Customers aren’t always right. Companies need to listen, observe, and test them
Author: Ashley Brasier
Source: Buisness Insider
- Ashley Braiser is a member of Lightspeed Venture Partner's consumer investing team, where she helps early stage companies with growth strategy. She's a graduate of Stanford GSB, and previously worked for Thumbtack and Bain.
- Before she joined Lightspeed, she worked on user research projects for several startups and brands.
- She notes that while many companies invest in market research, and more than 40% have dedicated teams for user research, there are still many examples of companies not understanding consumers.
- To truly understand a customer, companies need to listen, observe, and product test.
- Visit Business Insider's homepage for more stories.
Most products fail, but not for lack of trying.
Over $45B is spent by companies each year on market research and more than 40% of companies have a dedicated team for user research. Despite this effort, a quick Google search of "product flops" says it all: watermelon-flavored Oreos, purple EZ-Squirt ketchup, and even Google Glass.
So why is it so hard to understand consumers and what they want? Can't we just ask? Well, yes, but asking is only the first step.
Customers are (not) always right. What we, as customers, say we want is often different than what we actually want. Truly understanding customers requires listening, but also careful observation and product testing.
Before joining Lightspeed, I led several user research projects for startups including Thumbtack, BetterUp, Fundbox, and a pre-launch Indian beauty brand. Time and time again, I noticed that customers would say one thing, but mean another. When they said they wanted more choice, they actually meant they wanted fewer, yet more curated choices. When they said they wanted to be inspired, they first wanted to be educated.
Over time, I've curated a set of techniques to help me better understand customers — in aggregate, a way to triangulate what consumers really need. In the same way a founder can triangulate total addressable market or projected growth rate, I believe a founder can also triangulate customer need. Listening, observation, and product testing techniques form the foundation of this approach.
Below I've included some example techniques for each — listen, observe, test. Think of this list as a menu. For any research project, you can select the most appropriate techniques based on what you're trying to learn and level of effort required.
I've also included some real-life anecdotes.
Listening is where most companies start. And it's unfortunately where most end. While listening is a good place to start, it will almost always lead you down the wrong path if you take what the customer says at face value. Instead of just focusing on the 'what,' focus also on the 'why.' Try to understand your customer's motivation and aspiration. Build a hypothesis that can serve as a starting point for further observation and testing.
For the Indian beauty brand, we spent over 30 hours listening to our customers — at the mall, at local Indian stores, and even in their homes. One thing we heard over and over again is that people didn't want turmeric-based products. If we had stopped there, we would've missed a key insight — that the concern was about staining vs. the actual ingredient. By asking 'why' over and over, we realized people actually loved turmeric's anti-inflammatory and acne-fighting properties, they just didn't want any staining. The first product we ever trialed used non-staining turmeric, a key ingredient in Divya's grandmother's recipes. However, because of our extensive customer interviews, we focused a lot more on customer education and messaging than we otherwise would've, given existing misconceptions.
There are several ways to listen to your customer. I prefer to start with the informal, like mall intercepts, to understand who the customer is and what they care about. From there, I develop a longer set of questions for more formal sit-down interviews.
Mall intercepts are bite-size customer interviews. They are helpful when first getting to know your customer. They're also helpful when asking about shopping preferences and routines, given customers are already primed by the environment. You should ask 2-3 precise questions and move-on. Here you're optimizing for volume and breadth vs. depth. Use insights gleaned here to inform a more robust set of questions for longer interviews.
Take your customer (or hypothetical customer) out to coffee for a 30-60 minute chat. Prepare an initial set of interview questions grouped by topic, but use this as a starting point. Know that some of the best information can be gleaned from a customer going "off script." If the topic starts to veer, let that happen and eventually get back on track. Ask why … ask why again … and ask why once more (IDEO's " 5 whys").
I learned a ton about effective customer interviewing in Stanford's Startup Garage class. The Stanford d.school has a concise and effective list of customer interviewing tips here.
"When you meet chimps you meet individual personalities. When a baby chimp looks at you it's just like a human baby. We have a responsibility to them."
— Jane Goodall
Go out into the wild and spend time with your customers. Observe their routine and try it out for yourself. See what it's like to run a small business or be a beauty influencer. In the words of Jane Goodall, see what responsibility you have to them.
When making product updates at Thumbtack, I often met with our service professionals in-person to observe them using the product in-situ. On one afternoon, I drove to San Francisco's Mission District to meet a Thumbtack caterer in her home. She was in the process of prepping for a dinner party that evening. As I observed her messaging with customers, I noticed that she checked her wall calendar several times.
Recognizing the inconvenience, we talked about why she used the wall calendar vs. something like Google Calendar and what she would want to see if Thumbtack were to enable scheduling. The information gleaned from that one afternoon was critical to informing the scheduling features we later built into the product.
There are several different ways to observe, with varying degrees of intrusion. The techniques below have worked well for me in the past.