Schwartz’s book, The Paradox of Choice, has a lot to say about marketing. The book’s premise is that when consumers have too many choices in a category, they tend not to make a choice.
The book cites a simple, but elegant, research project in which consumers were given an opportunity to sample jams.
In the first leg of research, consumers had a choice of six varieties of jam and 30 percent of consumers made a purchase.
In the second leg of research, consumers had a choice of 24 jams and only three percent made a purchase.
This issue appears to be that consumers tend to become overwhelmed with too many choices and do not buy.
The problem of overwhelming choices is vividly illustrated in the movie, Borat. A clip is available at youtube in which Borat walks the length of a grocery store dairy case with a store manager.
The dialog is the repeated question, "what is this?". The consistent reply is "cheese". It illustrates the overwhelming choices in a single food category – cheese.
To us, the larger issue is reasonable choices versus overwhelming choices.
As marketers, the challenge is to create a distinctive array of products with clear positioning and benefits.
How many times each week to we all hear someone refer to a product as simply a "different flavor"?
I was very inspired by the book "Three Cups of Tea" by Greg Mortenson. It details his efforts to build schools in Pakistan and Afghanistan. It is truly amazing what he alone has accomplished.
The title of the book is in reference to the idea that it takes three cups of tea to really get to know someone. "The first time you share tea with someone, you are a stranger. The second time, you are an honored
guest. The third time you become family."
Too often in marketing we don’t take that advice. We want results quickly and cheaply. And, we want our target audience to tell us all their wants and needs before they even know who we are — when we are still a stranger. We need to keep in mind that it takes time and many "touches" to gain someone’s trust — especially if you are launching a new product or targeting a new audience.
The author, Greg Mortenson, will be in Kansas City on March 4.
Kevin Fryer recently loaned me a copy of Ken Fisher’s remarkable book, The Only Three Questions that Count: Investing by Knowing What Others Don’t.
As the title suggests, he makes the case for knowing (and actively searching for) information that no-one else knows. The logic and the detailed examples based on historical data are terrific. This book will radically alter your view of investing.
It was interesting, recently, to find Mr. Fisher’s premise replayed in an on line course from MIT. That course dealt with asymmetric information as applied to business decisions.
In marketing, we invest a lot of time on customer research. But, one seldom sees a research objective that reads, “to learn something about customers that no-one else knows”. But, isn’t that the real objective?
Perhaps one of the most successful companies at levering asymmetric customer data is Procter & Gamble.
There were several case histories within P&G of the power of the annual brand surveys. The process includes an annual round of quantitative and qualitative research for each brand.
As the story is told, during a 1960s California focus group for Tide, environmental concerns about phosphorus in detergent emerged. The company acted on the consumer concern, reformulated the product, re-engineered the plants and stayed ahead of the competitors, the regulators and the nascent environmental movement in the US. In fact, the reformulation of Tide put the company several years ahead.
Finding the asymmetric data on your market could lead to a huge payoff.