Uncovering Your Customer's Hidden Needs: Companies Must Go beyond Traditional Market Research Techniques If They Are to Anticipate the Future Requirements of Consumers

Article excerpt

Capturing the 'voice of the customer' is an essential stage of any new product development. However, the way companies 'listen' to their customers is changing as managers realise end users are often unable to articulate their needs and focus groups seldom lead to breakthrough product ideas. The Sony Walkman is an example of a new product that resulted from insights into customers' hidden needs rather than market research. It is not that market research is bad per se, rather it is in need of an overhaul in many organisations.


A vanguard of product developers has addressed the issue of hidden needs--needs which customers themselves do not always recognise--and some companies are using novel ways to capture them. We have assembled a collection of tools and techniques that go deeper than traditional market research. We have called this approach Hidden Needs Analysis (HNA) and its tools include repertory grid analysis, empathic design (including observation and contextual interviews) and lead user groups. Each of these techniques, we believe, has advantages compared with traditional market research tools.

Common problems

The first tool in the traditional market researcher's armoury--the questionnaire--has several drawbacks. Customers and users cannot always adequately express their needs, and direct questions do not help with this problem. We regularly come across questionnaires that are so poorly designed the companies which produce them will not obtain reliable responses. However, the most important issue with questionnaires is the response rate: how many questionnaires do you fill in? Not that many, probably. Yet many companies have yet to realise this approach is becoming obsolete.

The traditional fallback after questionnaires is the focus group, or visits to specific customers or users. Both can generate good ideas but the majority of marketing managers say that they are not exciting and complain that too many of the new products that emerge from them are purely incremental innovations (which cannot be differentiated from the competition). The main limitation of the focus group is that discussions take place outside the normal business environment where there is a host of clues that product designers should be focusing on.

HNA philosophy

The philosophy behind hidden needs analysis is simple: direct questions are ineffective and different approaches are needed. These new approaches are drawn largely from anthropology and psychology, sciences which aim to uncover people's views and beliefs.

For example, repertory grid analysis (RGA) was developed by psychologists to understand how individuals think and to uncover their cognitive 'maps', a technique that is ideal for developing new product ideas. RGA uses indirect questions to allow users to compare their experiences of existing products and services and reveal tacit knowledge. Companies that have used RGA in market research include Beiersdorf (a Hamburg-based manufacturer of global brands such as Nivea) and Hewlett-Packard, both of whom were successful at uncovering hidden needs (see Equant case study below).

Observation is another very effective HNA technique. In recent years several of the leading market research companies have hired anthropologists who observe customers on many levels simultaneously and do not limit themselves to collecting information and ideas through questions. They are able to pick up clues on customers' hidden needs through observing body language, spatial signals and other subtle gestures, all of which are easily missed by amateurs. Technology such as micro video cameras is making observation easier. We are currently working in Germany with one of Robert Bosch's business units which designs and manufactures production line equipment. Through close observation of operators working in their customers' factories, Bosch has gained much deeper insights into product requirements than from interviews with production managers. …