Category: Excerpts

💎 On the secret behind the world’s first aspirational root vegetable (scarcity)

Scarcity is a great way to make something seem more attractive and valuable. The Blues Brothers famously played ‘for one night only’ and Bernd Pichetsrieder, the great BMW marketing guru insisted on ‘always selling one less than you can’.

This kind of strategy is sometimes called the ‘velvet rope’ – ‘you can’t come in’ often makes something that much more appealing. This was also the trick behind the story of how Frederick the Great turned Prussia into a potato eating nation – he insisted that no-one but the nobility could eat the potato. The ‘aspirational’ root vegetable? Believe it.

Excerpt from: Copy, Copy, Copy: How to Do Smarter Marketing by Using Other People’s Ideas by Mark Earls

💎 On the tendency to interpret information to fit with our own behaviour (smoking and lung cancer)

My personal favourite from Festinger’s many brilliant examples of cognitive dissonance deals with people’s beliefs about the link between smoking and lung cancer. He was writing at the very birth of research on the causes of cancer. It was a unique window of time during which it was possible to test whether groups of smokers and non-smokers would accept or reject new information that had been uncovered about a link. Festinger saw the effects you’d expect from anyone suffering cognitive dissonance: heavy smokers – those who had the most to lose from the new research being right – were the most resistant to believing that a link had been proven; only 7 per cent accepted the validity of the new research. Twice as many moderate smokers accepted the link, at 16 per cent. Non-smokers were much more willing than smokers to believe the link had been proven, but as a mark of just how far social norms have swung since then, only 29 per cent of them believed the link had been proven, despite having nothing to lose.

Excerpt from: The Perils of Perception Why We’re Wrong About Nearly Everything by Bobby Duffy

💎 On the power of choice architecture in determining what we eat (eat your Broccoli, kids)

Wansink moved broccoli to the beginning of the line. The first thing hungry students now saw wasn’t fast food. Fruit was taken out of functional containers and put in an attractive wooden bowl. The salad bar went in front of the tills, making it more prominent, something you couldn’t avoid. The ice cream freezer went from invitingly transparent to opaque. Buying sugar-rich desserts was made more complex, requiring additional calculations. Wansink hadn’t actually added anything, the food on offer was the same, but he rearranged the process. The results were clear.

Broccoli consumption increased by 10-15 per cent. Fruit sales from the wooden bowl doubled. Sales of salad tripled. The percentage of students buying ice cream fell from 30 per cent to 14 per cent. In general the composition of meals was far healthier. Arrangement, not any other inducement, led to healthy eating. Wansink studied other instances of how food’s presentation and arrangement affects our relationship with it.

Excerpt from: Curation: The power of selection in a world of excess by Michael Bhaskar

💎 On the power of personalised messages (especially images)

Recently, the Behavioural Insights Team began altering the letter sent to British citizens if they failed to pay taxes on their car. The traditional letter was all text, informing the subject that if they didn’t pay now they would be hit with various penalties, including a clamped or and hefty fines. To increase the effectiveness of the letter, the scientists began experimenting with various forms of personalization. The first variant involved making a more specific threat, telling recipients that they would lose their particular model of car if they didn’t pay the tax. The second variant featured a personalized visual, so that the letter came attached with a photograph of the actual car question. While both approaches increased compliance, the customized picture was the most effective—it increased the compliance rate from 40 to 49 percent.

Excerpt from: The Smarter Screen: Surprising Ways to Influence and Improve Online Behavior by Shlomo Benartzi and Jonah Lehrer

💎 On going that little bit further than the competition to tip the pitch odds in your favour (personalisation can win the deal)

In 2005 a flagging Japanese economy convinced Takashi Hashiyama, president of the electronics firm Maspro Denkoh, to sell the corporate collection of French impressionist paintings This included a major Cezanne landscape and lesser works by Sisley, van Gogh, and Picasso. Both Christies and Sotheby’s gave presentations to Hashiyama touting their expertise and ability to achieve the highest auction prices. In Hashiyama’s judgment, the presentations were equally convincing. To settle the matter, he proposed a game of rock, paper, scissors.

“The client was very serious about this,” Christie’s deputy chairman Jonathan Rendell said, “so we were very serious about it, too.” The money was serious, too. The Maspro Denkoh collection was valued at $20 million. Both Christie’s and Sotheby’s quickly agreed to the game.

In contrast, Kanae Ishibashi, the president of Christie’s Japan, began researching RPS strategies on the Internet. You may or may not be surprised to learn that an awful lot has been written on the game. Ishibashi had a break when Nicholas Maclean, Christie’s director of impressionist and modern art, mentioned that his eleven-year-old twin daughters, Alice and Flora, played the game at school almost daily.

Alice’s advice was “Everybody knows you always start with scissors.” Flora seconded this, saying “Rock is way too obvious… Since they were beginners, scissors was definitely the safest.”

Both girls also agreed that, in the event of a scissors-scissors tie, the next choice should be scissors again — precisely because “everybody expects you to choose rock.”

Ishibashi went into the meeting with this strategy, while the Sotheby’s rep went in with no strategy at all. The auction house people sat facing each other at a conference table, flanked by Maspro accountants. To avoid ambiguity, the players wrote their choices on a slip of paper. A Maspro executive opened the slips. Ishibashi had chosen scissors, and the Sotheby’s representative had chosen paper. Scissors cuts paper, and Christie’s won. In early May 2005, Christie’s auctioned the four paintings for $17.8m, earning the auction house a 1.9m commission.

Excerpt from: How to Predict the Unpredictable: The Art of Outsmarting Almost Everyone by William Poundstone

💎 On social proof being a helpful shortcut (best-seller lists)

So we use others as a helpful shortcut. A filter. If a book is on the best-seller list, we’re more likely to skim the description. If a song is already popular, we’re more likely to give it a listen. Following others saves us time and effort and (hopefully) leads us to something we’re more likely to enjoy.

Does that mean we’ll like all those books or songs ourselves? Not necessarily. But we’re more likely to check them out and give them a try. And given the thousands of competing options out there, this increased attention is enough to give those items a boost.

Knowing others liked something also encourages people to give it the benefit of the doubt. Appearing on the best-seller list provides an air of credibility.

Excerpt from: Invisible Influence: The Hidden Forces That Shape Behavior by Jonah Berger

💎 On our tendency to seek news that confirms what we already know (we get uncomfortable with new things)

Be careful. People like to be told what they already know. Remember that. They get uncomfortable when you tell them new things. New things . . . well, new things aren’t what they expect. They like to know that, say, a dog will bite a man. That is what dogs do. They don’t want to know that man bites a dog, because the world is not supposed to happen like that. In short, what people think they want is news, but what they really crave is olds … Not news but olds, telling people that what they think they already know is true.

—Terry Pratchett through the character Lord Vetinari from his The Truth: A Discworld Novel

Excerpt from: You Are Not So Smart: Why Your Memory Is Mostly Fiction, Why You Have Too Many Friends On Facebook And 46 Other Ways You’re Deluding Yourself by David Mcraney

💎 On our present preference bias (to boost pension saving rates)

The ‘Save More Tomorrow’ programme tackles both of these barriers head-on by, first, auto-enrolling people onto workplace saving schemes to combat inertia. People are obviously completely free to opt back out, but, human nature being what it is 90 per cent stay on the scheme, with their inertia now working for them rather than against them. An auto-escalator then ups the contributions, not immediately but over time (the tomorrow bit). This shifted the reluctant hugely: when asked whether they would up their contributions now by five percentage points, most said no (we need the chocolate now). But when asked whether they’d commit to saving more in the future, 78 per cent said yes.

The impact of ‘Save More Tomorrow’ has been substantial. Before the programme, the average saving rate for workers in the sample was 3-5 per cent, but after four years this had increased nearly four-fold to 13.6 per cent.

Excerpt from: The Perils of Perception Why We’re Wrong About Nearly Everything by Bobby Duffy

💎 On new and revolutionary products (our opinions of them change as we age)

There’s a set of rules that anything that was in the world when you were born is normal and natural. Anything invented between when you were 15 and 35 is new and revolutionary and exciting, and you’ll probably get a career in it. Anything invented after you’re 35 is against the natural order of things.

Excerpt from: Paid Attention: Innovative Advertising for a Digital World by Faris Yakob

💎 On resisting the impulse to tinker with marketing approaches (paying not to change)

There was a perhaps apocryphal tale about a time when Reeves was out sailing with a client. The client made bold to ask why he should continue paying the same fee when the ad was never really changed. “What do you need all those people on my account when you never do anything?” Reeves, who could be surly, gruffed, “To keep your people from changing what I’ve done.”

Excerpt from: Branded Nation: The Marketing of Megachurch. College Inc.. and Museumworld by James Twitchell

💎 On the risk of unintended consequences (because of moral licensing)

Before starting out on this change of venue, they first collected data on the amount of paper hand towels used in the mens restroom for a period of 15 days to work out the average amount of paper towels typically used each day. Once this had been done they then introduced a large recycling bin near the sinks with signs indicating that the restrooms were participating in a paper hand towel recycling program, and that any used hand towels placed in the bin would be recycled. For the next 15 days, they then simply measured the amount of paper hand towels used.

Consistent with their laboratory studies, paper towel usage increased after the introduction of the recycling bin by an average of half a paper towel per person. At first glance this small increase doesn’t seem that big a deal. However, given that the restroom was typically used over a hundred times each work day, the increase in usage was substantial: It totaled about 12,500 paper hand towels annually for this one restroom alone.

Excerpt from: The Small BIG: Small Changes that Spark Big Influence by Robert Cialdini, Noah Goldstein, and Steve Martin

💎 On the evolutionary benefit of self-deception and lying (finding a mate)

Evolutionary biologist Robert Trivers wanted to persuade a potential mate or ally of their good intentions would be better at it if they could deceive themselves without ‘leakage’ of knowledge or intent; and the most efficient way to simulate truth-telling would be to erase internal awareness of the deception. The best liars would be those who were better at lying to themselves because they would actually believe their own deceptions when they made them. They would be more likely to survive and pass on their genes; hence our gift for self-deception.

Excerpt from: Born Liars: Why We Can’t Live Without Deceit by Ian Leslie

💎 On the need to be wary of the motivations of those offering us advice (even “impartial” outsiders)

Auditors provide a good example of this bias. One hundred thirty-nine professional auditors were given five different auditing cases to examine. The cases concerned a variety of controversial aspects of accounting. For instance, one covered the recognition of intangibles, one covered revenue recognition, and one concerned capitalization versus expensing of expenditures. The auditors were told the cases were independent of each other.

The auditors were randomly assigned to either work for the company or work for an outside investor who was considering investing in the company in question. The auditors who were told they were working for the company were 31 percent more likely to accept the various dubious accounting moves than those who were told they worked for the outside investor. So much for an impartial outsider—and this was in the post-Enron age!

Excerpt from: The Little Book of Behavioral Investing: How not to be your own worst enemy by James Montier

💎 On the various ways in which social proof affects us (obesity is contagious)

Obesity is contagious. If your best friends get fat, your risk of gaining weight goes up.

Broadcasters mimic one another, producing otherwise inexplicable fads in programming. (Think reality television, American Idol and its siblings, game shows that come and go, the rise and fall and rise of science fiction, and so forth.)

The academic effort of college students is influenced by their peers, so much so that the random assignments of first-year students to dormitories or roommates can have big consequences for their grades and hence on their future prospects. (Maybe parents should worry less about which college their kids go to and more about which roommate they get.)

In the American judicial system, federal judges on three-judge panels are affected by the votes of their colleagues. The typical Republican appointee shows pretty liberal voting patterns when sitting with two Democratic appointees, and the typical Democratic appointee shows pretty conservative voting patterns when sitting with two Republican appointees. Both sets of appointees show far more moderate voting patterns when they are sitting with at least one judge appointed by a president of the opposing political party.

Excerpt from: Nudge: Improving Decisions About Health, Wealth and Happiness by Richard Thaler and Cass Sunstein

💎 On the importance information gaps in stories (curiosity)

Stories depend on the artful manipulation of what Loewenstein calls information gaps. In McKee’s words, ‘Curiosity is the intellectual need to answer questions and close open patterns. Story plays to this universal desire by doing the opposite, posing questions and opening situations.’ The storyteller plays a cat and mouse game with the viewer (or reader, or listener), opening and closing information gaps as the narrative unfolds, unspooling the viewer’s curiosity.

Excerpt from: Curious: The Desire to Know and Why Your Future Depends on It by Ian Leslie

💎 On how creativity comes from connections (e.g. Liquid Paper)

Bosses, who were men, didn’t care. Womens labour was cheap, so much so that Graham supplemented her meagre income by painting Christmas decorations for the banks windows. The exercise reminded her of something she’d once learned: artists painted over their mistakes rather than erasing them.

And that’s what led Graham to her eureka moment. She realized she could paint over typing errors rather than erase them. She mixed white tempera paint in her kitchen blender and put it in a little bottle. Whenever she made a typo, she blotted it out with a brush, waited a few seconds for it to dry, and typed over it. Marketed as Liquid Paper, the invention became one of the bestselling office supplies of the late analogue age. In 1979 Graham sold her company to Gillette for $47.5 million.

Excerpt from: Head in the Cloud by William Poundstone

💎 On the power of reciprocity (the art of the favour)

In one especially elegant and effective experiment, psychologist David Strohmetz and his colleagues arranged for waiters to hand customers their bills with or without sweets, and examined the impact on tipping. In the control condition, diners were unlucky enough to receive their bills without any sweets at all. A second group was given a single sweet. Compared to the control group, this simple gesture of kindness resulted in a measly 3 per cent increase in tips. A third group of customers received two sweets each, and, compared to the control group, gave 14 per cent larger tips. Not bad. However, here comes the really clever bit. In the fourth and final condition, the waiters were asked to present the bill to customers along with one sweet each, then, just as they were turning away from the table, reach into their pocket and quickly hand everyone a second sweet. In terms of sweets per customer, everyone ended up with exactly the same number of sweets as those in the third group. But psychologically speaking, this was very, very different. The waiter had just carried out an unnecessary and nice favour, and, because of that, tipping increased by an impressive 23 per cent.

Excerpt from: 59 Seconds: Think a little, change a lot by Richard Wiseman

💎 On the third-person effect (an explanation for the influence of lifestyle ads)

Davison dubbed this the “third-person effect,” and it goes a long way toward explaining how lifestyle advertising might influence consumers. When Corona runs its “Find Your Beach” ad campaign, it’s not necessarily targeting you directly—because you, naturally, are too savvy to be manipulated by this kind of ad. But it might be targeting you indirectly, by way of your peers. If you think the ad will change other peoples perceptions of Corona, then it might make sense for you to buy it, even if you know that a beer is just a beer, not a lifestyle. If you’re invited to a casual backyard barbecue, for example, you’d probably prefer to show up with a beer whose brand image will be appealing to the other guests. In this context, it makes more sense to bring a beer that says, “Let’s chill out,” rather than a beer that says, “Let’s get drunk and wild!”

Unless we’re paying careful attention, the third-person effect can be hard to notice. In part, this is because we typically assume that ads are targeting us directly, as individual buyers; indirect influence can be harder to see. But it’s also a mild case of the elephant in the brain…

Excerpt from: The Elephant in the Brain: Hidden Motives in Everyday Life by Kevin Simler and Robin Hanson

💎 On small nuances in messaging having a large effect (reducing antibiotic prescriptions)

They started by collating the information about what GP practices across England were doing, and used this to identify practices whose prescription rate for antibiotics was in the top 20 per cent for their local area. Half of this group of over-prescribers were then sent a letter, signed by the Chief Medical Officer, with feedback about their prescription habits, together with three specific things they could immediately do to reduce the number of prescriptions they gave out. For example, doctors can give patients delayed prescriptions, which enable them to get their medication in the future, so long as their symptoms persist. Alongside these tips, the doctors were told how their performance compared with others. They were informed that ‘the great majority (80 per cent) of practices in [your local area] prescribe fewer antibiotics per head than yours’. When Michael and his team compared the subsequent behaviour of those doctors who received the feedback letters to that of those who got no such letter, they were surprised by the impact. Over a six-month period, GP practices receiving the feedback letters prescribed an estimated 73,400 fewer antibiotic items than those that didn’t.

Excerpt from: Think Small: The Surprisingly Simple Ways to Reach Big Goals by Owain Service and Rory Gallagher

💎 On how quickly in groups form (even when the connection is obscure)

With sports affiliations, random birthplace suffices, and in business it is where you work. To test this, the British psychologist Henri Tajfel split strangers into groups, tossing a coin to choose who went to which group. He told the members of one group it was because they all liked a particular type of art. The results were impressive: although A) they were strangers, B) they were allocated a group at random and C) they were far from art connoisseurs, the group members found each other more agreeable than members of other groups.

Excerpt from: The Art of Thinking Clearly by Rolf Dobelli

💎 On taste freeze in music (somewhere around age thirty-three)

When Spotify looked at its music-streaming data, it found that teens listen to contemporary and popular music almost exclusively. As listeners age, their tastes expand. They spend more time listening to obscure bands and album tracks that were not hits. As the years go by, some take up jazz or world music or classical. But somewhere around age thirty-three, most stop listening to contemporary hits at all. The phenomenon even has a name—taste freeze. Men are more susceptible to it than women. Another fun fact: become a parent, and your “music relevance” takes a hit equivalent to ageing four years.

Excerpt from: Head in the Cloud by William Poundstone

💎 On the power of expectations (of students)

A quick digression on expectations (we’ll return – almost as a recurring theme — to the importance of teaching and teachers later). In 1968 Robert Rosenthal conducted an experiment in America where teachers were told that randomly selected pupils had actually performed in the top 20 per cent of a test that identified ‘potential’. This was, of course, untrue. But here’s the thing: when those pupils’ IQs were tested at the end of the year, they had increased relative to everybody else. Expectations improved performance.

Excerpt from: How Britain Really Works: Understanding the Ideas and Institutions of a Nation by Stig Abell

💎 On the importance of scoring systems to the enjoyment of sports (Nadal now leads Murray by 127 points)

A few years ago a mathematician friend explained to me that the game of tennis is enjoyable to watch only because of the scoring system.

If players swapped serve alternately, and the tally worked as in basketball, (Nadal now leads Murray by 127 points to 43; new balls please) it would be almost unwatchable. But because tennis breaks the score into watertight compartments, namely games and sets, it creates a structure wherein a losing player feels he is still in with a chance right to the end. That makes the narrative of the game far more enjoyable to fans and players. And because some rounds (break-points, set-points) are more critical than others tennis’s moments of high tension are interested as in a good opera or play, with quieter moments when spectators can relax.

Excerpt from: Rory Sutherland: The Wiki Man by Rory Sutherland

💎 On the biggest long term change in society being the growth in choice (not the internet)

In a few hundred years, when the history of our time will be written from a longterm perspective, it is likely that the most important event historians will see is not technology, not the Internet, not e-commerce. It is an unprecedented change in the human condition. For the first time -literally – substantial and rapidly growing numbers of people have choices. For the first time, they will have to manage themselves. And society is totally unprepared for it.

Excerpt from: Managing Oneself by Peter Drucker

💎 On the power of not making sense (round tea bags)

So when word got out that the main tea competitor, Tetley, had a bizarre new product up its sleeve, we and our client weren’t unduly worried. PG Tips came in square tea bags, like the rest of the market in those days. Tetley’s new tea idea was round bags. This made no sense at all to us. The tea would taste just the same, wouldn’t it? We gave it a few months, at best. But how wrong we were. People loved the new round bags Tetley shot to brand leader in a year. We were reminded of this when we visited a Paul Smith exhibition. Among his mantras was: “Don’t make sense”

Excerpt from: How not to Plan: 66 ways to screw it up by Les Binet and Sarah Carter

💎 On the gap between experts’ confidence and the accuracy of their forecasts (they’re little better than coin tossers)

Philip Tetlock has done one of the most comprehensive studies of forecasters, their accuracy, and their excuses. When studying experts’ views on a wide range of world political events over a decade, he found that, across the vast array of predictions, experts who reported they had 80 percent or more confidence in their predictions were actually correct only around 45 percent of the time. Across all predictors, the experts were little better than coin tossers.

Excerpt from: The Little Book of Behavioral Investing: How not to be your own worst enemy by James Montier

💎 On the avoidance of regret being a much bigger factor in brand selection than the pursuit of perfection (I hope this TV isn’t a crock of shite)

Yet marketers very rarely acknowledge this distinction when debating the role of the brand – and it pays little attention to the job of being assuredly not crap – even though I suggest it is by far the more valuable economic role that brands play: not to be a promise of ultimate superiority but a cast iron assurance of pretty dependable non-shitness. The Fina ad is one good example. Even better is that great CDP ad for Smirnoff: “why waste money on real lemons”, which I can’t find, or the Volkswagen promise of reliability. But overall this proposition of “loss avoidance” is rare – most ads seek to boast a lot more than they reassure. Yet when you are handing over £1,000 to buy that flat screen TV, how much of your brain is worried about whether it is the best TV you can buy for £1,000, versus the part of the brain thinking “I hope this TV isn’t a crock of shite?” I’d put the ratio at about 1:2.

Because we all work in the field, marketers and advertising people are by temperament maximisers when it comes to brands. They use the fine distinctions between them to delineate themselves and to highlight their individuality.

Excerpt from: Rory Sutherland: The Wiki Man by Rory Sutherland

💎 On sailing as close to the wind as possible without capsizing (FCUK ADVERTISING)

To sail as close to the wind as we can without capsizing.

For instance:

Castlemaine lagers campaign, Australians wouldn’t give a XXXX for any other lager.

The poster campaign for French Connection UK:

FCUK FASHION and FCUK ADVERTISING.

The shop in Kings Road that sold brass front-door fittings, called Knobs and Knockers.

The Sun’s headline when Tammy Wynette died,

COUNTRY STAR TAMMY: D-E-C-E-A-S-E-D.

Eddie Izzard’s joke, “I come from a very traditional family.

My granddad hanged himself on Christmas Eve and we couldn’t take him down until January 5th.”

This is a naughty, schoolboy, playground sense of humour.

Excerpt from: Creative Mischief by Dave Trott