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© 2007. Moskowitz and Gofman. All rights reserved.
What is RDE?
Selling Blue Elephants
By Howard Moskowitz and Alex Gofman
By Howard Moskowitz and Alex Gofman
| Moskowitz Jacobs Inc. |
RDE is a systematized solution-oriented business process of experimentation that designs,
tests, and modifies alternative ideas, packages, products, or services in a disciplined way
so that the developer and marketer discover what appeals to the customer, even if the
customer can’t articulate the need, much less the solution!
tests, and modifies alternative ideas, packages, products, or services in a disciplined way
so that the developer and marketer discover what appeals to the customer, even if the
customer can’t articulate the need, much less the solution!
Before we start, could you give me an example of an RDE task?
You got an assignment to launch a new credit card for your bank. How do you make consumers
pick your offer out of hundreds and hundreds of look-alikes? The marketing department suggested
conducting a survey of a targeted group of consumers. What should customers read in a credit
card offer to convince them to apply? Well, what if we just ask them what kind of APR, rewards,
annual fees, appearance, name, and so on they’d like?
Sounds like a very prudent way to obtain consumer insights to innovate - isn't a very big chunk of
mainstream consumer research is still conducted this way?
Think again! As you can guess, the results of this market research exercise turn out to be quite
predictable. The consumers want 0% APR, no annual or transaction fees, and, of course, a bunch
of meaningful, expensive benefits that are easy for them to earn and to redeem.
Is there a better way to accomplish the assignment?
pick your offer out of hundreds and hundreds of look-alikes? The marketing department suggested
conducting a survey of a targeted group of consumers. What should customers read in a credit
card offer to convince them to apply? Well, what if we just ask them what kind of APR, rewards,
annual fees, appearance, name, and so on they’d like?
Sounds like a very prudent way to obtain consumer insights to innovate - isn't a very big chunk of
mainstream consumer research is still conducted this way?
Think again! As you can guess, the results of this market research exercise turn out to be quite
predictable. The consumers want 0% APR, no annual or transaction fees, and, of course, a bunch
of meaningful, expensive benefits that are easy for them to earn and to redeem.
Is there a better way to accomplish the assignment?
When a few years ago Hewlett-Packard faced a sustained erosion of its position in the market,
despite the fact that its products were comparable or even superior to what its rivals offered,
management decided to rethink the marketing strategy and build a decision-making structure based
on evidence. In a sense, RDE helped turn around Hewlett-Packard (see chapter 1 for details about
the sustained use of RDE in high-tech companies such as HP).
When the goal was to create a better pasta sauce (as with Campbell Soup with its Prego), a good
RDE strategy systematically explored the ingredient factors that made pasta sauce better, and soon
afterward created a significantly better sauce(chapters 2 and 3 show several great examples of RDE
use by major food companies).
When the very difficult goal was to create messaging for a better Playtex tampon so women would
feel safe and discreet, that, too, was grist for RDE, which optimized the messages every bit as
easily as it handled, say, the messaging for computers, credit cards, or cars (explore Chapter 4 for
RDE use in message optimization).
When the goal was to create better package designs that jumped off the shelf for Swanson frozen
dinners, RDE was beginning to be accepted in that world of design and did its job, again with clear
increase in sales (chapter 7 demonstrates RDE use for package and magazine cover designs). Of
course, no one would ever claim that experimentation could replace artistry in design, in
communication, or even in the technicalities of product creation. It was just that RDE systematized
the process of discovery and development.
What about sustained innovation, political and social areas, and the stock market? RDE found its
home there as well (see chapters 7, “Rubik’s Cube of Consumer Electronics Innovation”; 10,
“RDE Defeats Murphy’s Law and ‘Bares’ the Stock Markets”; and 11, “Asia Calling, Ltd.: The
China Angle,” correspondingly).
Sounds good, but shouldn’t one have a triple Ph.D. in statistics, psychology, and social studies to
use RDE? And be versed in long formulas with Greek letters? Perhaps, in the early days, but not
recently. Now the answer is “Not at all.”
At one time, to drive a car, you needed to intimately know the engine, transmission, and all those
complex things under the hood and below the floorboards - and you were expected to fix your car
yourself. With time, more people had to drive, and the cars evolved into something easy to use
(albeit, much more technologically sophisticated). This, by itself, allowed even more people to
drive. How many drivers on the road now even know where the transmission is located? The same
is happening to RDE. Something invented and designed by the most educated people in the industry
is now ready to be used by any businessperson with the same ease that today’s personal computer
can be used. More companies have used RDE on a sustained basis to survive and overpower their
brutal competition. This need for RDE enticed the development of new tools that made it easier. In
turn, RDE became easier to use, and often with a lot of fun. Applying Malcolm Gladwell’s
metaphor, RDE is now reaching a tipping point.
despite the fact that its products were comparable or even superior to what its rivals offered,
management decided to rethink the marketing strategy and build a decision-making structure based
on evidence. In a sense, RDE helped turn around Hewlett-Packard (see chapter 1 for details about
the sustained use of RDE in high-tech companies such as HP).
When the goal was to create a better pasta sauce (as with Campbell Soup with its Prego), a good
RDE strategy systematically explored the ingredient factors that made pasta sauce better, and soon
afterward created a significantly better sauce(chapters 2 and 3 show several great examples of RDE
use by major food companies).
When the very difficult goal was to create messaging for a better Playtex tampon so women would
feel safe and discreet, that, too, was grist for RDE, which optimized the messages every bit as
easily as it handled, say, the messaging for computers, credit cards, or cars (explore Chapter 4 for
RDE use in message optimization).
When the goal was to create better package designs that jumped off the shelf for Swanson frozen
dinners, RDE was beginning to be accepted in that world of design and did its job, again with clear
increase in sales (chapter 7 demonstrates RDE use for package and magazine cover designs). Of
course, no one would ever claim that experimentation could replace artistry in design, in
communication, or even in the technicalities of product creation. It was just that RDE systematized
the process of discovery and development.
What about sustained innovation, political and social areas, and the stock market? RDE found its
home there as well (see chapters 7, “Rubik’s Cube of Consumer Electronics Innovation”; 10,
“RDE Defeats Murphy’s Law and ‘Bares’ the Stock Markets”; and 11, “Asia Calling, Ltd.: The
China Angle,” correspondingly).
Sounds good, but shouldn’t one have a triple Ph.D. in statistics, psychology, and social studies to
use RDE? And be versed in long formulas with Greek letters? Perhaps, in the early days, but not
recently. Now the answer is “Not at all.”
At one time, to drive a car, you needed to intimately know the engine, transmission, and all those
complex things under the hood and below the floorboards - and you were expected to fix your car
yourself. With time, more people had to drive, and the cars evolved into something easy to use
(albeit, much more technologically sophisticated). This, by itself, allowed even more people to
drive. How many drivers on the road now even know where the transmission is located? The same
is happening to RDE. Something invented and designed by the most educated people in the industry
is now ready to be used by any businessperson with the same ease that today’s personal computer
can be used. More companies have used RDE on a sustained basis to survive and overpower their
brutal competition. This need for RDE enticed the development of new tools that made it easier. In
turn, RDE became easier to use, and often with a lot of fun. Applying Malcolm Gladwell’s
metaphor, RDE is now reaching a tipping point.
Why RDE?
 | |  | |  |
| "You will know (and use to your benefit) more about your competitor than he knows about himself. What you do need is the breakthrough called RDE. Read this book. Experiment. And discover the biggest competitive advantage you've ever had." Jerry Lee, Owner, WBEB Radio Philadelphia |
| | | | |
Show the customers (or let them try) several systematically designed prototypes, and they will tell
what they like, what they do not, and what does not make any difference to them. The experimental
design used for the prototypes creation will “magically” return to you what each individual feature
(option or ingredient) “brings” to the party.
Now you have a clear way to create rules for winning offerings or new best-selling products by
combining those features into the best possible combinations - even if no consumer ever tested
these specific combinations. You will see this simple, structured process in many examples in this
book.
*Read Chapter 4: How to Make People Feel Good Even When They Pay More for more details.
what they like, what they do not, and what does not make any difference to them. The experimental
design used for the prototypes creation will “magically” return to you what each individual feature
(option or ingredient) “brings” to the party.
Now you have a clear way to create rules for winning offerings or new best-selling products by
combining those features into the best possible combinations - even if no consumer ever tested
these specific combinations. You will see this simple, structured process in many examples in this
book.
*Read Chapter 4: How to Make People Feel Good Even When They Pay More for more details.