|Life lessons from an ad man | Rory Sutherland|
The following article is derived from the accompanying video. It is provided as an additional resource for your reading convenience.
In this Ted Talk, Rory Sutherland tells his audience, “It’s suddenly come to me after years working in the business, that what we create in advertising, which is intangible value — you might call it perceived value, you might call it badge value, subjective value, intangible value of some kind — gets rather a bad rap.”
“If you think about it, if you want to live in a world in the future where there are fewer material goods, you basically have two choices. You can either live in a world which is poorer, which people in general don’t like. Or you can live in a world where actually intangible value constitutes a greater part of overall value, that actually intangible value, in many ways is a very, very fine substitute for using up labor or limited resources in the creation of things”, Sutherland expounds.
He then gives the following example. “This is a train which goes from London to Paris. The question was given to a bunch of engineers about 15 years ago, “How do we make the journey to Paris better?” And they came up with a very good engineering solution, which was to spend six billion pounds building completely new tracks from London to the coast, and knocking about 40 minutes off a three-and-half-hour journey time.”
“Now, call me Mister Picky. I’m just an ad man …… but it strikes me as a slightly unimaginative way of improving a train journey merely to make it shorter. Now what is the hedonic opportunity cost on spending six billion pounds on those railway tracks?
Here is my naive advertising man’s suggestion. What you should in fact do is employ all of the world’s top male and female supermodels, pay them to walk the length of the train, handing out free Chateau Petrus for the entire duration of the journey. Now, you’ll still have about three billion pounds left in change, and people will ask for the trains to be slowed down”, Sutherland says to his laughing audience.
Sutherland goes on to say, “Now, here is another naive advertising man’s question again. And this shows that engineers,medical people, scientific people, have an obsession with solving the problems of reality, when actually most problems, once you reach a basic level of wealth in society, most problems are actually problems of perception.”
“So I’ll ask you another question. What on earth is wrong with placebos? They seem fantastic to me. They cost very little to develop. They work extraordinarily well. They have no side effects, or if they do, they’re imaginary, so you can safely ignore them”, Sutherland says.
“Actually, the point of placebo education is interesting. How many problems of life can be solved actually by tinkering with perception, rather than that tedious, hardworking and messy business of actually trying to change reality? Here’s a great example from history. I’ve heard this attributed to several other kings, but doing a bit of historical research, it seems to be Frederick the Great of Prussia was very, very keen for the Germans to adopt the potato and to eat it, because he realized that if you had two sources of carbohydrate, wheat and potatoes, you get less price volatility in bread. And you get a far lower risk of famine, because you actually had two crops to fall back on, not one”, Sutherland explains.
He then laments, “The only problem is: potatoes, if you think about it, look pretty disgusting. And also, 18th century Prussians ate very, very few vegetables –rather like contemporary Scottish people.”
“So, actually, he tried making it compulsory. The Prussian peasantry said, “We can’t even get the dogs to eat these damn things. They are absolutely disgusting and they’re good for nothing.” There are even records of people being executed for refusing to grow potatoes. So he tried plan B. He tried the marketing solution, which is he declared the potato as a royal vegetable, and none but the royal family could consume it. And he planted it in a royal potato patch, with guards who had instructions to guard over it, night and day, but with secret instructions not to guard it very well”, Sutherland tells his Ted Talk audience.
He continues by saying “Now, 18th century peasants know that there is one pretty safe rule in life, which is if something is worth guarding, it’s worth stealing. Before long, there was a massive underground potato-growing operation in Germany. What he’d effectively done is he’d re-branded the potato. It was an absolute masterpiece.”
Sutherland then says, “Persuasion is often better than compulsion. These funny signs that flash your speed at you, some of the new ones, on the bottom right, now actually show a smiley face or a frowny face, to act as an emotional trigger.”
“What’s fascinating about these signs is they cost about 10 percent of the running cost of a conventional speed camera, but they prevent twice as many accidents. So, the bizarre thing, which is baffling to conventional, classically trained economists, is that a weird little smiley face has a better effect on changing your behavior than the threat of a £60 fine and three penalty points”, Sutherland states.
He further says, “This again is from Prussia, from, I think, about 1812, 1813. The wealthy Prussians, to help in the war against the French, were encouraged to give in all their jewelry. And it was replaced with replica jewelry made of cast iron.”
“The interesting thing is that for 50 years hence, the highest status jewelry you could wear in Prussia wasn’t made of gold or diamonds. It was made of cast iron. Because actually, never mind the actual intrinsic value of having gold jewelry. This actually had symbolic value, badge value. It said that your family had made a great sacrifice in the past”, Sutherland explains.
He wraps up this Ted Talk by saying, “And a final thing: When you place a value on things like health, love, sex and other things, and learn to place a material value on what you’ve previously discounted for being merely intangible, a thing not seen, you realize you’re much, much wealthier than you ever imagined. Thank you very much indeed.”
Rory Sutherland is a British advertising executive. He is the current Executive Creative Director of OgilvyOne.