Over the past few years, “behavioral” has been the trending buzz word in the market research world, and not without reason.
Thinkers like Daniel Kahneman and Dan Ariely have highlighted the disconnect between what consumers say or recall and what the reality actually is. We don’t believe any consumers or participants we talk to intentionally lie, but relying on the recall can be pretty inaccurate. For example, asking people, “Do you eat healthily,” yields very different results than, “Take a picture of everything you eat for the next three days.”
What if we could step out of that conundrum altogether, and approach research from a completely different angle? MVP (minimum viable product) learning and Innovation Accounting are two approaches that blow the lid off of more traditional market research thinking.
MVP Learning involves identifying a series of “leap-of-faith” assumptions to test, building one test at a time for a specific assumption, outlining key metrics to track progress and success, then conducting the test. Results are then used to inform the testing of another critical assumption, or a Pivot, Persevere, Perish decision. In contrast to traditional market research approaches, MVP learning hinges on real interaction with a prototype, versus talking about products, services, or ideas in hypotheticals.
Innovation Accounting “is a system for translating from the vague language of “learning” to the hard language of dollars. It puts a price not just on success but also on information,” according to Eric Ries in The Startup Way. It often involves dashboards to track iterative learning over time, using metrics that demonstrate transactional customer data.
These two methods are iterative and transactional, and we believe these approaches to market research will continue to trend in the future. Here are some ways that we’ve applied MVP Learning and Innovation Accounting in our research challenges:
MVP Learning Case Snapshot: To test the critical assumption, consumers prefer a shorter checkout process when purchasing xyz product, we steered away from asking quantitative study participants a hypothetical and asking the question, “Which would you like better: a shorter process or a more detailed process for purchasing xyz product?” Instead, we shared “explainer” videos, a short video that demonstrated the current process and a prototyped new process, then asked, “Which way would you prefer to purchase xyz product? Why?” Within 24 hours of fielding, 150 participants yielded clear input on a Pivot, Persevere, Perish decision.
MVP Learning + Innovation Accounting Dashboard Case Snapshot: To test the critical assumption, consumers are willing to share xyz info if they receive xyz benefit, we didn’t ask, “Are you willing to share xyz info?” Instead, teams framed three real-life scenarios in explainer videos and asked specific questions about what they were willing to do in each scenario, with a check-in on the benefit they believed they would receive. For under $5,000, in less than twenty-four hours the team had robust information to fuel their Pivot, Persevere, Perish decision and further rounds of testing that are tracked over time to allocate metered funding through an internal VC board.
So, while “behavioral” may be the market research trend of 2017 (and for good reason!), MVP learning, Innovation Accounting (or at least research that is iterative, transactional and ongoing) will be the research trend of 2018 and beyond.
Check out The Garage Group’s Research Subject Matter Expert giving a nod to MVP Learning in the 6th episode of Voxpopme’s Perspectives here.
To learn more about Pivot, Persevere, Perish decisions, read this white paper from Harvard Business School, Hypothesis-Driven Entrepreneurship: The Lean Startup (more about these types of decisions on page 10).