Rory Sutherland: Discover value in delight
Ad man Rory Sutherland needs no introduction. One of the greatest and most entertaining business thinkers, writers and speakers of our time, as the Vice Chairman of Ogilvy Group he set up the Behavioural Science Practice to apply the insights of contemporary behavioural science to the agency’s work. He spoke to the Mindlab Academy about how brand managers and marketers can work out the trick to delighting their customers, and then convince the finance team to actually let them do it.
Key to the work Rory Sutherland and his team do is spotting and unlocking Unseen Opportunities – the often illogical insights or assumptions that, when challenged, create incredible value for brands. “By rethinking the content within which goods are presented, you can often find a Butterfly Effect, a tipping point or a weird area where you can intervene that can create a huge amount of value with very little intervention”, Rory told us. “The Kano Theory is as applicable to someone designing the next generation of Sony equipment as the next wave of soft drink innovations. It says that there are elements to a product which are table stakes – they have to be there because if they’re not, then your product is rubbish. However, they don’t create much in the way of delight. Then you have performance attributes which are how good the thing is at doing the thing it’s supposed to do. If you are buying a vacuum cleaner, those would be battery life, suction power, ease of emptying… Then finally you have delight attributes. In the case of the Dyson, it’s the fact that it’s transparent and looks cool.”
“Creating such customer delight per pound scales superlinearly. Yet there are a lot of places, services and products that get everything right but there is no delight. It is always worth asking, ‘Is there one thing we can do to make people go, “Wow, this really is special”?’ It’s often surprisingly trivial. The example I always give in a building is St. Pancras having the longest champagne bar in Europe. Nobody would ever say that’s a really important metric in a railway station, but that – what I call ‘Benign Bullshit’ – just captures the imagination around that station in a way that talking about architraves and architecture simply can’t.”
But, he admits, it’s tough to get these ideas through finance. “The problem is that nobody around you will believe in your idea because nearly everyone is living in this linear world of predictability where Butterfly Effects don’t happen. If you said, ‘Sales have gone up 70% because we moved this from here to there’, you might expect to get promoted because you’ve contributed a huge amount of value. Nobody will care. If you had said you reduced the cost of packaging, you’d be carried into the building on your colleagues’ shoulders.”
“In many cases, thinking of the perfume or drinks industry for instance, packaging creates a large proponent of a product’s value. It’s easy for procurement to work out what something is going to cost, and there will be arguments that go down to a quarter of a pence per unit. But that’s a distortion because the cost is easy to identify whereas the value isn’t. This is a fundamental bias in business: people think marketing is a cost and they don’t understand that it’s a source of value generation and productivity. But you can make your whole business better by being better at marketing.”
Rory believes it is possible to make a convincing argument to spend money on delighting customers. “If you have a creative idea and it’s going to cost money, the answer to have prepared is: ‘If you put the price up by X Amount, it’s going to make you this many million of pounds because we’re confident not only that this packaging demands a higher price premium but it tastes better and increases the entire enjoyment of the product.’ It’s about switching the conversation from cost-cutting to value creation.”
And then you have to stick to your guns. “Creative thoughts are quickly accompanied by doubts. Get comfortable with a Pythonesque level of eccentric discussion”, he concludes with typical flourish.
For more insights from Rory, take a look at his latest book, Alchemy: The Surprising Power of Ideas that Don’t Make Sense or watch one of his ever-popular TED talks.