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Overcoming Confirmation Bias for Natural Products Brands

AIDP

There is a danger in confusing anecdotal data for truth. Many times, I’ve heard people in the natural product industry or in integrative medicine talk about their personal experience as though it’s universal. Decisions are made based on the subjective experience of those who happen to be decision makers, as though that makes them super consumers who represent the behavior of millions. They assume that all humans are rational like they are. They believe that if you prefer A to B, and B to C, then you should prefer A to C.

I recently finished reading The Undoing Project: A Friendship That Changed Our Minds by Michael Lewis, which chronicles the amazing story of psychologists Amos Tversky and Daniel Kahneman (pictured in Tversky’s garden in the late ’70s). It’s a great read, and while it’s about many things, what it does for market researchers is expose human irrationality.

For example, Tversky and Kahneman showed that the above A to C scenario does not always happen in real life. What it proves is that one or two people acting one way does not mean that the majority do the same. Lewis demonstrates throughout the book that there are good reasons to conduct quantitative research.

Heuristics

In The Undoing Project, Lewis explains key heuristics and biases that influence the way we assimilate and translate information. A heuristic is an approach to problem solving, like trial and error. The heuristics that Kahneman and Tversky applied were to show how people make decisions.

One example, the “availability heuristic,” is that when an infrequent event can be brought quickly to mind, people tend to overestimate its likelihood. An example they use is whether there are more English words with k as the first letter or with k as the third letter. Because it’s easier to recall words with k as the first letter, you think that there are more words beginning with k. The truth is otherwise.

Let’s apply that to the natural products industry. Who are typical natural products consumers at your local food co-op or Whole Foods Market? Think about it for a minute. When I ask that question, most people say that natural products consumers are more liberal than not, more alternative in their lifestyle. The availability heuristic is at work here, because they think about the store staff and how they dress and act—they think about the old cliché of the Birkenstock shopper.

However, we’ve conducted many different quantitative studies in which we’ve asked respondents to identify their political leanings. Every time, the data points to 1/3 liberal, 1/3 moderate, and 1/3 conservative. Without this data, I know I would be imagining a liberal, alternative shopper. But now that I know the truth, I see all of the “hidden” markers I did not notice, and it makes perfect sense.

Biases

In terms of biases, one that we deal with every day is “confirmation bias,” where people look for data or instances that confirm their preexisting beliefs. They don’t give (or don’t want to give) thought to other possibilities that might contradict their belief. Anyone who participates in social media experiences this on a daily basis. And I’ll be the first to admit it’s hard being proven wrong.

Let’s look at the specialized world of supplement brands that are sold only through health care practitioner offices. This is a world in which salespeople visit the offices of doctors, chiropractors, acupuncturists, naturopaths and other CAM practitioners. When they succeed in a sale or develop a long-term relationship with a practitioner, they take note of what worked for that practitioner. Other sales follow, and pretty soon they have developed a list of “facts” about what interests or engages practitioners. They hierarchize selling points, and certain “benefits” become part of the “truth.” From this point on they’re relying on confirmation bias.

But what about those who did not respond? Is it just that the competition has a better product? And are the factors that they believe work the best really the most important?

When we’ve conducted market research on integrative doctors and CAM practitioners, we’ve found the answer is yes and no. And this quantitative research helps everyone: salespeople learn how well they’ve listened to their customer base, marketers discover how they can best support their sales team, and executives better understand the relationship between their brand and their market.

What’s important to note is that confirmation bias may in fact turn out to be accurate. But it’s quantitative data that gives you the confidence you need to move forward.

A final thought (Courtesy of The Undoing Project)

A new definition of a nerd: a person who knows his own mind well enough to mistrust it.

The Undoing Project: A Friendship That Changed Our Minds, by Michael Lewis

In other words, when in doubt about a direction your brand should take, get the data. As Kahneman wrote in his best seller Thinking, Fast and Slow, “The confidence we have in our intuitive beliefs and preferences is usually justified. But not always. We are often confident even when we are wrong, and an objective observer is more likely to detect our errors than we are.”

When you have no doubt (and have no data), evaluate your decision through the availability heuristic, and be honest about how much confirmation bias is affecting your decision.

 

Yadim Medore

Yadim Medore is the founder and CEO of Pure Branding, a brand development, research, and marketing agency for leading dietary supplement, functional food and personal care companies. With more than two decades in the natural products industry, Medore is an industry expert who regularly speaks at National Products Expo East and West and Engredea. Learn more about Medore and read his most recent insights at purebranding.com/yadim-medore.