Ethnography is an increasingly popular technique in product development which grew out of the field of anthropology. Sometimes it is referred to as observational research, a term which describes the method very well.
Ethnography (from Greek ἔθνος ethnos “folk, people, nation” and γράφω grapho “I write”) is a research method designed to explore cultural phenomena.
The researcher studies beliefs, norms, behaviour of a group or community (society) by immersing himself in the world of the subject he wants to study. It is an in-depth research method which can go on over years.
Why is it so popular?
Many times there is a departure from what people say they do and what people actually do. The only way we would know that is through observation. Asking people about their behaviour is not a very reliable technique. People might deliberately lie or might not even be aware of behaving in a certain way.
Another aspect is that there are many unarticulated needs; needs the customer or user isn´t even aware of having. Again, through observation it is possible to unveil these needs or to discover shortcuts which can be transformed in innovative solutions. The needs, once you point them out often seem very obvious but until then they simply haven’t been consciously articulated. It takes attentive observation to do so.
Ethnography is applied in the first stages of a product development process for exploration.
Ethnographic research is applied mostly to explore concepts for new products, find business opportunities and opportunities for technological development, expose pain points, frustrations, behaviour patterns to create better products.
The Hawthorne Effect
One of the downsides is the so-called Hawthorne effect or observational bias. In a nutshell it is the notion that observation alters behavior. When people know they are part of a study they might behave differently. It is almost impossible to prevent this and a researcher has to simply take it into account.
You might want to have a look at “Ethnography and design: get to know your users real good”.