Sorry?
Yes, that’s right. Well, at least that’s correct on the surface. Delve a little deeper, and we’ll see that Rory delivered a fascinating talk on the importance of psychology in B2B marketing. Whilst economics can explain many things in business, there is one thing it cannot explain: the brain.
So, let’s begin.
If you don’t buy a ticket, you’ll never win the lottery
Rory argued that while marketers often carry out extensive research before making a major decision, their reasons for doing so are not always best for the business. Essentially, Rory claimed, these marketers are trying to use this data and research to make the safest decision – the decision that will not cause anyone to blame them should the result of the decision not be as desired.
The reasoning goes that, if a decision is based solely on data, then the decision-maker can hardly be blamed if the goal is not achieved. He can simply say ‘the data told me to do it.’
Clearly, this is never the optimal way to go about making a positive decision for your business. Instead, Rory argued marketers must take positive action, rather than defensive action. And often, this means it is important to take more risks in business.
As an example, Rory asked the question: ‘why does anyone attend a conference in the first place?’ From a purely economic point of view, if you were to weigh up the cost of a plane ticket, an admission fee, and perhaps a new suit, you would say that it was not worth attending. After all, there is no guarantee that you will obtain any business as a direct result of going to a conference.
However, you know and I know that if you never attend such events, you might never ‘get lucky’. In other words, you might never meet that person who introduces you to such-and-such; or you might never come across that company that provides this service or that service. The potential rewards are unquantifiable, but also undeniable.
Clearly, the best decisions cannot always be made using clear metrics. Obviously, data should not be ignored or discarded, but sometimes you have to take a risk to get lucky.
What’s wrong with cheap coffee?
Taking this a step further, a key theme of Rory’s talk was to deconstruct the long-held myth that B2B marketers are rational human beings. They are, in fact, just as irrational as all other humans (some of you more so than others).
As an example of this, Rory pointed to Dyson vacuum cleaners, and postulated that there could be no data to support the idea that people would spend such great sums on a vacuum cleaner. The data, he suggested, would likely say that people with enough disposable income to afford such a device would most likely rather hire a cleaner. And yet, as we all know, this is not the case. People enjoy the quality and aesthetic, and are willing to part with their hard-earned cash to get it.
Another example Rory offered was Nespresso. Where was the data that said people would spend such large sums on coffee at home? The economists among us would point to the data and say ‘No – there are cheaper options available. This won’t sell.’ And yet, as we all know, this is not the case. People enjoy drinking their favourite brand of coffee at home and are, again, willing to pay for it.
The point here is that understanding what human beings want and need cannot always be reflected in the numbers. As Rory so eloquently put it: “The job of capitalism is not to do things efficiently. The principle of free market capitalism is a process of discovery. The great thing about admitting psychology and marketing to that process is it massively expands the possible solution space. Yep – logical conventional economic theory does not tell you there’s a market for a $700 vacuum cleaner. Psychology just about might.”
As we can see by these examples, B2C marketers have been aware of the importance of psychology in marketing for a long time, but B2B marketers have often lagged behind.
Just because a person is wearing a suit, it does not mean they have transformed into a rational human being. They are the same Nespresso-drinking, Dyson-vacuuming kook as everyone else.
Why are there more fish restaurants by the sea?
To illustrate this point further, Rory posed the following question: “Why are there more fish restaurants by the sea?” Now, one might argue that the answer to this is very straightforward: fish is more readily available by the sea, and therefore it is cheaper. In addition to this, the logistical cost of transporting said fish to restaurants is also far lower. Therefore, it makes economic sense that there would be more fish restaurants by the sea.
However, just because this response makes economic sense, it does not make it the correct answer. The correct answer, Rory asserted, is “fish tastes better by the sea.” Unfortunately, this is not a metric that can be easily measured or quantified. Were the economists’ reasoning correct, there would also be an abundance of fish restaurants two miles inland, where fish is just as easily available and the logistical costs almost identically low. And yet, these restaurants simply aren’t there. They are almost exclusively located on the coast.
The point here is that we humans are deeply flawed beings, and knowing what will sell and what won’t sell cannot be understood purely through an economic lens. It’s time that psychology was taken seriously by B2B marketers the world over. Looking past the data and towards the humans you are ultimately marketing to, is key.
If you’d like to hear Rory’s entire talk, click here.
