Here’s today’s Leo:
“The public does not know what it wants, and there is no sure way of finding out until the idea is exposed under normal conditions of sale. If people could tell you in advance what they want, there would never have been a wheel, a lever, much less an automobile, an airplane, or a TV set.” — Leo Burnett
Could there be a more powerful lesson that is more frequently ignored? People love to think that they can predict the actions of humans with research, but in doing so they are ignoring a basic tenet of marketing, which is that the act of observing and testing customers affects their ability to respond with honesty. It’s particularly true in focus groups as social pressure forces people to respond how they want others to see them, but it’s true for quant studies as well.
For me, the value of focus groups is that it acquaints you with real-world language. One of the luxuries of working at Procter & Gamble is that we had a focus group organized for every Friday, no matter what … plus we ran tons of additional consumer research on every product, ad, and initiative you can imagine. It seemed so commonplace to me at the time, but now I realize how different and special the consumer obsession at P&G was — and how difficult it is to help others understand what it means to really be obsessed.
I’ll always remember with a smile a busy Mom in a focus group on laundry who described that one of her laundry problems was that she would often forget that she had put clothes in the wash, and then she would go back several days later and see her clothes in the washing machine, but now covered in mold. It was a great moment of open honesty about a real-world experience. However, the looks of disgust and disapproval from the others around the table ensured that she didn’t say anything else for the rest of the focus group … and I’ll always wonder what other real-world observations she may have had locked in her brain.
However, to use focus groups … or anything that people say to others … as the basis for business decision making is fraught with danger.
The Doypack was a type of flexible packaging — a pouch with a bottom gusset that allowed it to stand on a shelf — that had proven to be super popular in Germany, where they pay for garbage pick-up by the cubic meter. Germans would refill their detergent and fabric softener bottles with super concentrated versions of the same products from Doypacks. It was great for the environment because it drove a massive reduction in landfill volume because instead of throwing out a large empty bottle, consumers were just throwing out a small rolled up tube. It kept the volume of garbage down, and German consumers loved it because it reduced their curbside costs.
Now, in the late ’80s there was a strong rise in environmentalism in North America. By 1989 everyone was gung-ho on saving the planet, and “Reduce, Re-use, Recycle” had just entered our lexicon. P&G asked Canada to look at bringing the Doypack to North America because it had been such a runaway hit in Germany. At first I was skeptical since I surmised that the success of the Doypack had more to do with the pocketbook (i.e. Germans pay for garbage pick-up by volume) than by any deep-seated love for saving the planet. While this initial instinct was in fact 100% correct, I allowed “research” to override my better judgment, as you’ll see in a second.
So, we gamely started focus group research, and it was amazing. Canadian consumers loved the Doypack. Finally … a way to save the planet was at hand. The enthusiasm was infectious. Then, we did quant research and hooboy — they loved it even more. “Yes, of course I’ll buy refills and dilute them with water from pouches!” “What a great way to preserve the planet and reduce landfill for future generations!” We produced a TV commercial featuring a young kid talking about the future of the planet, describing how reducing solid waste with Doypacks would help preserve the future for his generation. WOW!!! The ad scored off the charts in recall and comprehension testing. We had a giant hit on our hands — the best focus group feedback; quantitative testing scores; and ad testing results in the history of the company!
You can probably predict what happened, based on the number of Doypacks you see on store shelves these days. In the end, we ran into two problems:
- Canadians don’t pay for garbage pick-up by volume, so they don’t really care how much solid waste they generate. Plus, most of it gets shipped to Michigan anyway; and
- “No bottle?” Then it should be a lot cheaper … by dollars. Two problems here — people have an over-inflated sense of what packaging really costs (about $0.05 bottle in reality); and quite frankly refilling old bottles is inconvenient.
There is a parallel to this is physics, which is called the Heisenberg Uncertainty Principle. I actually did my Marketing 401 Term Paper on the application of Quantum Mechanics to Marketing for the late, great Danny Monieson at Queen’s School of Business, so you’d think I would have known better at P&G. Bottom line, when you ask anyone if they want to save the environment, the answer is always “yes!” When it comes time to making a purchase, the answer is always “what do I want?”
Here is a nice, simple explanation of the Heisenberg Uncertainty Principle from HowStuffWorks: Link
One of the biggest problems with quantum experiments is the seemingly unavoidable tendency of humans to influence the situation and velocity of small particles. This happens just by our observing the particles, and it has quantum physicists frustrated. To combat this, physicists have created enormous, elaborate machines like particle accelerators that remove any physical human influence from the process of accelerating a particle’s energy of motion.
Still, the mixed results quantum physicists find when examining the same particle indicate that we just can’t help but affect the behavior of quanta — or quantum particles. Even the light physicists use to help them better see the objects they’re observing can influence the behavior of quanta. Photons, for example — the smallest measure of light, which have no mass or electrical charge — can still bounce a particle around, changing its velocity and speed.
This is called Heisenberg’s Uncertainty Principle. Werner Heisenberg, a German physicist, determined that our observations have an effect on the behavior of quanta. Heisenberg’s Uncertainty Principle sounds difficult to understand — even the name is kind of intimidating. But it’s actually easy to comprehend, and once you do, you’ll understand the fundamental principle of quantum mechanics.
Imagine that you’re blind and over time you’ve developed a technique for determining how far away an object is by throwing a medicine ball at it. If you throw your medicine ball at a nearby stool, the ball will return quickly, and you’ll know that it’s close. If you throw the ball at something across the street from you, it’ll take longer to return, and you’ll know that the object is far away.
The problem is that when you throw a ball — especially a heavy one like a medicine ball — at something like a stool, the ball will knock the stool across the room and may even have enough momentum to bounce back. You can say where the stool was, but not where it is now. What’s more, you could calculate the velocity of the stool after you hit it with the ball, but you have no idea what its velocity was before you hit it.
This is the problem revealed by Heisenberg’s Uncertainty Principle. To know the velocity of a quark we must measure it, and to measure it, we are forced to affect it. The same goes for observing an object’s position. Uncertainty about an object’s position and velocity makes it difficult for a physicist to determine much about the object.
Of course, physicists aren’t exactly throwing medicine balls at quanta to measure them, but even the slightest interference can cause the incredibly small particles to behave differently.
This is why quantum physicists are forced to create thought experiments based on the observations from the real experiments conducted at the quantum level. These thought experiments are meant to prove or disprove interpretations — explanations for the whole of quantum theory.
Modern physics has in fact made the Uncertainty Principle a more subtle concept, nicely summarized on Wikipedia:
The original heuristic argument that such a limit should exist was given by Heisenberg, after whom it is sometimes named the Heisenberg principle. This ascribes the uncertainty in the measurable quantities to the jolt-like disturbance triggered by the act of observation. Though widely repeated in textbooks, this physical argument is now known to be fundamentally misleading. While the act of measurement does lead to uncertainty, the loss of precision is less than that predicted by Heisenberg’s argument; the formal mathematical result remains valid, however.
Historically, the uncertainty principle has been confused with a somewhat similar effect in physics, called the observer effect, which notes that measurements of certain systems cannot be made without affecting the systems. Heisenberg offered such an observer effect at the quantum level as a physical “explanation” of quantum uncertainty. It has since become clear, however, that the uncertainty principle is inherent in the properties of all wave-like systems, and that it arises in quantum mechanics simply due to the matter wave nature of all quantum objects. Thus, the uncertainty principle actually states a fundamental property of quantum systems, and is not a statement about the observational success of current technology. It must be emphasized that measurement does not mean only a process in which a physicist-observer takes part, but rather any interaction between classical and quantum objects regardless of any observer.