← The Brainy Business | Understanding the Psychology of Why People Buy | Behavioral Economics
The Brainy Business | Understanding the Psychology of Why People Buy | Behavioral Economics
560. Unpacking the Power of Packaging with Behaviorally
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- [00:01]
Melina Palmer
Have you ever wished you had more influence at work? That people would naturally be more likely to buy in on whatever idea you're selling them, whether they report to you or not? Well, you're in luck. I teach a virtual 10 week class on internal communication and change management through Texas A and M University and it's enrolling now. Get details and enroll at HBL Tamu Edu and click on Certificate program. You get to learn directly from me, including live virtual office hours over zoom with a cohort of interested brainy folks like you from around the world. Again, learn more and enroll in the internal communication and change management course at hbl Tamu. Edu. That's HBL like Human Behavior Lab, dot T A MU like Texas A and M University and click on Certificate program. Your future self will thank you and when you're ready, enjoy the show. Welcome to episode 560 of the Brainy Business Understanding the Psychology of why People Buy. In today's episode, I'm excited to introduce you to Matt Salem, co author of Unpacked Predict Packaging that Sells. Ready?
- [01:24]
Podcast Co-host or Interviewer
Let's get started.
- [01:30]
Podcast Announcer
You are listening to the Brainy Business podcast where we dig into the psychology of why people buy and help you incorporate behavioral economics into your business, making it more brain friendly. Now, here's your host, Melina Palmer.
- [01:45]
Matt Salem
Hello.
- [01:46]
Melina Palmer
Hello everyone. My name is Melina Palmer and I want to welcome you to the Brainy Business Podcast. Today we're talking about packaging and more specifically, how packaging influences pricing, sales and choice. At the moment decisions are made, packaging is one of those things people often believe doesn't affect them very much. They'll say they focus on the product itself, or on the price or on quality, not the box it comes in. And yet, decades of behavioral science research show that packaging plays a critical role in in whether something is noticed, understood and ultimately selected. As organizations look for faster ways to predict what will sell, often using AI driven tools, it becomes especially important to understand what those predictions are built on. Data quality, behavioral relevance, and real shopper behavior make a difference in whether insights are useful or misleading. Today, I'm excited to introduce you to Matt Sam Salem. Matt is an SVP at behaviorally and has spent more than 20 years studying shopper behavior at the point of purchase. He's also the co author of Unpacked, which explores how behavioral science, large scale data and predictive modeling can be used to evaluate and improve packaging performance. As you listen to this episode, I invite you to consider this question. How often are decisions about packaging, pricing or presentation made based on assumptions rather than evidence of how people actually behave and what might be possible if you did the opposite.
- [03:20]
Podcast Co-host or Interviewer
Before we get into the conversation, I.
- [03:22]
Melina Palmer
Want to be sure you know there are links in the show, notes for my top related past episodes and books, ways to get in touch and more. It's all within the app you're listening to and atthe brainy business.com 560now. Let's jump right in. Matt Salem, welcome to the Brainy Business podcast.
- [03:42]
Matt Salem
Melina, thank you so much for having me on. I really appreciate it.
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Podcast Co-host or Interviewer
Yeah, absolutely. It's always fun where you've interviewed me before, but I haven't interviewed you before. And I bet there are many people in the audience that definitely know you.
- [03:54]
Melina Palmer
And the company you work for.
- [03:55]
Podcast Co-host or Interviewer
But for everyone who doesn't yet know you, can you share a little bit.
- [03:59]
Melina Palmer
About yourself, your background and the work that you do?
- [04:02]
Matt Salem
Sure would love to. So it's definitely great to be on with you again. And I would say that I definitely feel it as you felt it. It's weird being on the other side, but it's cool at the same time. With that being said, Matt Salem here from Behaviorally. I am an SBP on the Customer Success team. I've been with Behaviorally for well over 20 years. At this point, Behaviorally is the industry leader when it comes to helping clients understand the impact of shopper merchandising and packaging at the point of purchase, whether that be in store or digital. And we also help our clients understand path to purchase as well. So those are the three key areas that we play in.
- [04:43]
Podcast Co-host or Interviewer
Perfect. And I of course know at least you know, more than the average person why packaging matters. But for people who are still a little bit skeptical, I know you know packaging, I almost said it's gotten a bad rap over the years, which is just the worst of puns. But I feel good about it, so I'm going to stick with it. That it's like it's just the box. It doesn't matter, it's just the box. Help prove that wrong.
- [05:08]
Matt Salem
Sure, sure. Well, I mean that is something that comes across sometimes. Hey, it's just protecting the product inside. All I really care about is what's inside. And that always reminds me when I hear that a funny story if I may, but when I first started, and this goes back to the very beginning of my research career, I sat in the back of qualitative research and a shopper made a comment along the lines of, oh, well, I don't really care about the packaging, I just buy it because of what's inside. And my heart sank and I was like, wow, this is terrible. I can't believe that this person just said that. But we all know that that's not really what happens during the shopping experience. And the packaging is in fact, critical to the shopping experience. And one of the many reasons why it's critical is because it's that. That less defense for sale for the product inside. So it really is the silent salesperson, as they say at the shelf. Again, whether that's in your grocery store, in a big box store, mass merchandising online, it really does speak and tell a story to the shopper. And it explains why that product inside is the best product for them. So it's critical as a marketing tool for any business that has packaging at the point of sale.
- [06:26]
Podcast Co-host or Interviewer
Right. And even where people may consciously think that it doesn't impact them, it's the same thing I always sort of joke in talks, you know, where it's like that person who says, like, oh, I never pay attention to those online ads. They don't have any impact on me. It's like, yes, they do.
- [06:42]
Matt Salem
Right? They do. Seriously?
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Podcast Co-host or Interviewer
Yeah. They are influencing you. There's plenty of research to show it. So while that person said this, it didn't derail your, you know, career choice. You didn't bail. Right. So what are some things that you can share where packaging has been impactful? Like, what are things to be looking out for? And of course, it can be something from the book, but, you know, just even things earlier on that are. I always like the example of. So with toothpaste, there was, and I'm now forgetting which brand, but whichever one came out with the really sparkly, like, first, like, kind of metallic box, and their sales go up because you notice the box even though it was the same stuff. Right. That's one that I use as an example, too. And then if everyone has metallic boxes, it doesn't stand out anymore, so it doesn't have the same impact. So you have to think about context and all these things. But you can speak about all this much better than me.
- [07:43]
Matt Salem
Yeah, no, sure. But you're absolutely right on point. And I think the one word that I would use to describe that dynamic is contrast. And when you can provide contrast in the aisle, that's really what's going to help you in terms of standing out first and foremost and being seen. And, you know, you brought up the book quickly. And I was very fortunate to co author, along with Alex Hunt, unpacked predict packaging that sells, which launched this year in July. And in that book we go through what some of the best practices are in terms of design and how to achieve contrast. And the book is so much more than that. I know we'll talk through that as we talk today, but one of the core tenets of the book is, well, what makes great packaging design and contrast and how do you drive contrast in the aisle? And there's a variety of different tactics that can be used to drive contrast. We think about them through a framework that we've developed here called the 4S framework, which is also rooted in behavioral science principles. With that framework, one of the key pieces is being seen and first and foremost driving that contrast just to get noticed. But beyond that, there's so much more. It's not just being noticed for the sake of being noticed. It's being noticed in a way that's salient, so that shoppers remember you, so that shoppers recognize you. And then going beyond that, really communicating in a way that drives purchase when it comes to putting the pack in the cart, whether again, it's literally that grocery cart or just clicking that button and going to cart and checking out.
- [09:11]
Podcast Co-host or Interviewer
Absolutely. And so, I mean, great opportunity to, you know, share more about what are the four S's. Right. So we got B, C seen. And while you did say salient, that's not one of the actual S's. Exactly right. So we have one.
- [09:27]
Matt Salem
We have one. So the 4S framework in and of itself is be seen, shoppable, seductive and selected. And that framework starts with what we have just talked about being seen. But beyond that, we also need to make sure that we can be differentiated within the choice architecture, that is the shelf set that shoppers are shopping from. So we have to facilitate that experience by differentiating from competition. First and foremost, this is our brand, this is what our brand stands for. And then within the brand, these are the variants that we offer, and these are the differences between the different options you have available in the shelf context. From there and from being shoppable, it's then about seducing and being seductive, which is that third square. That third S. The way I like to look at it is through two different lenses, one very quickly reassuring shoppers that costs of entry are being addressed. So an example I always like to give, and many have probably heard it from me over the course of conversation in my career. If you're in the frozen pizza aisle, you must have some sort of delicious looking, hot, cheesy pull coming out on your box. And the reason why is because you Want to give the shopper that emotional feel of it's going to taste great. I could picture pulling the cheese. I could picture it being a hot pizza, despite the fact that I'm shopping in a cold frozen door aisle. Right. So that's part of it, like addressing those costs of entry. But then there's also the point of difference idea, which is, okay, yes, you're going to be a great tasty pizza, but why are you different than the next piece box? That's showing me a great tasty pizza. And that could be a variety of reasons. It could be that you're organic. It could be that your top toppings are as close as you could get from farm to table. It could be that you have a cauliflower crust, whatever that point of difference may be. You want to communicate that point of difference, that it's okay, I get it. You address what I need and, and you have something different that makes me want to try you. And then once you seduce the shopper, that last S is being selected. And frankly, that's more of a culmination of the first three S's that we talked about, right? You're, you're taking it off the shelf, you're putting it in your cart. And those first three S's, depending upon the category you're in, and I would say more over the size of your brand, how much you have to impact each S can vary. So interestingly, if you're a very big brand, for example, being seen, it's important, but it's likely if you have, let's just say, a 50% share of shelf in the category, literally the shelf space, think like a Tide detergent or Coca Cola and Pepsi, right? You're gonna be seen. So to increase visibility might not be as important to you as the newcomer who has too little facings. How do you get seen? How do you break through? So that's just an idea of how brand size can impact how much you need to kind of pull those levers in terms of being seen, shot the bone seductive in order to get selected.
- [12:32]
Podcast Co-host or Interviewer
Definitely. Well, let's just walk through these as kind of like case studies, right? So we'll, we'll start by saying I'm going to have you go both directions. So you can either be the, the Coke or the, I don't know what, original Olipop or whatever when they're first coming out or something, right? Or, you know, you can pick a different, you know, Tide and random competitor that we don't know the name of or whatnot. You Know what advice? So if the big one comes, what are you maybe going to focus on? What are some questions you might ask? What should someone be thinking about if that's them that's listening? And then also for the. For the newbie, you know, what do we look at for these? These four S's?
- [13:13]
Matt Salem
Yeah, sure. So for. For the bigger brands, typically it's going to be more so a focus on protecting the visual equities that resonate quickly with consumers. So that doesn't mean you can't change. It just means you have to establish guardrails to change. So these bigger brands are coming in. They exist. They want to redesign for whatever the reason may be. And we want to make sure that they're not going to do so in a way that causes confusion at the shelf, or let's even say hesitation at the shelf. That question mark that when shoppers go to the category, they notice something's different. They don't quite notice what it is, and it causes problems. Pause. And it almost makes them reevaluate, which is now giving them a chance to leave and go elsewhere. Right. Shoppers are very habitual. They're coming into the aisle and wanting to get out quickly. They're on autopilot for a lot of purchases. Right. So for those larger brands, it's almost keeping them on autopilot. But let's say you're extending and you're adding new SKUs to your brand. Well, you want to make sure that the equities that you're leveraging from a visual standpoint to communicate, hey, it's me over here. Are still there, but you're also doing so in a way that there's that other piece of the pack that's informing the shopper. But there's something else to this now. There's something new going on. Let me investigate and find it out. On the other end of the spectrum, when we talk about the new brands that are trying to break through in the aisle, that visibility is just absolutely critical, because if you're not seen, you're not sold. It's a mantra we've had here for years. You need to be seen first and foremost. And when you're seen, you need to then communicate very quickly, particularly that point of difference, because you want to establish what makes you unique and why you should be tried. So when you think about a newcomer in the aisle, it's really going to be about getting seen and communicating very quickly. And that doesn't necessarily mean with words. It could be with visuals. Right, Visuals. We know Speak much more quickly. The old adage, a picture's worth a thousand words. It's true. So we want to make sure that you're communicating very quickly in the aisle, getting your point of difference across and driving trials. So we'll focus a lot on pushing visibility for those newer brands, as an example.
- [15:28]
Podcast Co-host or Interviewer
Definitely. And you have to just go walk a lot of aisles. Right. Do you spend a lot of time just walking through stores? Is that part of.
- [15:36]
Matt Salem
So I would say on the shopping trips where I have my children with me, it's a bit more, let's go and let's get out. Because the reality is they can easily get distracted. So there's some advantages to getting distracted at times. Maybe they point something out that I would not have noticed, but most of the time with them, it's. It's a quicker shopping experience, I would say, because, you know, my. My. My rational side prevails. But with that, particularly when I'm alone and I'm just shopping on my own, that's when I actually tend to explore and investigate a little bit more and find myself maybe getting lost in the aisle, if you will, for a little while. Highly dependent on if the children are with me or not.
- [16:15]
Melina Palmer
Yeah.
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Podcast Co-host or Interviewer
But, you know, having the kids with you is more like what many of us are experiencing when we go shopping. Right. So what actually stands out through the distraction and kids wanting samples of things and every toy that they happen to see.
- [16:29]
Matt Salem
Right, Right. Like, stay away from aisle seven. In my store, that's where the toys are. Like, try to shop that one. On the times the children are not with me. I'm well aware of the toy struggle that happened in the aisle, for sure.
- [16:41]
Podcast Co-host or Interviewer
Yes. Yeah. It's funny, when you were just talking about the. The packaging that kind of makes you stop and go, what? Like, what is this? Like, that's so strange? Just yesterday, my husband and I were in Costco, and they have a package, and it's, you know, because it's Costco, it's like 16 of them in a box that you get.
- [17:03]
Matt Salem
But.
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Podcast Co-host or Interviewer
But they're so. It's hash browns, but they're in, like, a milk carton that looks like it has some version of a pour spout like, that you would open up at the top. And, like, I understand conceptually why they would be square for packaging. Because you can stack. But why. Why the milk carton pointy top? Because that doesn't keep with it, and you can't unwrap. I can't imagine I'm pouring out, you know, frozen or Unfrozen hash browns out of paper container. Like it's the weirdest packaging and we didn't have the time in this way to stop and go, what? Why would this be this way? But that was when I wasn't in the market for hash browns anyway.
- [17:42]
Melina Palmer
But.
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Matt Salem
Well, it got your attention at least.
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Podcast Co-host or Interviewer
I guess it must be a Kirkland brand anyway. But it's. I know I had said like this.
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Matt Salem
Is not a tater tot because I can almost picture pouring tater tots out.
- [17:54]
Podcast Co-host or Interviewer
Of a milk carton which actually like the packaging of tater tots is terrible. No, it's like shredded long pieces of potato in like the old school like paper milk carton that you open and it makes a weird sort of a spout versus like a poor thing.
- [18:12]
Melina Palmer
Oh, I see.
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Podcast Co-host or Interviewer
No, it makes no sense. But we'll have to go back and investigate now. And for, for anyone from Costco or whoever makes these that's listening, please let us know what's going on.
- [18:23]
Matt Salem
Packaging I'd like to hear.
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Podcast Co-host or Interviewer
So fascinating.
- [18:26]
Matt Salem
Yeah, I'm gonna have to check that out.
- [18:28]
Podcast Co-host or Interviewer
Yep, go, go, go check it out. We'll talk about it in a follow up conversation about interesting packaging as we go from there. So you definitely have. I know from the years that you specifically and then just across behaviorally you have lots of clients and interesting work that you've done. Um, what case studies can you share or something where it was a, you know, big win or a big oops of something that maybe before someone came to you. They're interesting examples throughout the book, you know, what would you share? As people are trying to understand still.
- [19:03]
Melina Palmer
Like we know a little bit about.
- [19:04]
Podcast Co-host or Interviewer
The packaging, but I don't know for people who aren't fully sold of what the packaging is doing, what can you tell? Tell them.
- [19:11]
Matt Salem
Sure. Yeah. I do have a favorite case study from the book for a variety of reasons. One is, and I know we'll talk a bit more about, you know, kind of the landscape today in research and the impact of AI and research. And a lot of the unpacked book is really focused on leveraging AI in order to unlock the power of data intelligence. In short, with that being said at Behaviorally, we've developed something called the PAC Power Score which leverages AI. And the example that I'm going to give happens to be one of the highest PAC Power scores that we've seen for packaging. But that's not really, really why it's my favorite. Although it's a reason why. The real reason why is because I am an avid whiskey drinker and it's about Gentleman Jack. And there's a great case study in there for Gentleman Jack where originally when it came out, the packaging that it was in, while unique from what many people can see in their mind's eye. Jack Daniels old number seven, which is a classic example of world renowned packaging, I mean, that bottle truly is world renowned. It was differentiated, but not as differentiated as it ultimately became. So it did come across differently certainly when they were side by side with one another. But one of the drawbacks of the original Gentleman Jack pack was that it did not live up to the promise of the liquid inside, meaning an elevated experience, a premium liquid inside. So the packaging was revamped and it was revamped in a way where they completely changed the structure. They added certain assets to pack, like the use of metallics, the use of an embossed signature to really dial up that premium notion. And with that, they increased sales by a staggering 40%. And it's attributed to that packaging change. Now what's very interesting about that, and for any non believers out there, as you put it, the liquid inside did not change when Gentleman Jack launched originally to when it had its packaging redesign, it was the same exact liquid inside. And I think alcohol and spirits in particular, but even wine or other areas within ALC Bev are great examples of that. Because I am rather certain that if I took, let's say tequila brand A, which is a more mainstream, lower price point tequila, and put it into packaging of tequila brand B, which is a more premium, non mainstream, well known brand's packaging, that people's perceptions of that liquid may change just because I poured one liquid into the packaging of another. Now maybe not for tequila aficionados that could taste the difference, granted, but I'm sure for a lot of people who just may order a shot of tequila or drink it a bit more casually, they would rate that same liquid differently depending upon the packaging. So it really does work together and in harmony. And it really can help to elevate not only people's perceptions of the product inside without tasting it, but perhaps even after when they do taste it. So the packaging is just absolutely critical in that example. But that same impact happens across other categories. It's setting expectations of what's inside. It's, it's a part of the overall experience. And we often refer to packaging as the, the wardrobe choice, if you will, of the brand that represents the product. And if I come to you wearing, you know, what I'm wearing today for speaking with you versus coming with a backwards hat on and in some clothes from the gym. You might have a different perception when I first see you. Right. So it's that idea of how it could really change and have an impact.
- [22:50]
Podcast Co-host or Interviewer
And like you said, the metallic and the signature and helping to make it so that I instantly see this and think, oh, that's premium, right. That that's something that you're able to see. And, you know, I always. I really loved our mutual friend Roger Dooley, like, when I got his book Friction, and I know, I had asked him about it, that the COVID of the book is very rough in the feeling of it. Right. Whereas most books are smooth and kind of shiny, you know? And when you have a book called Friction, having a rough texture on the COVID of the book is important in being able to imply that. And that's even. Like, I've talked with people about, like, with your business cards, like, mine are very, like, they're smooth. They do have actually a metallic emboss. I have gold foil that's printed on them. And it's where people go, whoa, right. You're going to remember that card.
- [23:45]
Melina Palmer
Right.
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Podcast Co-host or Interviewer
And I've had with people where it's like, if it is soft or smooth on there, to be able to say, like, oh, yeah, that just shows how easy it is to do business with me. Right. Or something that you could just say as a little joke, but they're going to remember because touch has so much to do with the way that we remember things. Do I want to pick that thing up or not? And it's. I always love the example, too. Like, there's no reason why blankets need to be packaged where there's a hole so you can feel a soft, fuzzy blanket or that kids can reach in and actually press the. The play button. Not to make the noise on the toy or to move the thing inside of the package, other than, like, there's not a functional reason why it's actually probably worse for moving the things around, but for the sake of getting people to buy the thing and experience it and, like, see with our eyes and, you know, with our hands in. In those cases. Right.
- [24:34]
Matt Salem
For sure. The sensory experience, as much as you could tap into the senses and then thus tap into the emotions to a degree, it's only going to help. Absolutely agree.
- [24:43]
Podcast Co-host or Interviewer
Yeah, definitely. Well, you did mention a little bit about what you all have been doing with AI can you go ahead and just, I guess, elaborate more where it's not just AI for the sake of AI, Right. But what makes your experience Different.
- [24:58]
Matt Salem
Absolutely, absolutely. So when we talk about behavioral science principles, in part earlier and thinking about the 4S model, right. And how that model is directly linked behavioral science principles, that really is the first pillar of four pillars that we speak about in the book in terms of developing an engine for predicting packaging. So that behavioral science piece is really critical because ultimately we've learned over the years that observing behavior and looking at what shoppers do is going to be very important as compared to what they say. It's not that we don't listen to what they say, it's not that we ignore what they say. We certainly use that information that they give us as well. But observation is really the most powerful piece. The metrics that we see as most indicative of what happens in the real world in our research are those that are tied to observation, meaning visibility, do they see it? Findability, if we give them task, find this pack, can they find it? And then ultimately do they buy it and put it in their cart? And the other metrics are certainly valuable in terms of providing diagnostic information and kind of the whys behind the buy, if you will. But observation trumps them all. So that first pillar is, is a key piece. From there, what we've done is we've productized those behavioral science principles. That means that we're executing our research in a very systematic, consistent way so that we collect every single metric that we know leads to transactions through five plus decades of business and building a database. We are always collecting them in every area of the world where we conduct research in the same way each time. And by doing that, you can build that aforementioned database. And that's that third pillar that we discussed in the the book, which is having a huge database of, for us, behaviors related to different types of packaging introduced to shoppers. Now, importantly, in a quick side note, this engine that we're talking about in the book, we look at it through the lens of packaging, of course, as packaging experts, but we truly feel it's applicable to other areas of the marketing mix, which is one of the reasons why we put the book together, because we want everyone to see this as a way of working, working now and into the future. So you have your behavioral science techniques that are productized, which lends to the building of a database. And then you can take AI and unlock the power of that database in ways that you wouldn't be able to without AI. And the way that we're using AI is to create predictive models. So we're taking both the ability of AI to crunch through extremely Vast amounts of data quickly and identify patterns as one part of the solution. But also, and as if not more important, computer vision, AI Computer vision is breaking designs down into data. So when I take the individual packaging that's placed on shelf that shoppers are exposed to, computer vision can break each one of those packs and its design down into data. It understands the shapes, the colors, the brand marks, the visuals, the proximity of these elements to one another on the packaging, the relative size of these elements versus one another on the packaging, the relative size of them versus the pack, real estate itself. And in doing so, and in creating that data set of design, you now have two different data sets. You have the behavioral data that you've collected and you have the design assets data. And AI can look at those concurrently and start to identify patterns that exist between the visual assets and their treatment and the behaviors that have been recorded when they're exposed. And with that, you could train a model to then make predictions. Once you have a model trained, you could start to upload designs. Computer vision will look at the design, break it down into data, and it'll essentially say, what do I expect or predict for this packaging based upon all I've been trained on, all of the other design data and the behaviors that exist when that design is exposed to shoppers. So it's super cool, cutting edge. And that's how we're predicting packaging that sells using this technique and these four pillars at the core of the products that we're developing.
- [29:26]
Podcast Co-host or Interviewer
And so essentially kind of the goal there being. Right. So like with the Gentleman Jack, right. If that had come out and you put it through and go, hey, this is not standing out, our score is very low. So let's try to mock up something before we actually go produce a bottle and put it on a bunch of shelves. We can put it in this kind of virtual space that goes into where the AI is able to analyze it and say we made, like in this version, we'll make the logo bigger. In this case, we'll add in some metallics or put a signature or make it bigger, black instead of whatever else. Right. So that it's going to try to stand out, get that optimized product and then you do more in person type of test and rollout.
- [30:08]
Matt Salem
Sure. Yeah. Then we would test more. So still in a digital way with online testing, but with consumers, real people. Absolutely. And that's typically going to be the final step. I think, you know, the game changer here is the ability to test, learn, and then have this continual cycle of create and iterate earlier on in the process is going to with certainty lead to better design at the end point. Because the reason we have this to begin with is many years ago when we first started developing the tool called Pack AI, which now lives on the platform called My Behaviorally, which is a self serve platform where clients can literally log in and drag drop a design and get the predictions. It's so cool to see where we've came over the course of, you know, just the, you know, the time that I've been here. Right. But, but with, with the platform and with Pack AI, the reason Pack AI came into existence is because clients were telling us, you know, it'd be great if earlier on, I know if I cut the wrong designs out of the mix I have, before I come to you guys, behaviorally I have 20, 30 designs sometimes. And yeah, there's a lot of smart people in the room making these decisions, but frankly we're just making them on our own. We don't have any data to help back these decisions. So is there a way that you could help us make these decisions? And that's how this tool came to be. And leveraging that database and being able to unlock its power with AI was just absolutely perfect to satisfy the need earlier on in the design process to create iterate test and more.
- [31:49]
Melina Palmer
Mm.
- [31:49]
Podcast Co-host or Interviewer
And that's where I mean, potentially in that process, you know, we've all been in those rooms, right, where it's someone who says, well, I don't like that shade of purple. Like personally I dislike purple. And so no one else could possibly like it. So it's out obviously. Right. But it's like, well, we picked purple because there's not a lot of purple in the soda aisle. Right. And we, and it's not a grape purple because we're not a grape drink or whatever else. Right. But like we picked this intentionally in a bold color, but someone's like, oh no, I prefer pastels. And so it's just out.
- [32:22]
Matt Salem
That's right. That's right. And, and sadly I would say sometimes that even happens after a ton of great work is done and you're closer to the end point. Sometimes, you know, the, the human element comes into play for better or worse, I would say. But. But yeah, particularly early on. You're absolutely right. I mean those biases can come into play. Those personal biases can come into play play. And are you eliminating something based on personal bias? And maybe it's, you know, kind of the social norm in the room, if you will, where other people share that bias with you and it's confirmation bias if you will. And what happens is everybody's nodding ahead. Yep, that one's gone. Meanwhile, in the aisle and with the masses, it could have worked. So yeah, like did it need to hit the cutting room floor or could it have been in the mix and, and could we have continued, continue to try to prove it out as a viable design for the marketplace?
- [33:12]
Podcast Co-host or Interviewer
Yeah, definitely. Well, and I mean we know too is so often you're not the ideal buyer of whatever it is that you're producing. Especially when you're up in, you know, C suite land of working on this and if you're not even in the aisle like doing your own shopping or whatever it is, or it's not a product that is meant for you. Right. So you know, as you know, 50 something, 40 something, or you're creating something that's for, you know, like that's a drink that's targeted as 18 year old gamers. Right. Like you're just not gonna know that.
- [33:47]
Matt Salem
Right.
- [33:48]
Podcast Co-host or Interviewer
Even if you have them in your house.
- [33:50]
Melina Palmer
Right.
- [33:50]
Podcast Co-host or Interviewer
As like your kids, you think you know, but you don't. Right.
- [33:55]
Matt Salem
You better talk to the people in the aisle for sure.
- [33:57]
Podcast Co-host or Interviewer
Right. And not just having to ask one or two people like, well what do you think about this random person in the aisle? You know, but that the having that so much more data than we could possibly really imagine based on what you're able to do with you said AI and decades of that actual what happened research, not just like we think this should happen, but like what really has happened. To be able to have that predictive aspect for people is really cool.
- [34:29]
Matt Salem
And I, and I think that's you just hit on a critical component because you know, perhaps more important than the tech and the AI is what it's built on. And we have that world's largest packaging database and it's built on real shopper data. So the modeling that we're doing for earlier is predictive modeling and it's leveraging primary shopper data. This isn't secondary data that we're scouring for. We're not quite sure how it was collected. We're personally collecting all of this data even in cases where we're building custom models that don't leverage the database in the same exact way because we're adding additional data to customize it for clients. Again, that's us collecting the data. So it's primary data, it's predictive, it's not secondary, it's not generative AI creating data sets that didn't exist from other types of data, it could find out in the wild. This is something that's really within our control. And it's not to say that secondary data doesn't contribute or can't contribute, and it's not to say that generative AI doesn't have a place, but it is to say that the data set that you're leveraging is absolutely a critical component as much so, if not more than the AI itself. And that's one thing when clients ask like, hey, well, what should I be thinking about when using AI? My typical answer is think about what it's built on.
- [35:50]
Podcast Co-host or Interviewer
Yeah, yeah, do you want to expand on that at all? Like, think about what it's built on and like, okay, I thought about it and I don't know.
- [35:59]
Matt Salem
Well, what I really mean by that and in our case in particular is the data set itself, right? So if I expand upon that, if you think about the 4S framework that we talked about, beyond that and what makes it a data set that's very Valuable are the KPIs that are linked to it in our case. So not only is there a solid framework in place in terms of the four S's being behavioral science based, what they represent, but the KPIs that feed in, we know after collecting this data for decades that these are the ones that lead to transactions. So when you think about 20 plus data points that really ladder up to these four S's, this is what the AI is leveraging to make its predictions. And since we've seen time and again that these are the metrics that lead to success in the marketplace, and we validated that by linking it to actual sales data in the modeling itself, it all comes together as being that, hey, it's built on something solid, right? The AI is leveraging a solid set of data and has the data intelligence to work with to make accurate predictions because it could train models, it can look at the ground truth, which is the sales data, link it all together and say we know these KPIs do well when we see these executions and thus we expect this design to perform well. Or hey, you better optimize to address being seen, whatever the case may be.
- [37:25]
Podcast Co-host or Interviewer
And I mean, it's not to say even like to your point here, that the existing data set, like it could be a really great piece of academic research or a really useful or thoughtful book that was put together, but in a totally different context, or that is on a very small sample size and probably, you know, at some point, like every academic paper at the end it says, like, opportunities for future research. Because we looked at this one little thing, and I will say about AI, at least right now, it does like to, to make generalized sweeping notions about how useful something is that it finds and isn't necessarily dotting all those eyes and crossing all those T's.
- [38:10]
Matt Salem
Yeah, sure. I mean, I think certainly with generative AI, I mean, you could see right. When you use, and everybody uses ChatGPT, it says that the answer might not be true. Right. There's like a disclaimer there essentially saying that. Right. I think with predictive AI, the thing that you can do and what we do here is there's metrics that you can look at to kind of prove out the models and how predictive they are. So we focus on something called nmae, which helps us understand, when you look across models, the rate of error that you would get when comparing predictions to actual responses. And what we do is target a 90% accuracy rate, meaning that there would be 10% chance of differentiation or we look at the prediction versus the actual like a 10% margin, if you will. So 90% is a pretty good accuracy level with that. Yes. I mean, acknowledging it's AI, it's not perfect. One day will it be? Perhaps. We'll have to think about what that day looks like in a number of ways, not just for packaging and research. But with that being said, you know, we do feel very confident in the engine that we have in place.
- [39:17]
Podcast Co-host or Interviewer
Definitely. Well, and then I think just for people, as they consider, you know, it's not like you just load your potential packaging up into, as you said, chatgpt and say, is this good?
- [39:28]
Matt Salem
Right.
- [39:30]
Podcast Co-host or Interviewer
Like, one we have to think about the questions we ask. Like, good in terms of what, what are you trying to accomplish? Right. Like, and as you're saying, having your model of, like, would it be noticed? Like, are people going to see it in the context of the shelf of where it's going to be or not, and like, where I'm walking and like, is it. And it does feel a little bit weird to put up a picture of a box and say, is this seductive enough to ask ChatGPT? It might get confused.
- [39:58]
Matt Salem
Exactly. Right. Well, and I love, I love your point. I'm like, what are you asking it exactly? Like, you prompt with minimal information and you could get responses that vary widely. Right. Like, what is good, good in terms of it's going to be good when I actually take it out and use it, it's to be a, you know, the food's going to taste good or good for you nutritionally or whatever you upload. It's a pretty broad question. Right. So you're absolutely right. It has to be better prompted and frankly better informed too. I think that's the combination that you need.
- [40:31]
Podcast Co-host or Interviewer
Yeah, definitely. Well, thanks so much for coming onto the show to chat about packaging. I know that we find this super fascinating. I know there are people listening who work in packaging who are very excited to have had heard this conversation and, and those who don't hopefully are a little bit enlightened about different pieces that go into packaging and maybe they'll be a little bit more attentive as they, they look out when they're on those aisles and things for everyone who's now so excited to get their copy of unpacked and to to learn more and to follow you and, and Paperly and Alex and everything, you know, where should they go? What's their best path to do so.
- [41:11]
Matt Salem
Yeah, sure. Well, certainly you could go right on Amazon for the book itself. So if you go to Amazon and just put in the search bar unpacked, predict packaging that sells, it'll come right up. You can get a digital copy. You could get an audio book. You can get actual if you want to pick up a book and flip through the pages, book of course. And you can also go on Behaviorally's website, www. Behaviorly.com and there's not just a link to the book there, but there is a wide amount of information on packaging, including white papers, articles, webinars, the whole kit and caboodle as they say. So there's plenty of information up there on the website and yeah, check it out. And I would say, you know, with the book itself, if anybody would like to pick it up, we hope that you would find of course an understanding of why packaging is important and critical. But moreover that the engine that we're suggesting can be leveraged in different ways and the principles that we have in place can really help businesses succeed in terms of making predictions utilizing a proprietary large database.
- [42:18]
Melina Palmer
Awesome.
- [42:19]
Podcast Co-host or Interviewer
Well, thank you again so much for coming on and sharing about this and for those links, we'll of course put links in the show notes to make it easy for everyone to find you and connect and get the book. So yeah, Matt, thanks again and looking forward to the next time we get to chat.
- [42:35]
Matt Salem
Thanks so much for having me on Melina. Really appreciate it.
- [42:38]
Melina Palmer
Thank you again to Matt Salem for joining me on the show today. What got your brain buzzing in today's conversation? For me, one of the top things for everyone to remember is that whether we're talking about packaging, pricing, or broader customer experience decisions, the value of any model depends on how closely it reflects real human behavior. This is something I talk about a lot, including in my book what your customer wants and can't tell you, and.
- [43:04]
Podcast Co-host or Interviewer
Also in the Truth about Pricing.
- [43:06]
Melina Palmer
Observation, context and behavior at the moment of choice consistently tell us more than stated preferences or opinions. And packaging is a clear example of this. It's rarely neutral, no matter what people say or want to think. It shapes expectations, attention, perceived value, and impacts whether or not people buy and how much they end up actually paying. So whether you're selling physical products or services, it's really important for you to ask whether or not your packaging lines up with the expectations you want people to have for your business. Are you making it cognitively easier for people to choose you, or inadvertently making it more difficult by misaligning the story of what your brand is about and how it's going to help that person in the decision they are trying to make and that problem that they're trying to solve? Solve? Of course, if you want help in deciding how your brand fits into all that and see how that lines up with how you price, sell and package your offerings, I'd love to talk. Please send an email to molina@the brainybusiness.com.
- [44:09]
Podcast Co-host or Interviewer
Or check out our website to book.
- [44:11]
Melina Palmer
A time and learn more.
- [44:13]
Podcast Co-host or Interviewer
And of course, if you're looking to.
- [44:14]
Melina Palmer
Run a specific test like the ones.
- [44:16]
Podcast Co-host or Interviewer
That Matt was talking about in this episode, highly recommend.
- [44:19]
Melina Palmer
Behaviorally, they do fantastic work and whatever stood out to you in the episode, please do come share it with Matt and I on social media. You'll find me as the Brainy Biz pretty much everywhere and as Melina Palmer on LinkedIn. There are links in the show notes to make it easy, along with links for my top related past episodes and books, including unpacked ways to connect with Matt and myself and more. It's all available in the app you're listening to and at the brainy business.com/560 and thank you again to Matt Salem of Behaviorally for joining me on the show today. It was great to chat with and learn from you. Join me next time for another Brainy episode of the Brainy Business Podcast. It's going to be a lot of fun. You don't want to miss it. Until then, thanks again for listening and learning with me and remember to be thoughtful.
- [45:16]
Podcast Announcer
Thank you for listening to the Brainy Business Podcast. Melina offers virtual strategy sessions, workshops and other services to help businesses be more brain friendly. For more free resources, visit the brainy business dot com.