Observing the user in real context, researcher taking a role of an apprentice. The method was originally developed for understanding work practices*. When focus is on UX, the researcher pays attention to the emotional aspects of product use: not only the behavior but also the affective aspects of product use.
* “Contextual Inquiry: Field interviews with customers in their work places while they work, observing and inquiring into the structure of their own work practice.”
Researcher acts as an apprentice: following how the participant uses the evaluated system, and asking why this way of use. To study experience, the apprentice pays special attention to what triggers positive or negative emotions, e.g., how the social context influences the experience.
Get real data in the real context of use.
Get information about the environment.
What is interesting is not what they say but what they do.
User may be disturbed and may not have the same behavior/experience as if he was not observed.
References describing the method
Original version of Contextual Inquiry is presented in the book by Beyer & Holzblatt: Contextual Design – defining customer-centered systems (1998).