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Human Resource Metrics: Lessons from Hummus Packaging

It's strange to consider, but we can learn a great deal about the importance of HR metrics by a visit to the hummus section in your local market. Let's take a look...

For shoppers, the modern supermarket is a cornicopia overflowing with fresh food options shipped from all over the world. But through a business lens, your local supermarket is a war zone! Food manufacturers and distributors battle incessantly for the most valuable shelf space to increase the odds that you'll choose their product. Billions of dollars in packaging design pour into helping a product stand out from the background noise of competing food choices.

Through a business lens, your local supermarket is a war zone!

Demand creates competition. If demand for hummus is high, hummus makers will compete for a share of the market demand. Did you know there are now 20+ nationally distributed brands of hummus available? Each supplier seeks to answer how they will get you to buy their hummus instead of a competitor's. Beyond that, suppliers attempt to increase demand. This is the art of getting shoppers to notice hummus and buy it on an impulse.

In a sea of hummus options, how does a supplier work to get their hummus in your shopping cart?

There are a huge number of "tricks" available. Entire academic journals, such as the Journal of Marketing Research, focus on how to apply human decision-making biases to influence choice.

Here's a fun representation of just some of these well-established human decision making biases and heuristics.

One of the biases most abused in sales and marketing—because it works!—is the bigger is better effect2,4,5. This is the primary reason why a large McDonalds' Coke is simply massive and the Starbucks Venti (20oz) and Trenta (31oz) exist.

The marketing and packaging departments in companies that produce hummus are clearly aware of the "bigger is better" human decision bias and are taking full advantage of it. In fact, hummus manufacturer Sabra credits much of its explosive growth3 to packaging innovations rather than product improvements.

Hummus manufacturer Sabra credits much of its explosive growth to packaging innovations rather than product improvements.

As Sabra gained market share thanks to packaging tricks, competitors had to respond with packaging advances of their own—and respond they did. Like Sabra, other brands increased the package width dramatically, sometimes by nearly 25%, thereby increasing the apparent size of the product. But the real innovation—the hidden innovation—is in the bottom of the hummus container. Let's take a look.

See that sizable divot in the bottom of the container? That's cheating! This packaging innovation is aimed squarely at the "bigger-is-better" bias, and we fall for it over and over again. The supplier offers the same amount of product (or even less!) and at the same time makes it look bigger and, therefore, better. Now let's flip to the top of the container.

There it is again! Bonus Pack - 20% more. More is better, right? Now we even know exactly how much more (20%) is better. It must be a deal! If you have the time to stop and think about this claim as you rush through the market, you might ask yourself, "20% more than what?" or "What makes this a Bonus Pack?" or "If this is the Bonus Pack, why isn't the regular-sized pack available?"

Objective Metrics Cut through Cognitive Biases

Look closely. There is a metric on the top of this hummus container that is useful. Irrespective of all the packaging and branding mumbo-jumbo being used, we know that the package contains 12 ounces of product.

Irrespective of all the packaging and branding mumbo-jumbo being used, we know that the package contains 12 ounces of product.

This metric is shared because the Fair Packaging and Labeling Act1 requires that all consumer goods be clearly labelled with metrics such as net contents to protect consumers from packaging chicanery. If we take the time to compare hummus options on both price and weight then we can make smart decisions. But who has the time?

So, what does hummus packaging have to do with HR analytics?

3 takeaways from this exploration of hummus packaging...

  1. Base important decisions, like who to hire (and which HR software to use) on trusted metrics rather than packaging and "gut feelings." As has been shown over and over again in the research on staffing and talent management, gut feelings are flawed. Hiring decisions based on metrics and structured interviews result in far superior outcomes. Hiring managers are just as susceptible to decision biases, heuristics, and stereotypes as consumers shopping for hummus.
  2. Use metrics that relate directly to your desire, concern, or need. If highly-related metrics for a decision aren't available, then the decision will be strongly influenced by the information that is available, and that information, or packaging, or peripheral data may be too imprecise to be helpful.
  3. The group that can substantiate packaging with metrics gets the resources. Metrics have a strong influence on resource allocation decisions. If your group doesn't have metrics and another group does, guess where resources will get allocated? Work hard to define and measure outcomes that are important to the business and that will either overrule packaging bias, or confirm its truth (after all, one of the large-looking hummus containers actually does contain the most product).

References

  1. Federal Trade Commission. (2013). Fair Packaging and Labeling Act: Regulations Under Section 4 of the Fair Packaging and Labeling Act. Federal Trade Commission. https://www.ftc.gov/enforcement/rules/rulemaking-regulatory-reform-proceedings/fair-packaging-labeling-act-regulations-0
  2. Meier, B. P., Robinson, M. D., & Caven, A. J. (2008). Why a Big Mac Is a Good Mac: Associations between Affect and Size. Basic and Applied Social Psychology, 30(1), 46–55. https://doi.org/10.1080/01973530701866516
  3. Mohan, A. M. (2012). Hummus packaging propels growth for Sabra. Packaging World, 3. https://s3.amazonaws.com/coetichr/Hummus+packaging+propels+growth+for+Sabra.pdf
  4. Peetz, J., & Soliman, M. (2016). Big Money: The Effect of Money Size on Value Perceptions and Saving Motivation. Perception, 45(6), 631–641. https://doi.org/10.1177/0301006616629033
  5. Silvera, D. H., Josephs, R. A., & Giesler, R. B. (2002). Bigger is better: The influence of physical size on aesthetic preference judgments. Journal of Behavioral Decision Making, 15(3), 189–202. https://doi.org/10.1002/bdm.410
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