Sometimes treating a problem with logic will not give you the wanted results. Apply logic to any problem you have with your product and you will get a boring result that seems normal. Or as Rory Sutherland writes in his book Alchemy:
It’s true that logic is usually the best way to succeed in an argument, but if you want to succeed in life, it is not necessarily all that useful. Entrepreneurs are valuable precisely because they are not confined to doing only those things that makes sense to a committee.
If you are looking for a creative and working solution to your product problems, then logic isn’t always your best choice. And “thinking outside the box” isn’t either. A change of perception is.
People don’t always need something new. Sometimes all they need is you to make them see things different. But a change of perception requires an understanding of why certain things don’t work. What’s the true human nature and how it works. Why people love certain products or services and dislike other. And you have to decide on how to implement that change. But you can’t do it with logic, because when you demand it, you pay a price-you destroy the “magic”.
A great way to go about uncovering such “perceptions” is to ask dumb and obvious questions. For example, when you buy an expensive train ticket you get frustrated when there are no empty seats and all you have left is to stand. And the stupid question here is — ”Why do people hate to stand?”. Seems like an obvious answer — because siting is much better than standing. Also, because, the person paid a lot of money for that ticket, and the train company did not keep the promise — get a seat on the train. And in the end you get a bunch of mixed feelings about the train company.
But what if you sold “standing in a train” as a different narrative? What if there were hidden benefits to standing? In our case, what are the benefits for siting? In most trains it is comfort, less stress and a place for your luggage.
But what if the person who stands gets different benefits? For example he would get a special view outside the window? Or maybe a super fast charger, have some books to read or get a free coffee? What if that person would get a standing table where you could put your laptop and start working? Now, not having a seat doesn’t seem like a bad option. And all we did is a change of perspective-that standing is also a great option for the money if you give them the benefits too.
We don’t value things, we value their meaning. What they are is determined by the laws of physics, but what they mean is determined by the laws of psychology — Rory Sutherland
Companies that seek opportunities to do the so called magic are always listed in the top most valuable companies. Look for yourself, anything becomes more desirable when it is in scarcity. Wine looks and sounds more expensive if it has a weird French name or poured from a heavier bottle. Paying with credit cards increases our spendings, only because we don’t see the process of losing money. This makes the act of paying less painful and stressful. When the default size of the various types of stuff we use changes, so do our actions and behaviour. For example, when supermarkets double the size of trolleys, people buy 40% more. The default portion sizes in cookery books since the 1930s have increased every decade, and so have the proportions of many people.
But we don’t believe in magic and rarely apply it in our products. Why?Because you can always get fired for doing something creative, but almost never for doing something logical.
How the potato became popular
This is a story about how Frederick the Great, in the 18th century, made an almost worthless vegetable, the potato, into the most popular one to ever exist. The reason? He wanted Prussians to cultivate and eat potato and reduce the chances of starvation and death during bad times. Especially when there was a short supply of bread.
The problem was that people didn’t want it. They showed no interest in it. Even when Frederick tried to fine them, threaten and even imprison them they rejected it. Some people objected that it wasn’t mentioned in the Bible and they shall not eat it. Others argued that if dogs don’t eat it, why should they?
After giving it some thought, Frederick came with a plan. He made the potato a royal vegetable. And did not allow peasants to eat or cultivate it. He made a specific royal batch of potatoes which he hid in his castle’s basement and ordered his guards to protect it. But not too well. Why? Because when you declare something royal and make it scarce, there is a strong desire inside people to have and own it. Frederick knew it, that’s why he allowed it to be easily stolen. This way peasants would sneak in a steal them and start growing for themselves the so called “royal potato”. That’s how he popularised it.
If we allow the world to be run only by logical people, we will discover only logical things — Rory Sutherland
The change of perception in an envelope
In the book Alchemy, Rory Sutherland gives a great example of how the perception of a physical object can impact how much we spend. Each year, volunteers for one for a company (one of his clients) drop charity envelopes at peoples houses. The envelope asks for a small donation for a specific charity or cause.
In one of the experiements, they decided to divide the envelopes into 3 groups. One hundred thousand of them announced that the envelope has been delivered by volunteers; 100k of the envelopes where in better-quality paper; another 100k where in landscape view and other 100k where encouraged to fill a survey that will result in 25% tax rebate.
Any logical person would never test such things. Because why would you when you send envelopes for charity? The “rational” envelope sent brought 30% less donations. Meanwhile, the other groups generated on average 10% more donations. And an interesting part here is that the envelope with a higher quality paper, on average, generated $100 more in donations. It’s because of the “premium” feeling you are getting and subconciously you trust it more. Maybe it also feels more natural to put a $100 donation into an envelope that is thicker and of a better quality. Gives you a sense of “hey, it’s worth the money”.
The human brain does not run on logic any more than a horse runs on petrol — Rory Sutherland
To a logical person there would be no point into testing such scenarios as the examples from the above. Why? Because we are afraid to ask dumb questions and stoped believing and applying “magic” to our solutions.