Our three Smarter Ways of Working Book Club choices this quarter offer analogies from the world of sport (and who doesn’t like a good sporting analogy?), insights into the way we really make decisions, and an examination of how seemingly insignificant trends can end up reshaping society.
This quarter’s pick is What Sport Tells Us About Life, in which Middlesex cricketer Ed Smith draws lessons from various sports that can be applied in a business (and personal) sphere. The chapter headed “Why Luck Matters – And Why Admitting It Matters Even More” is particularly insightful, though many readers may turn straight to “How Do You Win 33 Games In a Row”.
In Predictably Irrational, author Dan Ariely looks at the factors that affect our decision-making beyond pure Mr Spock-like logic. Understanding how someone’s emotional state affects their behaviour and their opinions will be helpful to anyone undertaking or commissioning consumer research.
Our third book, Microtrends, examines the idea that it is the small, emerging trends that are the most powerful forces for change in society. Mark J Penn suggests that an idea only has to be embraced by one per cent of the population to spark a major change in behaviour.
“What Sport Tells Us About Life” is full of insights into why so many people are obsessed with sport and packed with sporting analogies which, it has long been clear to me, are some of the best ways to get a point across to a marketing or media audience. Want to explain the importance of integrated communications planning? – quote Jose Mourinho. “Players don’t win trophies,” Mourinho said, “teams win trophies.” . If you wanted to explain that sometimes you can reap greater long term rewards from doing the right thing instead of cynically chasing short term goals you can mention Paolo di Canio. A hero to West Ham fans (despite his questionable political views) in 2000 he shunned a goal scoring opportunity and caught the ball from a cross instead as the Everton goalkeeper Paul Gerard was lying injured on the ground after he twisted his knee attempting a clearance on the edge of the box.
In this book Middlesex cricketer Ed Smith argues that debates about sport are what makes it so interesting and compelling. He says “Sport appeals to two apparently contradictory world views. First the notion of a golden age of true heroes from which we have gradually declined. Second the evolutionary view.. that sees sport as perpetually improving”.
The book overall also underlines the crucial need for individualism for growth. Smith says elsewhere: “sport like life advances through evolutionary individualism not top down institutional diktat”. In a media industry where there are continual calls for top-down institutional diktats such as global black box planning systems that purport to take the risk out of media scheduling it is useful to remember that in media, like sport, most real progress comes from individuals making step changes in thinking, and they should be cherished and valued. Furthermore many of the real media owner challengers in recent years have come from individuals inventing stuff that has taken off – Craigs List, YouTube and indeed the mighty Google originally. Preserving a spirit of entrepreneurialism once your business has grown is one of the true heroic challenges of any large corporation.
With chapter headers including: “Why luck matters – and admitting it even more”; “When is cheating really cheating”; “What price is too high” and “How do you win 33 games in a row?” Smith’s book should provide some interesting reading for everyone.
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This is my first exposure to the science of "behavioural economics". Basically the idea is that you can predict how people behave through a series of experiments and then apply that behaviour to business for your own benefit. In some ways this is what I understand to be sales technique. Ariely opens the book with a reference to the website of The Economist.com where there are three subscription offers: Online only for $59, Print only for $125 and print and online for $125. Obviously most people go for the final offer... is this manipulation, good sales technique or an understanding that it is only when we see things in context that we assign a value to them? This tendency in some ways under-pins the society we find ourselves in today. The more we have, the more we compare with our peers then the more we want.
This book is full of examples of how supposedly irrational and surprising behaviour is actually predictable. Like the dark arts of neuro-linguistic programming you can choose how much of these techniques you feel comfortable exploiting. And while some of them are very cynical, some of them are very positive. For instance the "save more tomorrow scheme" which was devised to solve the problem that Americans are not saving enough for retirement. "When new employees join a company... they are asked what percentage of their future salary raises they would be willing to invest in the retirement plan. It is difficult to sacrifice consumption today for saving in the distant future, but it is psychologically easier to sacrifice consumption in the future, and even easier to give up a percentage of a salary increase that one does not yet have."
Part of this book focusses on the emotional triggers for decisions. This is like the idea that a media strategy can help the effectiveness of an advertising campaign by pinpointing when the target consumer is most open to the message - for either physiological or emotional reasons (eg when hungry, or when engaged in fact gathering depending on the category. In a rather shocking experiment on male students at Berkeley there is listed a set of answers to questions in different states of sexual arousal. First the participants in a "cold, rational, superego driven state" are asked to predict what their answers will be when aroused. Then we get the comparison with when they are aroused (lets spare ourselves the details here of the technique). So there is a 70 % difference in the answer to the questions "would you tell a woman that you loved her to increase the chance that she would have sex with you" and 100% difference in the response to the question "can you imagine being attracted to a 12 year old". Male students - huh. Not having any of those baby sitting from now on.
This is a wide ranging book. In contrast to the sexual experiments there is also a chapter on honesty. Would you have believed that simply reading the Ten Commandments has a significant effect on people's honesty? And that imposing fines for late pick ups at a day care centre added to lateness rather than diminished it?
Overall the author has some useful advice to offer us and insight into how we can leverage social behaviour and emotional decision making to benefit our own working lives.
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Microtrends is all about the small trends being the ones that make the biggest difference.
The book is based on the idea that the most powerful forces in our society are the small emerging trends driven by small groups of individuals with shared characteristics. It stresses the importance of looking into these microtrends in order to really understand what’s going on around us rather than going by the big, obvious macrotrends which are often misleading and not reflective of what’s really happening.
Using polls, statistics and surveys, Mark J Penn breaks down the population into niche groups of individuals. In Microtrends he identifies and analyses 75 of these groups and talks about the growing influence they are having on society.
The key thought to take out of this book is that microtrends are fast growing and only need to constitute 1% of the nation (600K) in order to be hugely powerful. By this size they have the potential to create new markets for a business, spark a social movement, or produce massive change.
This tipping point of 1% of the population is really interesting for us as planners as it shows us at what point a target audience becomes really valuable
Penn believes we need to rely on facts and numbers to understand society better, rather than relying on our general perceptions. By analysing the data he reveals some surprising subgroups which contrast with our umbrella view.
Living Apart Togethers are long term monogamous couples who live in the same city but in separate houses – the most famous of this subgroup being Tim Burton and Helena Bonham-Carter.
Great Britain is the trend leader in LATs. As of last year there were 1m committed, exclusive couples in the UK living under 2m roofs.
In several Western European countries this is the fastest growing lifestyle and will inevitably play a role in the ever shifting dynamic of family life.
There are lots of social and cultural implications of this trend as well as opportunities for new products ie how to feed the cat while they’re away, the importance of guest parking etc but from a communications point of view this is a growing group of people with shared values and needs who don’t fall under our generalised view of long term couples and as such will probably need to be engaged with a different message.
According to Business Week 8% of US teens (1.6m) are making money on the internet. It’s likely that much of this is kids simply selling the odd item on ebay but increasingly kids are turning online interaction into serious business. This is a huge opportunity for them as they can be faceless and noone has to know they’re a teenager.
High School Moguls are reaping serious rewards. The top 100 of them in America (aged 8-18) earnt $7m in profits in 2001. Being an entrepreneur is now much more accessible for teens and its becoming a growing phenomenon with camps, summer programs and young business schemes stimulating more and more interest.
There are implications on the importance of going to college. Is it relevant to them and will they really have the patience to work hard and slowly climb the ladder of someone else’s company. For brands trying to target teenagers they probably need to make sure they’re not underestimating their experience, ambition or knowledge.
So what’s the driving force behind these microtrends?
It’s the explosion of choice and the power of personalisation where consumers are looking for products tailored to their specific needs and preferences.
100 years ago Henry Ford led the way with the Model-T, satisfying the masses with one uniform, low-cost product.
Businesses can no longer rely on this one size fits all model and have moved to more of a Starbucks model. Starbucks have successfully tapped into consumer demand to have products to suit their individual preferences and now provide a vast range of options with different sizes, coffees, milks and flavours so that everyone can find one they like.
In terms of how this affects communication it supports the need for us to talk to consumers in a meaningful way. It’s much more powerful to say something really engaging to a smaller group of people than it is to hit a bigger group with something broader which doesn’t really connect with any of them.
This encourages creating dialogue with consumers and enabling them to interact with our brands, whether it’s through user generated or edited content, voting, forums or any other way. This way we can not only engage our consumers with the brand but we can understand them better and communicate with them in a more meaningful way, rather than delivering a mass, one way message.
This book suggests that the one size fits all approach is long gone and that macro-targeting is no longer relevant. Do we need to master the skill of microtargeting – identifying small subgroups and finding out bout their individual needs and wants and will Microtargeting become the dominant means of advertising?
In this scenario what’s the role for broadcast media? Do we use it to deliver a mass message whilst simultaneously accommodating key subgroups through more carefully targeted messaging? Will the internet become all the more important as advertising and marketing is increasingly on a personalised one-to-one basis? The Internet’s ability to connect and communicate with communities of even the smallest niches and it’s ability to build databases of personal information puts it in a really strong position.
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