THINKER'S ALMANAC - May 7

How did a Prussian princess get the aristocracy of her country to enthusiastically turn in their gold in exchange for iron?

Subject:  Marketing - “Psycho-logy”

Event:  Publication of the book Alchemy by Rory Sutherland, 2019

What's in a name? That which we call a rose by any other name would smell as sweet. --William Shakespeare

On this day in 2019, marketing expert Rory Sutherland published the book Alchemy:  The Dark Art and Curious Science of Creating Magic in Brands, Business, and Life.  The basic premise of the book is that logic is overrated, and that employing illogic can often generate creative ideas that never would have been dreamt of otherwise. 

It’s not that logic and science aren’t important, rather Sutherland claims that human thinking is much more “psycho-logical.” By psycho-logic, Sutherland is describing an alternative, “parallel operating system within the human mind, which operates unconsciously, and is far more powerful and pervasive than you realize.” Rather than simply working off of emotion, psycho-logical thinking is based on the fact that humans are a social species, whose thinking is heavily influenced by perception, framing, and context.

Sutherland presents an excellent example of psycho-logical thinking when he discusses where he lives.  The apartment that he and his wife own is on the second floor and there is no elevator.  Logical thinking would call the lack of an elevator a liability, and as a result, the market value of the first floor apartment would be significantly more than Sutherland's second floor elevator-free apartment.  Employing psycho-logic, however, allows us to perceive reality differently; rather than seeing the lack of an elevator as a liability, Sutherland sees it as a plus because it guarantees the owner daily exercise.  Therefore, by framing the context differently, we’re able to see the added value of the second floor because it provides a free gym, a feature that’s lacking in the first floor flat.  In Sutherland’s words value is subjective depending on the way we choose to perceive reality:  “The same quality . . . can be seen as a curse or a blessing, depending on how you think of it.  What you pay attention to, and how you frame it, inevitably affects your decision-making.”

Another example of the alchemy of psycho-logic comes from the naming of menu items.  Once upon a time, there was a fish known as the Patagonian toothfish, not exactly the most appetizing of names.  Rationally, such a fish would not be sold in high-end restaurants.  However, after asking the question “What’s in a name?” an American businessman named Lee Lentz decided to reframe and rename the fish, dubbing it the Chilean sea bass.  Nothing changed about the fish except the name.  Nothing about the new name was real:  it didn't come from Chile and it wasn’t a bass.  The magic of psycho-logic and the alchemy of semantics allowed it to be sold for at least $20 a slice at high-end restaurants. 

                                                                Image by Paul Brennan from Pixabay 

In a related anecdote, Sutherland explains that Yale University was named after a philanthropist named Elihu Yale despite the fact that another man actually was more instrumental in laying the university’s foundation and working to raise money to establish it.  This man’s name was Jeremiah Dummer.  Although he earned the right to have the school named after him, calling a university “Dummer College” might not have been a wise application of the alchemy of semantics.

Yet another remarkable example of psycho-logic comes from nineteenth-century Prussia.  In 1813, Princess Marianne was brainstorming ways to raise money for the war effort against France.  Conventional, rational thinking would ask for the wealthy to contribute funds to the war chest.  Princess Marianne, however, employed some deft alchemy to reframe the context and make giving a badge of honor.  When wealthy and aristocratic women donated their gold jewelery to the state, they were given replicas of the jewelery made of iron.  Each replica was stamped with the slogan, “I gave gold for iron.”  Thus with a little psycho-logical thinking, Princess Marianne made the wearing of iron jewelery a higher status symbol than the wearing of gold.  By swapping their gold for iron, aristocratic women were able to not just signal their wealth but also their generosity and patriotism (1).

Recall, Retrieve, Recite, Ruminate, Reflect, Reason:  How did Lee Lentz use creative thinking to increase the value of the Patagonian toothfish?  How did Princess Marianne of Prussia use creative thinking to raise money for the war effort?

Challenge - Psycho-logic Solutions:  Research some historic examples of how companies or marketers came up with ideas for products or services that at first seemed illogical, but in retrospect make a lot of sense.  Identify the one idea you like best and explain its history.

Sources:  

1-Sutherland, Rory.  Alchemy:  The Dark Art and Curious Science of Creating Magic in Brands, Business, and Life.  New York:  William Morrow, 2019.