I am often asked by companies with whom I work whether focus groups, surveys or customer panels are useful in learning what customers want and more importantly, what they will pay for. Sure, these techniques are helpful and sometimes can lead to useful insights. But it is usually a huge strategic mistake to base investment decisions or innovation projects on data gathered through these means. Why? A benign explanation is that we are all massively unaware of what really does drive our behavior. A less charitable explanation is that when people are asked questions, they tend to respond the way they think the person asking would like them to (which is one reason why doctors always double the number of drinks per day patients report consuming).
This issue came to mind earlier today, when I read that Burger King is phasing out it’s slightly-less-bad-for-you brand of French fries, called “satisfries” leaving the decision of whether to continue to offer them to its franchisees. Here’s the thing – according to the New York Times, a box of satisfries still weighs in (no pun intended) at 270 calories, compared to the regular product which will provide 340 calories. I mean, c’mon, do the math – for 70 calories of difference, why make the sacrifice of ordering something that’s different than your normal preference?
So, what are some better solutions? One is prototyping. Rather than guess how customers will respond to an offer, mock it up and try it out. Another closely related one is experimentation. Of course, you have to test the right hypotheses if your experiment is going to yield real insight. Finally, observation of the customer in the wild, in their natural habitat can be invaluable. Procter & Gamble’s well known “working it” and “living it” programs would be examples. At any rate, the golden rule still applies – don’t listen to what customers tell you, understand how they actually behave.