Why sensible ads are unwise (A beginners guide to behavioural economics.)

A dairy farmer contacted the local uni as he was having problems with milk production. A team of professors were assembled, headed by a theoretical physicist. After an intensive three week investigation the physicist returned to the farm. He told the farmer, “I have the solution, but it only works in the case of spherical cows in a vacuum

Why am I telling you this awful joke?

Physics and Economics have a lot in common, they both attempt to explain the world in a controlled environment. Physics looks at how objects interact in perfect conditions and Economics tries to do the same. However economics fails to appreciate it’s objects aren’t perfect, they don’t live in a vacuum and their behaviour doesn’t follow a formula. Behind each object is an individual with their own unique behaviour.

Behavioural Economics is the study of what (subconsciously) influences our behaviour.

If you work in advertising or design you may already be familiar with what I’m about to say, but for everyone here’s a really short introduction.

This won’t make you an expert but you will discover a few tricks you can impress colleagues with at your next big meeting.

Ok, let’s get stuck in…

So, What do you see here?

You’re not unusual if you see a face,

Some even think one of the above has a passing resemblance to the current president of the United States (hint — it’s the bin)

Seeing faces in things is called pareidolia. And people see faces everywhere.

Our brain has to manage so many things that we’ve evolved to use short cuts in our thinking.

Here, we’ve evolved to rapidly recognise faces. These instincts have developed to keep us alive.

When prehistoric man (or woman) was wandering the earth it was important he spotted anything that looked like danger. Occasionally he’d run seeing a face that turned out to be just a really strange tree. But on the occasion it was a foe in the woods, he was already sprinting to safety.

We’re primed to spot faces. It’s instinctive.

Similarly, those into photography probably know the rule of thirds.

The rule of thirds splits a picture up with imaginary lines every third of the frame. Photographers suggest lining up important parts of a shot along one of these imaginary lines. It’s believed they capture our attention when they are placed there. When you look at a face, the eyes and mouth are also positioned on these lines. We’re instinctively always looking for faces, and therefore even in a photo, we instinctively look at these points first.

Our brain is full of these mental shorts cuts, they’re called cognitive biases.

Nobel Prize Winner Daniel Kahneman talks in his book, Thinking Fast and Slow, about two systems in the brain called System 1 and System 2.

Not really correct but you get the idea there’s two different processes in the brain

What are system 1 and system 2?

It’s not about the brain having a creative side and an analytical one, although these concepts are related. It’s about the brain having two speeds, fast and slow.

System 1 deals with the instinctive stuff, such as catching a ball or recognising faces. Instinctive, and therefore the fast system.

System 2 deals with complex thinking such as making a right turning into heavy on coming traffic (a left turn in some countries). Thinking, and therefore the slower system. Incidentally, if you’re chatting while looking for the perfect gap in oncoming traffic you might not even realise you’ve paused your conversation so you can concentrate.

Just like a computer, your brain can’t complete too many complex tasks at the same time. Even my MacBook Pro can’t run Photoshop and Final Cut at the same time.

Fortunately, most of the brains processing is low wattage System 1 thinking. If we had to think about everything we did, we’d never achieve anything.

Emotions are an example of System 1 thinking. Fear, Anger, Sadness are all instinctive. You don’t think about getting fearful. It just happens. Again this is a way to protect us.

That’s why advertising often uses emotion, especially humour. Laughing is instinctive, we don’t think — is this funny?

By evoking a laugh you’ve triggered a response and made a connection with the brain. It’s why ad agencies prefer to create emotional ads rather than present rational reasons to buy. Ads that compare prices require a bit of thinking. They’re asking us to weigh up whether something is a good deal, and that’s even if we notice them.

It’s not wrong to present the facts, but without emotion, it just has a lower chance of resonating. It can to hit home it just needs a massive amount more repetition and media spend.

Behavioural Economics is really just the study of our brain’s short cuts and how they can be used to influence others.

You might think this actually sounds more like psychology… and it is.

Calling behavioural psychology, behavioural economics, is itself the use of a mental short cut.

If you’re the CEO of a company you feel safer taking advice from an Economist than a Psychologist. As stated earlier Economics follows rational logical rules that are easy to justify, especially to shareholders, whereas Psychology in comparison seems a little like faith healing. By rebranding Behavioural Psychology as Behavioural Economics it’s taken more seriously by those who take things seriously.

Going forward I’ll explain a different mental short cut each week, in my attempt to simplify all the clever academic waffle, so please subscribe.



Professional thinker. I’ve been a director of art, writer of copy, designer of experience, juggler of statistics & researcher of insights.

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