What is the "Virtual Customer" Initiative?

an interview with:

John hauser
Kirin Professor of Marketing,
MIT Sloan School
of Management

MRT: In a nutshell, what is the Virtual Customer Initiative?

JH: The Virtual Customer Initiative (VCI) is a multidisciplinary research project, underway at MIT, to develop and test new theory and methods for improving the speed, accuracy, and usability of customer input to the product development process.  I will provide an overview of the VCI with an in-depth look at a few of the new methods.

MRT: What benefits can the Virtual Customer offer to product development teams?

JH: Our objectives are to increase the speed and accuracy of customer input and to provide valuable information to product development teams at all stages of the product development cycle.  We are working on identifying the best and most efficient areas for improvement, and developing practical methods for implementing these systems.

MRT: Are these tools available to product developers yet?

JH: Some of these tools are already available (open-source code is available from our website), while others are still in testing.  Many of these initial projects have been successful and a number of consulting firms are beginning to turn these methods into services that are easy to use.

• An on-line ideation tool with a unique scoring system developed at MIT is being used to improve the quality and quantity of creative brainstorming ideas once the set of customer wants and needs has been established.

• The FastPace method for conjoint analysis, which gathers more information with fewer on-line questions, has been applied a number of time and has won a major internal research award.

•  “Listening In,” a method to gather information automatically from on-line virtual advisors has already identified new platform opportunities in the auto industry.

• Gards, a method to identify the features that customers use to screen products for potential consideration, was recently awarded the AMA’s Explor Award for creative contributions in web-based research.

MRT: Will your presentation include concrete suggestions on how to incorporate some of these tools into a company’s ongoing Voice of the Customer activities?

JH: Yes. The VCI methods are designed to help improve creativity and effectiveness in all stages of the product development cycle.  I will review four examples of VCI methods and provide references and an overview of the full suite of methods.

MRT: Are there any other methods of interest to attendees?

JH: Yes, the VCI is exploring a wide variety of challenges.  We have a team working on fun online “games” that provide respondents with the incentives to think hard and tell the truth.  One game “pumps” customer needs from customers as they play a game of questions and answers.  Another method provides a means to ensure truth-telling by asking respondents about themselves and others.  Still another game asks respondents to buy and sell information in auctions that reveal their preferences.

The VCI is doing much more than porting paper-and-pencil methods to the web.  We are using the ability to communicate rapidly and effectively among respondents to develop new forms of data collection and we are using powerful algorithms and computer power to adapt questions and make sense of information in ways that were not possible just a few years ago.

See more about this subject at MIT Sloan's Virtual Customer Website.

About John Hauser
John R. Hauser, is the Kirin Professor of Marketing and leader of the Virtual Customer Initiative at the M.I.T. Sloan School of Management where he teaches new product development, marketing management, competitive marketing strategy, and research methodology.  He is the co-author of two textbooks, “Design and Marketing of New Product”  and “Essentials of New Product Management". He has received both the Converse Award for scientific contributions and the Parlin award for contributions to marketing research.  He has won awards for research and for teaching and his students have won awards for their theses and, later, for research papers.  For six long years he was Editor of Marketing Science.  Outside interests include sailing, swimming, NASCAR, opera, and country music.