I like his example of asking people "What is wrong with your current measuring cup?", which got answers like "it's sometimes slippery", or "the handle gets hot with hot liquids in it", but never
"it's actually hard to measure accurately without pouring a bit, bending down to look, pouring some more, bending down again…"
People didn't see the problem, until Oxo presented them with the solution. (Oxo actually didn't invent the better measuring cup design, they just improved on it and brought it to the masses).
UPDATE: As was brought up in the comments, a company called Smart Design does the design work for Oxo. In addition, Oxo recieves many unsolicited designs, which on rare occasion turn into real products. This cup is one example.
Alex Lee at Gel 2008 from Gel Conference on Vimeo.