In a great HBR piece, Christian Madsbjerg and Mikkel B. Rasmussen dissect the way that businesses are applying social sciences in better sensemaking about customer phenomenology: how people experience life. This leaps past big data obsessions over small bore customer behaviors like how many Starbucks coffees they buy, or how many barmaids suggest a specific brand of beer. This article drills into the true challenge confronting enterprises — the growing complexity of their markets, and the difficulties in understanding what is going on, despite increasing amounts of data. As Anne Marie McEwan wrote recently,
In an information-rich world, we need to be able to ask better questions.
One case study in the HBR article is Legos:
Consider how the Lego Group used phenomenology to understand its customers’ deepest motivations. Eight years ago Lego had lost touch with its core customers and was bleeding cash; today it’s one of the largest and most respected toy makers in the world, the result of a remarkable turnaround driven in part by its commitment to sensemaking.
The company’s downward spiral was propelled by its determination to leverage the brand and move into new markets rather than to understand what its customers—young builders and their parents—really wanted from play with its products. Acting on mistaken assumptions, Lego branched into action figures and video games, believing that kids, increasingly scheduled and often distracted by faster-paced electronic games, no longer had the time or patience for its old-fashioned plastic bricks. So Lego products got a lot cooler and more aggressive looking, but they also required less time and creativity from the kids playing with them. Meanwhile, parents’ nostalgia for the old Legos began to dissipate, and with it their impulse to buy the bricks.
CEO Jørgen Vig Knudstorp understood that customers had lost their connection with the brand and that new product lines weren’t the solution. He realized that Lego needed to better understand the phenomenon of play. What is children’s experience when they play, what do they desire from it, and how could Lego serve that need?
To find out, the company embedded researchers with families in the United States and Germany. The researchers spent months collecting data, interviewing parents and children, creating photo and video diaries, shopping with families, and studying toy shops—in short, amassing a vast store of information. As the Lego team methodically sifted through the data, key insights began to emerge. Among them was that children play to escape their overly orchestrated lives and to hone a skill. This insight exposed the false assumption that kids were too busy to engage with Legos. In fact, it emerged, a subset of children have both the time and the desire to commit to the bricks and want to achieve mastery.
As Paal Smith-Meyer, then the head of Lego’s new-business group, explains, “Now we are making products that are proud of being Legos. If you look at a box, you know it’s Lego. You can’t force someone to play with the bricks. The research allowed us to make a decision about whom we wanted to reach. It was a decision that grew into a mantra: We’re going to start making Legos for people who like Legos for what Legos are.”
At the core here, is relearning how to think outside of market dynamics — products, messages, store shelves — and return to the mindset of an anthropologist: what are people actually doing, and why?
The example of BeerCo — an anonymized beer maker in the UK — that could not understand why its products did not fare well in bars is massively illustrative. Using an ethnographic approach, they discovered the following:
- BeerCo’s promotional materials were considered junk by most bar staff, particularly female bar staff.
- They found that female bar staff resented having to be flirtatious, and felt trapped in their jobs.
- The female bar staff were key to sales, but knew little about BeerCo’s products, and were disinclined to learn more.
BeerCo changed it’s marketing totally, focusing on a more customized approach to promotional materials and bar relations. It trained its sales people to understand bars individually, and invented a tool to help bar owners run campaigns. BeerCo created in-workplace ‘academies’ to train waitstaff, and set up a program to pay for taxi rides for servers that worked late.
The company turned its bar sales around, through an ethnological approach. Note that they didn’t have to actually rethink the product — the formulation of the actual beer wasn’t the issue — or its messaging. What they changed was how they actually connected, socially, with the staff in bars, and took steps to actually help the staff change their behaviors, like recommending their products. That led to dramatically increased sales.
It’s also not clear to me that this approach lines up with social media tools. I doubt that the best social media listening tools would have gotten the same degree of deep sociological understanding of the microculture of bar work in the UK.
So, the term ‘social’ needs to be reconsidered and recast in our discussions and thinking, turned back to the more foundational ‘social’ as in social science, not the derivative social media sense of the term.