Left Brained Clients Getting You Down? Spring Some Behavioural Economics On Their Sorry Behinds.

Rory Sutherland, vice-chairman of Ogilvy Group UK, writing in Campaign, makes an argument for behavioural economics – a decades-old, yet newly fashionable, field of study.

Why is marketing – and, more importantly, the vital study of human behaviour – so little celebrated in the wider world of business? And why have marketers and agencies not fought back against a left-brained business culture, which seems to place human understanding so low on its list of priorities?
Perhaps it’s because we haven’t had much to fight back with.
I mean, frankly, you can’t really answer a spreadsheet with a mood-board.

Actually, I think you can answer a spreadsheet with a mood-board, but I digress.
Richard Huntington, for one, is on board with behavioural economics. “As the study of why people rarely act consistently and rationally it is the natural academic bed-fellow of the business we are all in – turning human understanding into commercial value.”
According to Wikipedia, there are three main themes in behavioural finance and economics:

  • Heuristics: People often make decisions based on approximate rules of thumb, not strictly rational analysis.
  • Framing: The way a problem or decision is presented to the decision maker will affect their action.
  • Market inefficiencies: There are explanations for observed market outcomes that are contrary to rational expectations and market efficiency. These include mis-pricings, non-rational decision making, and return anomalies.

In other words, behavioural economics is a great way to sound smart while saying people are not rational; thus, we must appeal to their emotional impulses. I hope I got that right. Last time I was in an economics class, I was hung over and deeply confused by all the graphs.
Let’s watch a video, shall we?

About David Burn

I wrote my first ad for a political candidate when I was 17 years old. She won her race and I felt the seductive power of advertising for the first time. Today—after working for seven agencies in five states—I am now head of brand strategy and creative direction at Bonehook in Portland, Oregon.