Killer marketing secrets that always work (ft. Ogilvy Vice Chairman)

Key Takeaway

Stop trying to solve problems by improving what your product does—start improving how customers feel while using it. Rory Sutherland reveals that the laws of physics are set in stone, but the laws of psychology are magnificently malleable. Instead of spending billions on bigger batteries for electric cars, just change how range is displayed (miles instead of percentage) to eliminate anxiety. The cheapest innovations often come from reframing the problem psychologically, not technologically.

Episode Overview

Rory Sutherland, vice chairman of Ogilvy, explains how the greatest business innovations come from understanding psychology rather than engineering. He shares historical examples from James Watt's invention of 'horsepower' as a marketing metric to modern cases like Uber's map feature, demonstrating that value is created in the customer's mind, not just in the factory. The conversation explores why large companies become innovation-averse while startups like Red Bull succeed by ignoring conventional wisdom.

Full Transcript

Transcript of Killer marketing secrets that always work (ft. Ogilvy Vice Chairman) from My First Million. Auto-generated from episode audio; may contain minor errors.

There are two ways of making money. You can either make desirable things or you can make things desirable. And there's not much you can do about the laws of physics. Whereas the laws of psychology are magnificently malleable. We know about you, but do you know what you're getting into at all? Up to a point. I know of the podcast quite well. quite well. quite well. I know that you're like recently a kind of a social media star. You even though you've been killing it for decades, I heard a story about how someone just started like uploading some of your talks and it went viral and then you said, "Maybe I should do this." It happened I think accidentally and I've kind of reverse engineered what happened, which is that most marketing people talk about what they do and my argument is of necessity I started talking about how we think and consequently, consequently, consequently, you know, the willingness to accept the fact that surprisingly all arbitrary seeming trivial decisions may have a monumental effect on is actually necessary to have a proper understanding of living in a complex inter- you know, interconnected system.

You know, if you believe there are important strategic things and then there are trivial things which you delegate down to junior people and in which you have no interest whatsoever, fundamentally I think you're missing the point because the real world isn't like that. It's you know, it's full of butterfly effects, all of the bullets, you know, you know, small things. Alchemy I call my book because you can turn lead into gold. You can literally take something which is seen as a product disadvantage product disadvantage product disadvantage and turn it into a strength.

I think you had a good example of that with uh Have you ever heard Sean the story of how horsepower kind of came to be? be? be? No. No. No. Can can tell that story? So one of my great contentions So one of my great contentions is that when we look at great entrepreneurs or great inventors, Jobs, you know, if you say Edison, Ford, Watt, Boulton, they tend to be written up as historians as inventors. And my argument is that an invention isn't an innovation until it changes behavior.

changes behavior. changes behavior. I think it's Stewart Butterfield of Slack who said something very similar. You know, the only real measure of the effect of you're having on innovation is the extent to which you change behavior. And you can invent anything you like, but if you can't get anybody to adopt it, it's an invention, but it's not an innovation. innovation. innovation. And Watt was selling steam engines to mine owners. mine owners. mine owners. And the purpose of the steam engine was to replace the horses they used to walk round and round in circles draining the mine so that miners could go in and effectively mine coal, slate, coal, whatever without drowning.

What he realized is that you could you as an engineer, you could talk around, you know, the calorific capacity of the boiler or the length of the piston stroke or whatever, and these people didn't want to know. So, Watt and Boulton amongst themselves said, "Well, what do these people really want to know before they're prepared to buy a steam engine?" They said, "They want to know how many horses they no longer need to feed if they buy a steam engine. How many horses can I get rid of if I buy the steam engine?" So, Watt went out and invented a unit we still use today, which is called the horsepower.

And the reason it's not named after a famous scientist like the ohm or the Newton or the coulomb or the Watt for that matter or Celsius or anything of that kind is because it's a marketing unit. It was invented for marketing purposes because he could then go and say, "If you buy a 25 horsepower steam engine, you can actually get rid of 75 horses." Cuz I think the horses worked in shifts, so it does the work of 25 horses, but it does it 24 hours a day, so you can now get rid of of 75 horses.

And these people would go scribble scribble scribble scribble scribble cost of horses cost of feeding horses cost of looking after horses and you know on the back of an envelope they could then go well I'll have two of those. By the way we went even further than that. I mean the industrial revolution was a marketing revolution every bit as much as it was an industrial revolution because there was no point in being able to produce things in abundance if you couldn't create corresponding demand. So you know one of the things about the 18th and 19th century in England was it was an absolutely pioneering period in terms of how people marketed things.

And that included the steam engine where Watt and Boulton would go to a mine owner now let me get this right some people were already using Newcomen engines which were less efficient steam engines than the Watt engine. And Watt and Boulton would go along to the people who were already using these inefficient steam engines and this is how they priced their their own steam engine. They said we'll supply it for free you pay us a third of the money that you save on coal. So it was literally hardware as a service.

Bear in mind this was 1775. I mean years later Rolls-Royce started charging airlines for jet engines in the same way effectively. You pay us for every hour the engine is in service. Now what was ingenious about that was of course it aligned the interests of the people selling the steam engines and the people owning the mines because the people in the country where coal was most expensive most needed to make to save money on coal. That was Cornwall. Would tip where those there were tin mines quite a long way away from any available coal fields so coal was more expensive there.

And so the first Watt engines tended to be installed installed installed in places where coal was most expensive which meant the mine owners saved more money and Watt and Boulton made more money. So they were actually capturing the upside. Whereas if all you'd done is said yep it's 100 guineas for a steam engine you wouldn't been capturing any of the upside. I mean, this was you know, I have to say this this was pretty smart stuff. I mean, what one of the worst mistakes you can make is thinking that people 500 years ago, 300 years ago, 200 years ago were thick.

They were very, very clever. And probably they had less time staring at smartphones and more time to be clever, to be absolutely honest. But something I discovered the other day is the Orison straight in Denmark. The Danish crown wanted to charge effectively customs duty on any cargos passing through the straits of Denmark, and they had a kind of stranglehold over it. it. it. And the original thing was they'd send people on board and say, uh, "We'll estimate the value of your cargo and we'll charge you 10%." And they thought this is a lot of bother.

So, they said they said to the people passing through the Orison straight, "This isn't like 1350, okay? It was It was It was uh you tell us what your cargo's worth, okay? Uh, we'll charge you 10% on that. Oh, and by the way, every now and then we'll randomly buy your cargo at the price you quoted." Dude, that's like how we pay taxes. It's ingenious, isn't it? Yeah. You you can do property valuation that way, you see? It simply says, "You tell us what your house is worth, and the only deal is we have the right to buy your house for that amount of money." money." money." What's funny is, um, I think that in America, I think it's like I think 0.4%.

I could be getting the numbers off. It could but it's like between 0.4 and like 2% of Americans get audited every year. And like if you do the math, it's like I don't know, man. It might be worth pushing it and just get audited once every, uh, 30 years. actually right. Yeah. I mean, having said that, an IRS audit, from what I've heard, is a living nightmare, isn't it? Yeah. Yeah. Yeah, I'm not actually being serious. You know who needs the modern-day horsepower is all of the AI products.

You know, if you if you if you have Claude and you have ChatGPT, essentially they're all making the same-looking product, right? It looks like a chat interface and then it you type something and then it gives you something back. And so they're not differentiated in the experience or the the look and feel of the product that much. And then they come out with these models and each one has a different, you know, Opus 3.0 light, heavy, expert, pro, plus and you're you you have no idea which to use and then they use benchmarks that are it's like on the crud lightweight benchmark of coding expertise we're at 3.779.

Why don't they just have the equivalent of horsepower? Why don't they just write IQ? IQ? IQ? Yeah, or when like Apple was like the iPhone instead of saying like it's X amount of megabytes of gigs, they said a thousand songs in your pocket. A thousand songs in your pocket. Now, this is the classic thing which is that engineers, engineers, engineers, whether they know it or not, deep down just want to impress other engineers. Okay? Okay? Okay? And so a psychological solution in their engineering community would be seen as cheating.

So, I'll make the same point about electric cars which is you have this thing called range anxiety and we're spending billions and billions of dollars a year trying to produce batteries with a higher energy density. It's a really good thing. I'm not I'm not saying, "Hey engineers, you're wasting your time." But isn't it cheaper just to reduce anxiety rather than to increase range? Because if the way to reduce range anxiety is always to increase range, we'll end up with electric cars being heavier than they need to be, more expensive than they need to be and you know, with 50 kilowatt hours sitting outside your house 95% of the time effectively doing nothing.

So, reducing anxiety and I realized by the way how irrational this is. Well, I explained the story which is it it fascinates me because one of the things I think that helps, if you want to do this, is to have some degree of metacognition. Which is you don't just think, you think about your own thinking. It It's apparently true of fighter pilots. The really good fighter pilots have good cognitive skills, but they also have good metacognitive skills. They don't just go, "I'm going to do that instinctively." but they also ask, "Is there a reason why I shouldn't be doing that in this instance?" Okay?

Or this time it's different, as it were. And so, my wife's car is a Mini Cooper Electric and it's got about a I guess it's about it's about it's about uh 28-30 kWh battery and a range of about 100 mi. And I've got the Lotus Eletre, which is a 112 kWh battery, range of about 300 mi. mi. mi. And I got back from quite a lot of driving. I'd been down to Wales and back. back. back. And the car's down to 16%, okay? And I'm getting And all the lights have gone amber cuz it's at 16%, so I'm get I'm I'm going white knuckle on this.

I'm going, "God, I'm down to 16%. Oh my goodness, I'm down 16%." Then I look at the actual range and it's about 58 mi. Now, my wife's car, that's 56%. 56%. 56%. Okay? And my wife's car, we drive around at 56%, i.e. with a range of 56 mi, all the time without the slightest mention of anxiety. of anxiety. of anxiety. But when that's expressed as 16%, not 56 mi, okay? I'm suddenly having conniptions and really panicking. Now, what that suggests is that range anxiety is much more a factor of psychology than it is of physics.

And the problem with trying to increase battery range is that laws of physics are actually kind of set in stone to a large part, okay? There's not much you can do about the laws of physics. Whereas the laws of psychology are magnificently malleable. And so, that's the thing that really interests me because we spend a lot of time effectively trying to uh work within the laws of physics, which are immutable. When it would be a lot easier just to say, "Actually, you know, why don't we Why don't we take this undesirable thing and make it cool?" Right?

Right? Right? You know, this is the uh elevators need to go faster. No, no, no, just put a mirror in the elevator. a mirror. Just put a mirror. People will be happy looking at themselves. And it's actually, by the way, it gets quite philosophical this because you suddenly realize that literally trillions of dollars of effort are invested by businesses every year in pursuit of metrics which the customer may not notice or care about, whereas at the same time no money is spent on things which would actually make a huge difference.

There are relatively easy wins here for both government and the private sector in saying I'll give you an example of this. So, I call this reverse benchmarking. In other words, you look at all the metrics that everybody cares about in the category. You find a metric that's been completely and ridiculously neglected, and you double down on that thing. Now, I first came across this in Will Guidara's fantastic book Unreasonable Hospitality. Hospitality. Hospitality. He goes to the number one restaurant in the world. All of his team say we ought to copy this, we ought to do that thing with the napkins.

I really like what they do in the bathrooms with the scented chopsticks. Let's copy that. And Guidara goes, "Not going to copy any of that because two One, we can't afford to, and two, they're already doing it. What I want to know from you is what out of this evening at the world's best restaurant, Michelin three-star restaurant, something like that. What was a bit disappointing? What was a bit meh?" And they said, "The coffee was a bit average. You know, it was nothing special. And the beer drinkers, probably the chefs who'd gone along, got treated really crappily, shabbily compared to the wine drinkers." So, he goes back to his own restaurant and he appoints a coffee sommelier and a beer sommelier.

beer sommelier. beer sommelier. And he says, "Your job is not just to benchmark against these people, it's to hit it out of the park." Now, if you think about it, taking something that's bad about the category, category, category, not not saying we need to raise our level to the category average, but instead doing it spectacularly well, something that nobody's expecting. That was what Apple did, I would argue, okay? That's what Buc-ee's did. I don't know if you're Buc-ee's Where Where are you in the US? [clears throat] Yeah, I live in Texas.

We We We're big Buc-ee's guys. Buc-ee's guys. Buc-ee's guys. Yeah, okay. Yeah, okay. Yeah, okay. Basically started with an insight around women's restrooms. Now, you could have just had averagely clean women's restrooms. You would have benchmarked Never mind that. They're like the bloody Hall of Mirrors at Versailles, right? I mean, I haven't been in them, but I The men's restrooms are pretty good, but the women's ones are apparently sensational. And And And my argument is that, you know, if you Let's say you're a hotel, okay?

Everybody will focus on the rack rate and the this and the size of the room and, you know, and so on and so forth. Have you ever had a ho- even a really expensive hotel, a laundry experience that isn't a bit of a pain in the ass? You know, you've got to fill in a form, you've got to put it in the bag. By the way, if you get your laundry back, they never replace the bag the second day. So, if you want a second lot of laundry, you've got to ring up and ask for another bag and another form.

Okay? Now, what would happen if a hotel If I stayed in a hotel, which was I'm not saying you could be totally [ __ ] okay, as a hotel, as long as you have a brilliant laundry service. service. service. You know, Apple is, you know, on a par technologically with other entities, but it's sensationally good at the emotional component. You know, Buc-ee's is what we But it's it's it's a thing apart. You know, U- Uber doesn't have cabs that smell of urine. I'm not suggesting you can neglect the other stuff.

stuff. stuff. But I think what you can do is that when you cause the cu- customer to pay attention to something, it consequently becomes more important. Because it's surprising and because it it's attention-grabbing, it therefore suddenly uh causes the consumer to completely re-weight their utility function. Now, one of my examples would be car rental. I don't I don't know if you rent cars at airports, presumably occasionally. presumably occasionally. presumably occasionally. Hate doing it. Yeah. Yeah, exactly. Hate doing it. Now, once you've driven out of the car park, it's the same [ __ ] It doesn't really matter.

matter. matter. Maybe you can make rental return a bit better, but let's not worry about that, okay? okay? okay? I just ask the question, why is it that when I book a taxi for $100 to pick me up from the airport here in London, they meet me at arrivals and even push my trolley with luggage to the car park, yeah? But if I rent a car for $600, I've got to find and queue at the car rental desk. desk. desk. Then I've got to go and find, often in like 110° heat, I've got to go and find the car, and then, by the way, there is there isn't even a laminated sheet of A4 paper in the car saying, "This is how you open the fuel filler cap.

This is how you release the handbrake." You know, there's nothing, right? Once you're in the car, about 10-20 minutes in, you start to enjoy it. But that initial bit, which nobody seems to be measuring, be measuring, be measuring, is the bit that's terrible. Now, in some cases, I would literally happily pay 100 quid if the deal is, "We meet you at arrivals, okay? We take the luggage to the car. We hand you the keys. We answer your questions about how the car works." If, by the way, they also turn the air Now, you could do this with electric cars.

If they also turn the air conditioning on 10 minutes in advance, okay? Now you've done something which is Now, there's that thing What What's What's that funny thing? Turo, isn't there? I think. Which because it's humans might might be able to create something a bit like that. that. that. Yeah, they I I use Turo all the time. They have a thing where it will the the owner will drive to your home. And because of that, by the way, when I rent cars at large American airports, at Phoenix or somewhere like that, I actually arrive at Phoenix, take a taxi to the hotel, and then book the car the next day.

Because the downtown experience of car rental with no luggage is so much better than the airport experience with luggage. You know, we asked you a question earlier of like, so how do you do it? And it sounds like one thing that I'm picking up is, you know, you pay attention to what irritates you. And instead of just complaining about it, that's a great source material. I think Jerry Seinfeld says, "Irritation is innovation." I think when he was creating his uh his talk show, it's because he had been for years he'd been famous, he got invited on late night talk shows, and he would go and it's just every if you look at every late night talk show, it's the exact same.

There's the guy at the desk, there's the cheesy music, there's the band guy that they have, you know, sort of forced laughter with. And when he created Comedians in Cars Getting Coffee, it was the equivalent of a talk show. He's like, "What's the opposite of everything I hate about those things?" And then he created something and I think licensed it for like a hundred million dollars to Netflix, Netflix, Netflix, starting with irritation at the way that this thing always works. There's a British show, I don't know if this exists in the US called Room 101.

I don't know it. Room 101 is, I think it's from Orwell. It's the room to which you banish things that you really want to get rid of. And people will come in and just have a rant, and it will be everything from, you know, uh potholes, slightly boring choice, to cummerbunds, or something similar like that, you know. But something that people just think is utterly unnecessary and needs to be eradicated. And you're absolutely right, irritation is innovation. And so, one of the things is that I would argue that um there are in a sense, there are two really valuable things, one of which is what you might call the meta stuff, which is what are you really in the business of?

Now, you know, Nassim Taleb and I had this conversation about why you actually buy the things you buy. And my joke is, you know, my jokes were, "The reason you have a swimming pool isn't to swim in it. It's so that you can walk around your garden in a bathing costume without feeling like an idiot, okay? So, on a hot day, you can walk outside and and lie outside without wearing many clothes without feeling stupid, okay? And a dishwasher isn't principally valuable cuz it washes your crockery and plates.

It's valuable cuz it keeps them out of sight. sight. sight. But when you when you look at these things and go, "Maybe it's not about this, maybe it's all about that." What you have to acknowledge is two things, I think. One, think. One, think. One, you've got to let go of two handholds at once, which is what makes it difficult. One is economic logic. You know, if we reduce the price, more people will buy it. it. it. Economic logic is has very bad predictive value, I think, in the you know, in consumer behavior.

And the other thing you've got to you've got to partly abandon is conventional approaches to market research. Where you you think that we've asked the customer what it is they want and they will tell us. Because most of what we feel isn't even thought, let alone spoken. spoken. spoken. And And also, there are very very large areas of consumer behavior which are they may be meta-rational at some level, but but but nobody will ever tell you, "I would buy that product if it were more expensive." But there are plenty of documented cases of exactly that happening.

I think you you you're buddies with the Daniel Kahneman uh thinking Kahneman. I Kahneman. I Kahneman. I I I Yeah. And he in his book Thinking Fast and Slow, I don't know if you read that, Sean, but one of his like one of the famous examples was The Economist, I think it was, or something like that. They like do uh this thing where they say, "You can get The Economist for $20 a month and you get all of these things. And if you get the other version of The Economist, you get all of these things plus digital access." Paper Paper only, paper plus digital, and digital only.

And paper only and paper plus digital were the same price. So, you looked at that and your mental frame was, "If I get the if I get the paper version, I'm getting the digital one for free. Vanishingly few people ordered paper only. Now if you remove the paper only one, so you you know, effectively you had digital or digital plus paper, vanishingly few people chose the one in the middle. But the presence of the middle option increased by about two or 300% the number of people who subscribed to paper plus digital instead of digital.

digital. digital. It I think it shifted the ratio from one direction to the other. And by the way, that's pretty valuable to the economist because my hunch is that their paper circulation is much more valuable in terms of advertising revenue than their digital circulation is. One of the best Ogilvy ads, my favorite ad, is David Ogilvy writes this letter and it's I think it's called how we write ads at Ogilvy. And he like has this like long, maybe 1,000 or 2,000 word essay on like the 18 points on how they create ads that are effective.

And some people might be like, well, why would you give your secret away? And he was like, well, I'm going to teach them how we think. There's also really interesting aspect in business, which is if you give your secrets away, you assume that people will copy you. And the odd thing is they don't. And quite often the reason is they're just culturally incapable of doing it. So for example, if you point out that physical direct mail is very successful for a business, you'd think that your competitors would go, well, that's a useful learning.

I must do some more of that. What you then discover is no, actually they're culturally they just find using, for example, an old-fashioned advertising medium simply too difficult to justify or too unfashionable or whatever it may be to be comfortable with it. So even if you just give away the evidence of how you do what you do, what you find is that you're copied much less than you'd expect. expect. expect. You said you study how we think or you like to talk about how we think versus what you do.

Let's break that down. Okay, so if I just asked you a very simple question that's probably very broad and you could take it any direction you want. How do we think? I think what happens is that small businesses, family-owned businesses to some extent, founder-led businesses are an exception here. What's interesting is simply being able to understand that value is not really produced in the factory, it's produced in the mind. And that And that And that there are two ways of making money. You can either make desirable things or you can make things desirable.

And each of them is as profitable as the other. For some reason, once a business fit hits a certain size, it gets focused on what it does, not what it means. And I think there's a kind of invisible loss there. Now, similarly, at the same time, I think those businesses lose the capacity to innovate as well. Something Something rather depressing happens, which is uh you effectively get caught in a mindset where you probably have a mental metaphor for your business. You You're looking at it as if you are an engineer looking at a piece of machinery.

of machinery. of machinery. And it's reductionist. It's about optimizing the parts rather than optimizing the whole. And at some level, I think, uh that model model model becomes unhelpful. But also, what happens, I think, is that you become more and more uncomfortable with uncertainty. And this is where it gets quite interesting. There's a wonderful story I always tell, which is Richard Thaler, the Nobel Prize-winning economist and behavioral economist, the author of Nudge. He once spoke to a board of about 10 people, very large company. And he goes to the eight heads of the largest divisions of this company and he asked them all simultaneously a question.

Would you take a decision if it had a 50% chance of increasing your profits next year by 50% and a 20% chance of reducing your profits by 30%? And six out of the eight of them said, "No." "No." "No." And Thaler goes back and says, "Well, you know, you know, you know, you're all good enough mathematicians, I assume, to realize these are highly favorable odds. To a gambling man, you know, this is a very, very good bet. And yet you declined to take part. Why is that?" And they replied, six out of the eight of them, "Uh because uh 20% of the time or 30% of the time I'd lose my job." And then the interesting thing happens, which is the chief executive is sitting at the end of the table and looks aghast at the eight people and goes, "But I wanted all of you to take those odds because net net, in aggregate, we'd almost certainly end up massively better off.

off. off. Yes, two divisions, one division, might have a slightly disappointing year, but four of them would perform spectacularly." spectacularly." spectacularly." And you realize that the way that businesses are structured, as you push responsibility and accountability further and further down the organization, they become more and more risk averse and they become more and more uncertainty averse. So, they would prefer a definite 5 to 10% to a probabilistic a 50% chance of 50%. 50%. 50%. And what happens then is that you fundamentally you become highly conservative.

You're more worried about downside avoidance than you are upside opportunity. opportunity. opportunity. And as a result, obviously both innovation and marketing, I would argue, are fat-tailed activities where 10% of what you do is probably more valuable than everything else. You know, you can't tell in advance which 10% it's going to be. They are processes of exploration and discovery. And what you do is you get rid of the discovery layer discovery layer discovery layer in the pursuit of efficiency. And in the short-term it looks like a great idea.

But in the longer term it's it it proves fatal, I think, because you've lost the capacity to adapt, to reinvent, to reposition in pursuit of the occasional um the occasional breakthrough. We we have um a very startup oriented audience of which a lot of people are founder-led businesses or or they want to be. So, we could talk about like how big companies turned around, but what's an example of a startup or small company that you look at and you're like, "Oh, they nailed it and here's why they nailed it." Even though if if this was pitched at a big company, this would never have worked, but here it is kicking ass.

kicking ass. kicking ass. I mean, the example that I always feature in my book is Red Bull, which is an example of a business that makes no sense. In other words, you could only really justify Red Bull on the basis of intuition. There was some pre-existing popularity in Thailand where I think it was bought by lorry drivers to keep them awake at night. Okay? But someone there was capable of making the leap of imagination into into an uncertain future where a drink which cost a lot of money, came in a tiny can, and research told them consumers basically found mildly repellent.

Okay? In defiance of all the rational odds this had potential. And it's worth noting that generally there's always a lot of data from the past cuz all big data comes from the past. There generally isn't much data about the future. There two problems there, one of which is if you insist that every single decision is based on data, all your decision-making has a status quo bias because all your data comes from the past. There isn't any data about the future. The second problem that happens is that the the things you tend to focus on tend to be the same things that all your competitors are focused on.

Which means that you, unwittingly perhaps, become more and more similar to every other business in your category, which means you become more and more indistinguishable and less and less distinctive, which effectively means you get involved in a kind of race to the bottom. You create kind of red water competition. competition. competition. And one of the things I would say is an almost unfailing trick to innovate, both to innovation and to brand building, actually, is to find the metric which your competitors have neglected, which they don't even bother to measure, or which is difficult to measure.

measure. measure. Quite often it's an emotional metric rather than a, you know, a time, space, cost, price, distance metric. What's an example of that? Well, Apple. Well, Apple. Well, Apple. Uh in that everybody was asking the question, "What can a computer do?" in Silicon Valley at, you know, in the 1970s. And Steve asked the question, "Yeah, but what does it feel like while you're doing it?" He asked aesthetic and emotional questions in an industry where everybody was focused on technological questions. questions. questions. But another example, the Uber map is an example of that, where riding in an Uber is more or less the same as riding in any other taxi.

What Uber completely transformed was the experience of booking and waiting for a taxi. And by the way, [clears throat] at the other end of the journey, the experience of paying for it. So, the Uber map, whether this was intentional or whether it was just some software guys thinking it'd be a cute thing to do. When you booked a taxi by telephone, you rang up having no idea of what the likely availability or wait time would be. In many In many cases they say, "Yeah, we'll have a car for you in 10 minutes." You kind of go, "Oh, it's too early." You know, you had no idea.

You had no expectation of car availability. And then when you'd booked the car, you had no idea when the car was going to show up, and you'd have to hover around on the sidewalk, you know, waving at any likely-looking car passing car that appeared to be looking for your address. Suddenly, Uber changed all that because it gave you an estimate of availability, it gave you an estimate of price, price, price, uh it approved your payment in advance, and then it showed you on a cute map what the license plate number was of the car and where it was and how long it was going to take to get there.

The funny part is I think I remember Sean and I lived in San Francisco when Uber first came out, and uh you would pull up your app and you'd be like, all right, you'd see the cars driving around you. And you'd be like, oh, there's one nearby, maybe I could snag it. And I don't think that was even real. I think those were fake. I've also heard the same thing about pizza delivery. pizza delivery. pizza delivery. Uh which is when they say it's in the oven, you know, it's being you know, it's being prepared, it's in the oven.

You just have to add probably, it's probably in the oven. Uh to be honest, I don't think they're actually scanning a barcode on every piece that goes in. There is a component to it, however, which is that if you feel that progress is being made, McDonald's probably make a and KFC probably make a mistake here in that if you order on screen at McDonald's, it basically says basically says basically says uh in preparation, ready for collection. And they could probably play a game there where they say, uh you know, being prepared, uh you know, on the you know, on the tray.

They could give you an impression of forward movement because it's all to do with dopamine and and sort of uh effort and reward, and consequently, it's a little like if you're imagining a chimp hacking away at a termite mound, if it comes across one or two little termites, you know, just small pieces of reward, it'll keep going, it'll feel content to keep on going. Whereas if you have a long period of effort without any any seeming reward, fundamentally, the experience is very, very different. I mean, I remember a brilliant case of this.

And it's simply, you know, it's it's it's mind hacking. I I make no apology for it. I probably would defend in court the practice of Domino's creating Domino's creating Domino's creating somewhat fictitious delivery cycles on the grounds that it simply makes people feel better. Now, the the having the cars circling around, I've heard both stories that they are to some extent accurate or that kind of what you might call they're figurative. So, they they they show you car density without actually showing you the actual accurately location of a car.

I've heard various stories about this. There are also, by the way, elevator buttons door close door close door close which are placebo buttons. So, they don't actually speed up the closing of the doors of the elevators at all, but they give impatient people in the elevator something to do. true or is that a rumor? No, no. They they it it's effectively the illusion of agency. What? What? What? And I'm I'm I'm kind of mixed on this because my argument this gets very complicated. I mentioned this in my book, which is that Nurofen, which is kind of like Advil.

And there were various variants more expensive than the standard variant, which were, you know, Nurofen for period pain, Nurofen for cold and flu. And And And these were formulaically, in some cases, identical to the base product. And my problem there is that the psychology of pain relief pain relief pain relief is so full of placebo effects that taking something that says for period pain and costs a little bit more will actually reduce your period pain more even though the chemical constituents of the drug are more or less the same.

But, there are debates about the placebo effect and you know, all the way from people who claim that you can do placebo surgery. I mean, there are all people who claim that if you actually attempt to a fit a gastric band, then you don't fit the gastric band for whatever reason, uh reason, uh reason, uh the person will still lose weight. I mean, uh so there are people who are absolute placebo effect um fundamentalists all the way to people who are fairly skeptical, but where it's universally agreed is in the area of kind of analgesics and pain relief.

Psychological factors, perception plays a massive uh role. And of course, there are forms of pain which are enjoyable. This is where it gets a stranger still. So, if you have a cut on So, if you have a cut on your um your shin, say, and you put some sort of um uh antiseptic on it, you want it to sting in a way because the sting is evidence of efficacy. The fact that it's hurting proves it's working, and so your reaction to this stinging pain is not entirely discomfort because you've reframed it as this is proof that it's doing its job.

Yeah, it's like burning off the the germs. germs. germs. off the bad things, etc. And so, you know, this is where it gets really strange, but my argument is that nearly all organizations, and this is where innovators and and and family-owned businesses have an advantage because family-owned businesses are, for example, privately-owned businesses, founder-led businesses are free to use intuition intuition intuition in a way that publicly-held companies aren't because most people in a publicly-held organization feel that everything they do has to be rationally justifiable from the get-go.

Now, what you do has to be justifiable eventually. Yeah, there's no point in doing something which fails decade after decade. I get that. But, the freedom to actually act on hunches, to act on intuition, to place bets for which there isn't much pre-existing evidence, pre-existing evidence, pre-existing evidence, is an advantage to the entrepreneurial business over the established business, cuz they can explore a much larger solution space. solution space. solution space. Hey, can I ask you a question on how you got good at this stuff? Because I know that you're a thought leader when it comes to this stuff, but you were a practitioner for years, and I think you were a direct response copywriter.

Well, well, the story's even better. I think you were not in copywriting, got fired, and came back into the copywriting department, and went to the top, which is probably a lesson in fit and knowing your strengths and your nature rather than uh just thinking I'm good or bad. Now, I have to admit it wasn't an accident in that from about week three working as a graduate trainee in Ogilvy and Mather Direct, which was the direct response wing of Ogilvy. David Ogilvy was a massive advocate of direct response advertising because he believed that you learned what works.

And he was absolutely right. Can really quick, define direct response for people who don't understand it. So, historically, and back in 1988 when I started work, when there was there was an internet technically, but there was no web, it typically meant direct mail and couponed press advertisements, or more late or later advertisements with a coupon or a phone number. But it was an advertisement which invited the consumer, buyer, customer, interested party to respond directly to an identifiable advertisement. identifiable advertisement. identifiable advertisement. So, for example, like here's one.

It's like an ad for something and and there'll be a letter and at the end there's like a coupon and it says, "Fill this out and tell us you want to buy this vacuum." this vacuum." this vacuum." And the coupon would have a dotted line around it with a pair of scissors to encourage people to cut it out, or indeed to rip it out and put in their pocket. What would happen is on that coupon there would also be a code. You'd be asked to quote the code if you telephoned, telephoned, telephoned, which related both to the creative um execution and the media placement of the ad.

Now, bear in mind in I think certainly in the 1920s, possibly in the 19th century, 19th century, 19th century, long before medicine and science had grasped that there was such a thing as a randomized controlled trial, the advertising industry advertising industry advertising industry had had had started testing this kind of thing ages ago. Direct response copywriters would, for example, test headlines by running small classified advertisements at very low cost, each with a different little headline in a, you know, in an ad the size of a couple of postage stamps.

And they would they would learn which one got more responses, and uh they would therefore, when it came to doing more expensive large full-page advertisements, they'd use the headline that had worked in miniature. But what had happened, and I assume this was at the behest of advertisers, but I don't know for sure, is that newspapers in the United States and the United Kingdom, when they produced newspapers, they were printed on two or sometimes four parallel presses, presses, presses, just to produce the number of newspapers you needed.

Now, when these newspapers came off the presses, they were interleaved. interleaved. interleaved. So, it wasn't all the newspapers from from printing press A went to North Boston, and all the uh all the newspapers from printing press B went to South Boston. The output from the two presses was interleaved, a bit like shuffling a deck of cards. What that meant was you could run one advertisement in on press A, and a different advertisement on press B, and you'd created a randomized controlled trial where, effectively, which of the two advertisements you saw uh was effectively random.

In other words, you and your neighbor might well get a different advertisement. But it solved that problem where had you not done that in delivering, you might have had a case where all the rich people got one advertisement and all the poor people got another. And of course, statistically then the result wouldn't be very very valid. And because of this, direct response advertisers endlessly tested both creative changes and indeed media selection. They might find that one medium would work, you know, four times better than another.

And one creative execution would work twice as well as another. And sometimes very very small changes would make enormous differences. So, for years this would have run from something like the 1930s to the 1950s. There was an advertisement for a correspondence course which basically taught people to write more grammatically. And the headline was originally, "Do you make mistakes in English?" Then someone added the word "these". "Do you make these mistakes in English?" Which then peaks the curiosity of the readers. So, they want to know whether the whether they are the mistakes that they're making.

And then somebody else added the word "Do you make these common mistakes in English?" Which destigmatized the idea that if you were making these mistakes, you were an ignoramus. ignoramus. ignoramus. And so, you would actually have in direct response businesses levels of testing at that level of kind of of detail. And the reason that's so important important important is that what you realize is that is that is that in psychology in psychology in psychology there are butterfly effects all over the place. place. place. You can do surprisingly small trivial things.

things. things. And they make an inordinate difference to how people respond, how they emotionally respond, and consequently how they behave. And in many cases, that means whether they buy or whether they don't buy. don't buy. don't buy. And so, consequently long before there was behavioral economics, there was direct response advertising. And in fact, anybody who had worked in direct response advertising would have gone to one of those early practitioners in behavioral economics who said, "Yeah, we've done that for years." I don't know. And I'll give I'll give you an example.

This is This is This is it's something like 1991, 1992, and I'm working on direct response advertising for the phone company. And we simply we simply we simply um were offering people the chance to pay a couple of pounds a month extra to receive what what called star services, I think, in the United States. Network services, which is you could have call diversion, you could have call waiting on your phone, and you could have something else. Wake-up call or something like that. And you And if you've paid a certain amount monthly, these facilities were added to your home phone line.

And we wrote people letters, and it said, "Either send back the pre-laser coupon below in the in the postage-paid envelope, envelope, envelope, or call this number and quote this code." We gave them a choice of post or phone. And we had a slightly bonkers client who didn't want to offer the postal response. I don't know why. I've no idea why to this day. Okay? And so, we said, "Well, let's test it." it." it." Um Let Let's not just get rid of a coupon response, because that's dangerous, because, you know, if, you know, if you don't test this rigorously, you could end up effectively damaging your business quite significantly on a whim.

whim. whim. And so, we tested three kinds of letters, 50,000 people each, randomized, completely randomized selection, as with the newspapers. the newspapers. the newspapers. And one lot got postal only, one lot got phone only, and one lot, as before, got the choice of phone or post. Post only, 5% response rate. Phone only, 2% response rate. When you offer people a choice, it was just it was 7%. Not quite, but almost nearly, I think, the sum total of the of the two independent response rates. That That That not surprise strike you as all that weird.

weird. weird. But to an economist, this would be completely baffling cuz it would suggest that the more important factor affecting whether you bought the product was not what the product was or how much it cost, but how you were able to actually order it. And from that moment on, I remember thinking, "Okay, this is extraordinary because every now and then, there are almost certainly brilliant businesses which are failing failing failing because they failed to unblock some sort of psychological bottleneck. In this case, the psychological bottleneck might have been that, you know, all, you know, people just hated using the phone to order something.

order something. order something. And you could have rationally spent millions and millions and millions of pounds trying to improve the product or to spend ages demonstrating what a great product it was. And yet, if you fail at one psychological hurdle, you can doom yourself. And so, it's very painful. I When people say, "How do you get good at this stuff?" I'll tell you my one trick, which is I think I have ADHD. ADHD. ADHD. Broadly speaking, Broadly speaking, Broadly speaking, I'm not very interested in the middle of things.

things. things. So, I'm interested in looking at a question from a deep philosophical level, and I'm interested in trivia. I'm not really interested in in the in the middle because I think in complex systems, there are two things you can do. You can tinker with the details and achieve surprisingly valuable responses, or you can effectively come up with a new paradigm for what you're doing. It's very similar to direct response advertising where the rule is you either test one thing or you test everything. So, in direct response advertising, this would go back to the 1920s to 1930s, people like, you know, uh Claude Hopkins and the early kind of practitioners of scientific advertising as they like to call it, which is, you know, you either test the single word or you come up with a completely different advertisement with a different visual.

If you test five things, you can't be sure which one of the five is making a difference. Right. Right. Right. You know, you've said a couple of things that I I think are pretty fascinating. The first one that I wrote down was competing on a different dimension. So, you mentioned the taxi versus Uber example. And I love this because if you just sat down with a piece of paper, you gave somebody a creative assignment, you said, "Hey, make a better taxi." They would almost always focus on the ride.

The cost of the ride would be the first if I could make it way cheaper, that would be great. If I could make it way faster, that would be great. If I could make it way more premium in some way the ride. And what you pointed out was that there was a psychological bottleneck that was preventing people from doing it. When Uber first came out, I remember people thought it was overvalued. And I was living in San Francisco, they were raising money, and they were doing this analysis of what percentage of the taxi market if Uber made up 25% if it if it took 50% market share of the taxi market.

And what ended up happening was in San Francisco alone, Uber tripled the taxi market within a couple of years. a very brilliant friend who had the idea for effectively a dynamic market in transportation before Uber. Actually, he patented something before Uber did. And he has a letter responding to his idea from Guy Kawasaki which said, "I can't really see this working in the United States." He said, "Americans don't take taxis very much, maybe in New York." And actually, when you think about it, pre-Uber, pre-Uber, pre-Uber, you know, LA was a motorist market if you were if you had a car and it was a public transport market if you didn't.

It the taxi market was was relatively small. small. small. New York was an outlier. New York, obviously, the New York cabs were a major thing. But, you're absolutely right. Everybody was looking at it as if it was purely cannibalizing an existing market. Now, what the economists and what the Harvard Business Review would say is that they achieved this through lower prices. I don't think they did. I don't think Uber's actually reliably cheaper necessarily. cheaper necessarily. cheaper necessarily. Right. Right. Right. Okay? I think they achieved it through better psychology.

And the example I had of what I call Uh uh these are the sort of fat tails. Jeff Bezos puts it very well. He says, you know, in baseball the most you can score is four, but in business you can hit a thousand. thousand. thousand. And I think that the fear of uncertainty and the and the unwillingness to experiment in business is causing people to endlessly try and sort of hit singles. singles. singles. And at the expense of occasionally trying to hit a thousand. But how do I like Shawn and I are both business owners.

Like how do we go from being academic and also looking at past results to and analyzing past results? Because what's interesting is like you guys were talking about Uber. If you read their seed deck, even they said, they're like, we think that, you know, if we knock it out of the park, this might make a hundred million dollars a year, you know? Now they make hundreds of millions every week. What can you tell me where for the next week or two weeks I can shift my thinking and create a framework or something like that where I can go and deploy this stuff on my team.

team. team. maybe a habit or a question I can start asking myself. An action I can take to get the sort of different type of thinking. I'll give you a real-world example. I worked on American Express, which is probably David Ogilvy always said, if you want to be a copywriter, spend the first five or six years of your life working in direct response because you learn what works, you also learn what matters. You also learn what not to leave out. leave out. leave out. I'll give you an example of that, you know, if you were selling a product by mail order and the coupon did not say somewhere, "Expect your product within 28 days or it will be sent to you by post within 28 days." You'd probably halve the number of people ordering cuz you've now created uncertainty.

You you've now created a degree of ambiguity. So, it also it also taught you attention to detail, actually, in advertising, which I think a lot of mainstream advertising misses, which is that's all very well and good. You've made a wonderful claim. You've changed people's minds about something, but actually, if you want them to act, they require a far greater degree of certainty than could often be achieved in just a poster or TV ad. So, it it it it was a bri- it was a brilliant training.

Working on American Express was probably the best account you could possibly work on, um, in the sense that they do a bit of everything. It's a brilliant brand, but it also is a very, very professional direct marketing operation. And they do everything. They do member get member. They do card member communications. They do acquisition communications, you know, etc. You know, you know, all manner of stuff. Um, David Ogilvy, by the way, always wanted American Express to do a very simple thing, which they never had the courage to do, which was, uh, to write a letter which basically said, "Take out the American Express card, and if you aren't happy, if you don't want to keep it after your first year, we'll refund you double the fee." And nobody ever had the courage to do it.

I still think it would actually it would work. But, here was the interesting thing working on American Express. There are little things that American Express did, like putting member since on the card, which cost nothing, but have been worth and American Express people have told me this, have been worth billions of dollars to American Express since the card was started. People are more reluctant to cancel, uh, because they don't want to, you know, rejoin and go back to year zero, if you like. You know, you know, I'm 60 years old.

If I had a card with member since 24 on it, it doesn't quite say the same thing as member since '93 or whatever. '95, I think. Okay. So, that was a tiny little bit of psychology, which cost absolutely nothing. But, it also is a testament to the kind of relationship they have, which is you where you know you are a card member, we don't just issue you a card from one year to the next. You know, we can see you know it's it's an intimation that they're in a relationship with you.

But here's something that was a it was client's idea. I know I'm although the agency helped, but it was a client's idea. client's idea. client's idea. This is the late 80s, early 90s. We're encouraging people to get the American Express gold card, which was pretty expensive. I mean, you know, it was something like 80 pounds back in the 80s. 80s. 80s. And we wrote long long letters explaining all the rational reasons why you want the gold card, you know, and um this client, I think, had the leap of intuition, which was people wanted the bloody gold card anyway.

Okay, it's the late 80s, right? You know, it's a you know, an area a period of fairly conspicuous consumption. consumption. consumption. And is it they want this card anyway? You know, to be honest, we could just say it's a great looking card, you know, and people would apply. The reason they're not applying is fear of rejection. rejection. rejection. And so he managed to find a way in which you could actually say all you need to do to receive your card, not apply for your card, but receive your card, is sign your name on this form.

What we know about you suggests you're virtually pre-approved for membership, and the reason we made this so simple is we want you as a card member. Now think about the difference there psychologically between between between applying to Yale and getting a letter from Yale saying we want you to apply. Right? Okay? Okay? Okay? Or or think of it in dating terms. You're interested in a girl or a bloke, okay? okay? okay? And the difference in terms of your thought patterns if you thought that person was interested in you.

And by the way, there is I don't know if you've read The Rules by um I think I think it's called The Game by Neil Strauss, actually, about the pickup artist community. It's quite an interesting book. interesting book. interesting book. Brother, look at us. We've been we studied You should see us when we are 14, okay? We Not only did we read that, there's more highlighted parts in there aren't. aren't. aren't. But the interesting thing is, it's actually actually actually for most guys effectively propositioning everybody you fancy is a workable strategy.

Most people can't bring themselves to do it because of fear of rejection. You know, fundamentally, it most people haven't got the, you know, the chutzpah to just chat up and proposition everybody they fancy because, uh, you know you'll get a 10% hit, maybe a 5% 10% hit rate, which is of course all you need. But nonetheless, it comes at the cost of you know, significant dents to the, uh uh, the ego. I'm a very much, uh, an amateur historian and like two major takeaways I've had from reading hundreds of history books is human nature has been the same and will always be the same.

And so, you can just copy the other people who have done something or been been heavily inspired by them. second thing is that, um, when humans talk to each other, we use these phrases like, "Well, just be rational. Just be that Like, don't be an animal. Like, just be rational." And it's like, well we are animals. We are not rational people. And therefore, you can't use logic in order to build something or you can't use too much logic in order to like build something great. Humans are like very irrational irrational irrational beings.

beings. beings. It's very interesting because this idea that you should This is not to say that rationality isn't valuable. It's a question of when you deploy it. And, um, David Hume, the philosopher, said, "Reason is and should only be the slave of the passions." Now, there's a great book by a French mathematician called David Bessie called Mathematica, where he argues that very little progress in mathematics is actually made logically. What mathematicians do is they use maths to sense check their dreaming effectively. effectively. effectively. It's brought in to correct your emotional behavior emotional behavior emotional behavior when it goes wrong.

But actually, the idea that in business that the explanation of a decision is more important than the outcome of the decision to your career. That the defensibility of a decision is what you're really focused on, not the act the quality of the outcome of the decision. decision. decision. What that means is that you're effectively saying you cannot use intuition, which is a bit like going to a detective and saying you can only use information which has evidential value. You can't use gossip, you can't use anecdote, you can't use intuition, you can't use a hunch, you can't use um you know, your sense of smell, as it were.

You can only use evidential value to arrive at to actually um solve a crime. And it massively limits your ability to solve complex problems because what what your intuition is telling you to do is where to focus your attention. And in the case of you in the case of crime, you might ask a very open-ended question, "Did anybody notice anything unusual last night between the hours of 8:00 and 10:00 p.m.?" Now, very open question. question. question. All someone will say is a weird man drove past in a white van or something.

Okay? Doesn't you know, no evidential value, but it tells you what to investigate next. investigate next. investigate next. And if you demand that every single business decision is based on stepping stones of pure pre-existing data and logic, you can only get to about five of the possible 25 places where a solution might be found. And the places you'll get to will all already be occupied by your closest competitors because they're using the same stepping stones you are. Why why didn't you ever want to start a your own company?

You you you have all these like crazy cool ideas. Well, there is one which I did inspire, which is a coffee brand called flatwhite or [ __ ] off. Wait, wait, wait, hold on. Did you say you created a coffee called [ __ ] off? It exists. It It might currently be in some sort of legal dispute about the trademark. Not with me. I'm happy for them to take my Somebody trademarked a [ __ ] off? Somebody else had this idea? Let Let me Let me explain the idea. Okay. It's It struck me that there were places where you wanted a high-quality cup of coffee, but you didn't want to queue behind people who were all customizing their own bloody drinks.

And the technology with contactless payment now allows you to basically tap, pick up a coffee which has been made in advance, and walk off. And my argument is that the flat white, which is a New Zealand {slash} Australian invention with which is I think the right ratio of coffee to milk and with micro foam as well. I think I think it's basically the you know, it's the happy medium of sensible coffee drinking. And this is quite interesting because my assumption was that the place to put this is They only have two versions.

For the vegans, there's an oat flat white, and there's a regular milk flat white. You walk up, you tap your card, you pay £4, you pick up a pre-made coffee, and you walk off. And my logic was at the time train stations and um airports were the natural home for this thing. Uh they're expensive real estate, so the fact that you can sell more coffees in a given time, it's Henry Ford applied to coffee, basically. Okay? The argument is that Starbucks and the customization and the time is absolutely wonderful if you're in downtown Santa Fe near meeting a friend for 2 hours, but it's not suited to airports and railway stations.

So anyway, this thing launches. It's only It's only at the trial stage at the moment. moment. moment. But something really interesting happened, which is shortly after we launched and got some publicity, someone came to us and said, "Actually, the natural market for this isn't even train stations and railway stations. stations. stations. It's conferences. Quite often, the coffee at a business conference is rubbish because it's it's badly made filter coffee because you have to serve a lot of people simultaneously. Or you have a customizable coffee thing, right?

right? right? Where there's a massive queue cuz everybody comes out of the plenary session, they all want a coffee, so they've got something to hold in their hand and not look like an idiot, which is one of the reasons we buy coffee, by the way. Doesn't do with drinking it, it's effectively accessorizing ourselves, okay? And the point about flat white or off is it's high-quality coffee, not crappy filter coffee, that you can produce at scale by simply reducing the customization level. Now, here's where it gets interesting.

Henry Ford was a brilliant marketer. Why did he say you can have every any color as long as it's black? Because at the time, paint dried at differing speeds depending on the color. And therefore, if you had a variety of paint colors on the Ford production line, it completely messed up the flow of the production line because some cars would take longer to dry than others, and it turned out that black was the fastest drying color, so they basically imposed black on the whole Ford fleet.

So, So, So, it's absolutely fine not to give people something, something, something, to ask people to make a trade-off, so long as you make them aware of the trade-off in advance. Okay? Okay? Okay? That's why it's called flat white or off. It doesn't If you turned up at a branch of Starbucks and they said, "We we only serve flat whites, right?" You go, "What the What are you talking about? No, no, I want a Frappuccino with, you know, almond milk and blah blah blah." No, no.

Okay? No, you can't have that. It's, you know. Now, the reason it's called flat white or [ __ ] off is it makes explicit the trade-off before someone turns up. So, you say If anybody The joke is if anybody turns up and asks for a cappuccino, you point to the logo and you say, "The answer's in the name, right?" right?" right?" Now, there's an example of this which always fascinates me. Are you a fan of the Moxy hotel chain? Oh, I stayed in once in New York. They're like a kind of upscale like kind of more modern contemporary type of chain.

chain. chain. So, it's quite interesting because the rooms are tiny. There's no room service, there's no laundry, okay? But, the ground floor is kind of a bit like a well, a solvent WeWork. Right, I guess. And there's a 24-hour barista, there's a there's a usually there's someone making really quite good cocktails. You check in at the bar, you don't check in at the check-in desk. There isn't a concierge, none of that bollocks, okay? Don't go to stay there on your honeymoon, don't go to stay there for a week.

But, if you've got one or two nights to stay in a place, it's exactly what you want, okay? It's small room, very good TV, very good Wi-Fi. The other great advantage is after you've checked out in the morning and had breakfast, to be honest, you can hang out there for another 5 hours if you want to, you know? Whereas, if you tried doing that in the conventional hotel, you'd you'd feel a bit unwanted. It's a It's basically a brilliant brilliant explicit trade-off. And they always said when I spoke to them, they said basically, 90% of our customers love this.

And the reason they love us is either cuz they've stayed before, they understand the trade-off and they buy into it, or else they know about how the Moxy works and they get the deal and they've decided in advance, that's the trade-off I want. 10% of their customers are expecting the Marriott and they're pissed off as hell. And it's a classic example of actually, you know, expectation minus reality, you know, is the formula that matters. You can provide less of something so long as you don't actually disappoint.

Right. Have you seen the Slate Truck? Yes. Yes. Yes. What is it? So, it's an absolutely minimalist electric vehicle. electric vehicle. electric vehicle. It's It's $25,000. And you can effectively customize it with all manner of sort of automotive bling. bling. bling. But but but the the core trade-off is up front. They're like, "There's no heat seaters, there's no screens, there's just knobs. You got to crank the window yourself. yourself. yourself. Um it's basic. We're not filling it up with stuff, but it's If you want simplicity and you want the price to be It's a $25,000 electric pickup.

And you're just not going to get all this random junk that every car company puts in. We're not doing that." doing that." doing that." So it was absolutely explicit. And in a sense, that's what, you know, Avis did with "We're number two, so we try harder." This is, you know, "Don't do Okay, we don't have the scale of the other guys, but we make up for it somewhere else." somewhere else." somewhere else." And the consumer's very happy making trade-offs so long as they're explicit. The problem with a lot of kind of cost reduction and um you know, and uh efficiency pursuit in business is it isn't chosen by the consumer, it's imposed on them.

Mhm. Mhm. Mhm. Which is a very very different thing. But now, the Slate truck is a brilliant example of what you might call explicit minimalism. minimalism. minimalism. But it But it's brilliant. They They underdid the competition where everybody else tries to overdo the competition. And they were just very explicit about it and it resonated like crazy. I mean, I put I don't even I've never I would have never bought a pickup truck. And I put a deposit in just cuz I Did you really? help it.

I I loved what they I loved what they're all about. If I'm right, I think they'll discover something really valuable, interestingly, which is everybody's talking about the idea that cars become shareable. shareable. shareable. Now, Now, Now, I would share my Slate truck with anybody else, right? You know, what's the worst that happens? They vomit in it and I have to hose it down, right? I'm not going to share my my my existing car with anybody, right? I don't even don't even let my wife drive it.

drive it. drive it. And so, you know, one of the What they'll do, when you do these eccentric things, as with discovering that F W or F O is a is a is an absolute godsend for conference organizers. conference organizers. conference organizers. What you often do when you do something eccentric is that you plan and you do your you know cost benefit analysis and your feasibility study. But generally when you do something unusual, you discover that your target audience is actually bigger than you expected. And also it's bigger than you expected because you don't have the same competitors that everybody else does.

You know, if you think about the Marriott versus the Hampton Inn versus the DoubleTree versus the Hilton, it's all kind of like okay, right. Whereas the distinct Do you know what Moxy why the Moxy is called a Moxy? It's because the project was called Marriott on Generation X and Y. And so it was called Project Moxy and they never got round to coming up with a new name for it by the way. But the interesting thing is I'm old, right? I'm 60. 60. 60. But my wife and I my wife is 61.

Hey, cradle snatcher. And uh she you know, we both we both choose that yeah as I said, you know, five days, you know, you know, maybe five days a bit too long to stay at a Moxy. If you've got any one or two or three nights stay, it's what we go for because actually I'm not quite a boomer. I think I What am I? I'm probably I'm between Gen X and boomer or something anyway. But anyway, I'm way outside their intended target audience. And so you know, it's very interesting if you focus on one target audience, you'll general generally find there's a byproduct of your focus, you'll find incremental target audiences who by the way way way This is very interesting in terms of tech.

tech. tech. Because there's a lot of tech out there which is really valuable to the old, okay? But the problem is you can't market explicitly to old people because then young people won't buy it. So cars from you if you take someone out of the Volkswagen Golf, the average age of a Volkswagen Golf buyer who's buying a new Golf is probably about 59. But when they advertise it, they don't show 59-year-old, they show, you know, 28-year-old or a 33-year-old or whatever. And so, quite often, you have this very interesting thing that old people are quite badly served by marketing because marketing is always really eager to show the product in the hands of young people.

And there are a couple several examples of this. One of which is um bone conducting headphones. conducting headphones. conducting headphones. I don't know. They're marketed at joggers and swimmers, and the idea is that if you have bone conducting headphones, when you go jogging, you don't lose all spatial awareness and run in front of a bus. Cuz your ear lug your ear holes are still open, and all the sound is transmitted through effectively the bones that's transmitted to the bones in your inner ear. Absolutely brilliant for people with hearing loss.

hearing loss. hearing loss. Because it bypasses the stirrup and the anvil and whatever it is inside the ear, which are the bits that deteriorate when you get older, and the sound goes straight basically to your oral nerves. Absolute godsend to old people. No old people know about this. And the other one is um actually I've got one here. Uh the Samsung folding phone, okay? Sorry, bloody camera's wandered off. There we are. We've got that. Zooming in like something Okay. But this folding phone, okay? There's a secondary market there in anybody over 60 because the standard mobile phone's handset is too [ __ ] small.

small. small. You know, once your eyesight is you know, goes a bit, I've had a cataract operation, okay? The standard phone handset is pretty much unusable. So, there's a whole lot of tech out there which really intrigues me because it's actually brilliant for older people, but they just aren't told about it. it. it. Hey, can I ask you one last question? You You're You seem very well read, uh very eclectic. very eclectic. very eclectic. Um I have this Ogilvy on advertising book, but if I wanted to get better at writing copy, but also coming up with ideas and frameworks, can you suggest a few books that I could read?

Some of Okay, some of them are very old. Obvious Adams, Robert Updegraff, published in 1960. Where it You can read it basically on a single toilet visit. It's about 50-60 pages. pages. pages. Um I'm delighted to say I think Amazon keep reprinting it or somebody keeps reprinting it. reprinting it. reprinting it. Obvious Adams, the story of a successful businessman. businessman. businessman. it. Now, when you first start reading it, you'll think, "Jesus, this is a bit corny." corny." corny." Okay? Okay? Okay? But it was one of David Ogilvy's favorite books.

And it's actually about an advertising man and how his approach to problem-solving. And everybody It really delights me because every now and then I mention it on a podcast and it goes to like number one in advertising books on Amazon in the UK. I always I always take a bit of a thrill for this cuz this guy died in about 1948, you know? And his book's still influencing people. And um there's another great one called The Specialist by I think Charles Sale. These are some of these old American business books which are absolutely priceless.

Scientific Advertising by Claude Hopkins, for example. There's a book called How to Become an Advertising Man by James Webb Young, who was at J. Walter Thompson in Chicago for many years. Now, there are other great books, obviously in behavioral science, Richard Shotton has written some superb books called, for example, The Choice Factory or The Illusion of Choice. And they're really, really worth reading in terms of understanding the understanding the understanding the uh counterintuitive aspects of human psychology, if you like. Okay? They're I really, really recommend them.

Um I also recommend you just read widely. Um Nassim Taleb is one of my biggest influences because I think differently about statistical things now. I realize that the real world is actually fat-tailed, it's not a normal distribution, and that, you know, a small number of things have a disproportionate amount of power. In terms of writing, David Ogilvy's obviously anything by him is very, very good, not least because he's a very, very good writer of books as well as a very good writer of advertisements. There's also a thing which is desperately difficult to get a hold of called The Copy Handbook published by D&AD in the UK, but unfortunately I think you have to buy it on eBay and they never did a reprint.

It is about 300 quid, but see if you can find that. Cuz it's great copywriters describing how they write. Drayton Bird, um a British he's kind of the British version of Lester Wunderman in direct marketing. Various books, for example, Common Sense Direct Marketing. There's a great book published by Ogilvy called I think it's called How to Write. This is How to Write in Business from one business person to another. It's not so much about copywriting. about copywriting. about copywriting. But the guy there was Joel Raphaelson and Ken Roman wrote it.

They were two Ogilvy very senior people. I knew Joel. The other reason I'm really I'm suggesting old books is that an awful lot of things in advertising stop being used. This is why I've suggested to anybody here listening to this who's an entrepreneur, go and look at some advertising archaeology. advertising archaeology. advertising archaeology. And the reason is that advertising people people people just as engineers want to impress other engineers, advertising creatives want to impress other advertising creatives, which means they want to do something that's brand new, never been done before, da da da da da.

Actually, Actually, Actually, loads of things get discarded by the advertising industry which never stopped working. Long copy press advertising never stopped working. Direct mail never stopped working. Jingles never stopped working, although you have to call it sonic branding now. And one thing that's fascinating me which never stopped working, it just became unfashionable. became unfashionable. became unfashionable. If you go back to the 1950s, there are a lot of advertisements which are cartoon strips. strips. strips. Right? Right? Right? You know, they're like half-page, quarter-page cartoon stories with people speaking in speech bubbles.

David Ogilvy always said, "Look, that is the single most readable form of print." If you put anybody down in with a newspaper, they'll read the comic strips first. And yet, for some reason, it was massive until the 1950s and even the 1960s, lots of advertising took that form where you told a story in print. And for whatever reason, nobody's doing it. Now, it. Now, it. Now, here's what's interesting, okay? What are kids into now? It's manga, right? If you actually want to reach young people, uh uh ironically, reverting to this 1950s form of advertising where it's effectively Okay, Okay, Okay, it'll have to be, you know, differently illustrated, maybe, but it's effectively manga.

manga. manga. Would be about the coolest thing you could do. could do. could do. This is the fascinating thing, you know, as David Ogilvy said, "You're not advertising to a standing army, you're advertising to a moving parade." And new new customers, you know, new members of new target audiences uh uh are appearing all the time who aren't aware of the things that the people born 10 years earlier already know. And so, the opportunity, I think, to uh literally be innovative by simply learning from the past cuz the advertising industry is very bad at it.

Now, Now, Now, as David Ogilvy would say, you have to you sometimes you have to break the rules, but you had to know the rules in order to break them, if you see what I mean. You had to be aware of the fact you're breaking a rule, and you had to have a good reason to do it. That was fine. fine. fine. You uh You uh You uh you're a fun ass hang. Well, I hope it's been useful. I feel like we did maybe 20% of what what I think we could have talked about.

And so, I think that I think we'll do we'll do a repeat. I'm very happy to do a repeat. Dude, I have like all these notes. I'm about to like run to my marketing team and be like do all this. Bye. That was awesome. Total pleasure and anytime. Really delighted.