Reflection Point: Assumptions and Failures

Assumptions are tricky when it comes to running a business. It’s important to be able to predict the behaviors of your target users, but unless you’re willing to back up your assumptions with real research, they are never valid.

Business Failures

So many businesses in history failed because they refused to listen to the feedback of their target users. Blockbuster, Mervyn’s, and Kmart to name a few. The world is constantly changing and improving based off of user research and innovative technologies, businesses that have been around for years have to keep up or they will fail.

Borders’ Rise and Fall

Borders bookstore had a 40-year history before it went bankrupt. What went wrong? Two things: The business refused to listen to their consumers and the business refused to keep up with the changing market.

• In 1992, Kmart Corp. acquired Borders which was valued at about $190 million at the time.
• In 1994, Borders was the largest retailer in downtown Ann Arbor.
• In 1995, the bookstore goes public on the New York Stock Exchange. Their innovative inventory management system was considered “the envy of the industry.”
• In 1998, Borders launches its’ first online retail presence.
• In August 2001, Borders contracts with Amazon to sell products online — a relationship later blamed for making Borders late to the emerging web retail segment.
• In August 2004, Borders signs a deal with Starbucks Corp. to run Seattle’s Best Coffee cafe operations in its stores.
• In March 2008, Stock closes down 28.5 percent to $5.07 after Borders says it lost $157.4 million in 2007.
• In November 2009, Investors criticize Borders “sluggish approach” to the emerging electronic books market.
• In July 2010, Borders launches e-book store, starts selling e-readers, sets strategy to get 17 percent market share in e-books within a year.
• November 15, 2010: Borders launches redesigned website.
• July 18, 2011: Borders announces plan to liquidate. Some 10,700 people will lose their jobs.

Borders quick fall, was in result of them not quickly adapting to the changing market. They didn’t pay attention to their customers, they didn’t innovate. They assumed that their customers would stay loyal and chose to focus on book prices instead of putting their customers first. The launch of the Kindle, Apple iPod, Netflix, and Amazon all played a role in the failure of this business and all of their sales channels. The company did not act quick enough to online business strategies, and their management failed terribly.

Borders made a major strategic error in 2001, when it handed off its online business to Amazon. When the company relaunched its website in 2008, it was too late to make up for lost revenue.

So how does Borders’ failure tie into User Experience?

In UX, there are mainly 3 types of assumptions:

Problem assumptions: As the term indicates, “problem assumptions” are related to the respective problem you’ve been given. For example, if we consider Borders, a problem assumption would have been that customers are having trouble finding the books they want in stores, and choose online methods instead.While we know, in hindsight, that people were, indeed, having this problem, it would’ve been difficult, however, to know for sure at the time whether this was a real problem without effective user research.

Solution assumptions: These are typically present in briefings when a UX Designer or UX team is tasked with designing a solution that is based on assumptions. For instance, with the Borders example, a solution assumption could be to create an app that shows whether a certain book is in stores, or to purchase the book online through Borders so the company gets the sale.

Implementation assumptions: These are related to the way we are going to create a solution. In the Borders example, they could have been related to assuming people would download the app (maybe a web app could have been considered instead).

Assumptions are always there, even when we are not completely aware of them. It’s important to take them into account in order to make a good product that is going to be relevant to its users and its market.

It’s always important to evaluate assumptions, and prioritize which ones are the riskiest that need validation. For Borders, the company could have prioritized the need for a strong online presence and the need for functional and enjoyable e-readers to compete with Amazon’s growing market.The company could have generated hypotheses and researched their assumptions, which would have made the validation of their assumptions much more actionable.

At the end of the day, all we can do is learn from the failures of past business and choose to understand that the user experience is the most important focus of a product. When we assume, we must hypothesize, and then we must research and ask our users what they need from our product. It is the only way to succeed in this ever-growing market of change.