assumptions about the product. You are improving an existing feature so that it provides more value to the customer.

The fact that she telephoned her husband and browsed a consumer research magazine could be telling you something altogether different.  Maybe the product should provide more information, more specifically, information that helps the customer make decisions, sometimes referred to as decision support. Maybe the product should go a step further and actually guide the customer in making these decisions. These improvements may be innovation of the disruptive kind. You are not just improving an existing feature but actually introducing a whole new area of functionality. It challenges assumptions about the product and often means a significant change to the way the product is designed and developed— potentially big stuff.

You glance at the video cameras that are recording the sights and sounds of the interview. You realize that you can review everything that happened that day at a later time and this will allow you to see and hear things that you may have missed. At the end of the interview, you will have the opportunity to interact with the customer. You can ask her to return to pages she had visited and even walk through tasks if necessary. You will also have the opportunity to ask her why she did the things she did.

Even if the customer never returns to your site again, you realize that you learned a lot from the interview even though much of her time was spent observing her using a competitor’s site and doing things that had very little to do with the Internet. The fact that the customer did not succeed doesn’t seem to matter.

You also realize that the experience as simple as this was could help you improve the product and even make big changes. By observing the customer’s paint points and breakdowns with the competitor’s product, you were able to get a sense of what the ideal product might look like. By observing the offline activities (calculator, phone call, etc,) you were able to see beyond your assumptions about the product, detect important patterns in activities that at first might have seemed ordinary or irrelevant, and get a glimpse of a what a big change to the product could mean for the customer.