Some books fundamentally change the way you view the world. This is one of them. “Alchemy” takes a well aimed shot at the prevalence of logic and rationality in business. The book’s author and source material come from the decidedly irrational world of advertising, and will sound heretic to Engineers, Finance people and other left brained types. Which is exactly why they should read it!
Rory Sutherland wants to show you the world with his eyes.
If, in addition to conventional wisdom, there was an unconventional wisdom – wouldn’t you want to learn it? And if, on top of rational answers, somebody could teach you to ask the right irrational questions – wouldn’t you want to know how? In “Alchemy”, Rory Sutherland is on a mission to convincingly prove that ratio and logic are far more limited than reasonable people believe, and make a compelling case for the undervalued power of irrationality. He calls it “magic” – but as you read the many examples in the book, you come to see it is a very practical magic.
Let’s start with the chisel Sutherland picks up to cut down the gargantuan statue of logic and ratio society erected in the halls of business and academia.
Rory is vice-chairman at Ogilvy, the advertising giant. His craft is persuasion and influence, and with the human mind his workshop, it is not surprising he has little tolerance for methods that should work, but don’t. Reading through the many anecdotes and stories in the book, it doesn’t take long before you begin to wonder if any of the logically sound methods work at all.
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The late David Ogilvy, one of the greats of the American advertising industry and the founder of the company I work for, apparently once said, ‘The trouble with market research is that people don’t think what they feel, they don’t say what they think, and they don’t do what they say.
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Once Sutherland has convincingly cut logic down to size, he enthusiastically embarks on his real mission with the book: demonstrating that there is another effective way. He explains how it works and why it works. One source of irrationality is not irrational at all, just rational within another framework of logic – such as the social one. He calls this “magic” and that may feel a little over the top, but the metaphor is better chosen than one might think. Marketeers and magicians – at least the ones we see in shows and on TV – share a common understanding. You can’t of course change reality or the law of physics, but you can alter and manipulate people’s perception. Essentially that is the core message the book conveys and it’s the difference between left brained engineers and right brained marketeers. Engineers think things are what they are. Marketeers know that things are what they appear to be.
The talk of magic sounds a little trite and to be honest, it starts to get on your nerves after the book drones on about it. But Sutherland is at his best vividly – and convincingly – illustrating his point. His favorite example concerns Eurostar, the high speed train connecting London and Paris. To address complaints about the train’s not-so-high-speed, British Railways allegedly invested 6 billion in rail infrastructure to shave 40 minutes off travel time. Sutherland contends that this is a typical Engineering solution which probably doesn’t do half as much for customer satisfaction as the magical solution he proposes. For one tenth of the cost, you could have the world’s greatest male and female walk the aisles handing out free Château Pétrus to all travelers. People wouldn’t mind the train’s speed, they might actually beg for it to go slower!
It’s a tongue in cheek proposal, but it brilliantly illustrates the core secret behind effective Marketing: don’t invest your resources in attempts to alter reality, use all your ingenuity to shape perception. Even if we can’t always explain the exact mechanism. Sutherland recounts an experiment sending charity direct mailings in a variety of ways. Versions with the flap on the short side, and a letter pointing out it had been hand delivered by volunteers, managed to raise significantly more donations than average. Letters mentioning tax deductibility raised meaningfully less. Why? No idea.
Perception management is not just a cute advertising trick. It is big business. Take Uber, for example. Their app doesn’t reduce a rider’s waiting time compared to a regular taxi. But showing the rider where the incoming car is, and how much longer the wait will be. Same reality, different perception, multi-billion business.
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There are five [sic] main reasons why we have evolved to behave in seemingly illogical ways, and they conveniently all begin with the letter S. They are: Signalling, Subconscious hacking, Satisficing and Psychophysics.
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The book loosely provides some explanation for these effects, the Science of magic. Signalling is the idea that people (and brands) do things not just for practical reasons, but to send a message to others. Airport security, for example, is not just about having strong security measures – it also needs to be strongly on display (both to deter bad actors and to provide a comforting, reassuring experience to travelers). Subconscious hacking involves influencing decisions or behaviors without appealing directly to logic or conscious thought. This includes signalling to oneself. Dressing up for an exam or important meeting will give you higher self confidence, and placebos work even if people know they are a placeho! Satisficing, a term coined by Herbert Simon, means choosing the first option that meets a minimum acceptable threshold, rather than the absolute best. Sutherland regales the story of how he doesn’t follow his car’s navigation system when he needs to fly from Heathrow. He takes a route that he knows is not optimal and about ten minutes slower on average, but doesn’t run the risk of gridlocking him on the highway (and thus causing him to miss his flight). The GPS system is a maximizer, but Sutherland is a satisficer – and you try to convince me that is not rational! Psychophysics is the study of how physical stimuli (like sound, light, or time) are perceived by the mind—not just in terms of raw data, but in subjective experience. Wine is perceived and rated as higher quality when it is served out of heavier bottles.
To wrap up, what do I think about the book? I don’t find “Alchemy” very well organized, it basically throws its basic idea in your face and then throws 600 pages of examples after it. It is a somewhat incoherent and rambling collection of anecdotes and stories, with one chapter listing ten examples and another chapter stretching one example out over ten sections. Its explanations are rudimentary, and not very logical or scientific. And you’re never quite sure whether the author is gently teaching or wickedly mocking you.
So if it wasn’t abundantly clear yet: I absolutely love this book! I find it irreverent, hilarious, unique in its style but also in the material it brilliantly covers. I will revisit it many times, as an antidote to the ever present logic poisoning my brain. I empathically recommend it, this is a must read.
The science of magic
Credits
Words
> Stefan Verstraeten
Photo
> “The Alchemist” by David Teniers de Jonge (1643/45). Teniers painted several paintings with the same title, but this version is in the Herzog Anton Ulrich Museam in Braunschweig, Germany.
> Museum of Alchemy (Prague) – Speculum Alchemiae
Video
> Mad Men, the closing episode 13 of Season 1, “The Wheel”, released on 18 October 2007, produced by Lionsgate, Weiner Bros and American Movie Classics.
> Youtube video Rory Sutherland, “Life lessons of an ad man”, at TEDGlobal Oxford (2009)
Along the same lines
