Observing Needs

Scott Cook is a big fan of observational studies when it comes to consumer behavior. He argues that you can't necessarily go off of what a consumer says in a survey, you have to follow that person home and see exactly how they use your product and what they need from your product (not what they say they need)

When he visited our MBA group earlier this month, he gave the example of Raid bug spray. Raid initially designed their product in a way that even a small amount would kill bugs quickly. But upon doing observational studies, they discovered that a majority of their consumers were spraying way more juice than was necessary to kill the critter. In essence, not only did consumers want to kill the bugs, they wanted the satisfaction of seeing them writhe around and drown in poison. The consumers' psychological need outweighed their functional need.

With this information, Raid decided to dilute their formula, saving the company 15% on cost of materials. With the new formula, the bugs would not die so quickly, and the psychological needs of the consumer could better be met. Within a short period of time, sales increased by 50%.

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