Alchemy: The Surprising Power of Ideas That Don't Make Sense

by Rory Sutherland

One of our clients at Ogilvy is an airline. I constantly remind them that asking four businessmen to pay £26 each to check in one piece of luggage is not the same as asking a married father of twofn6 to pay £104 to check in his family’s luggage. While £26 is a reasonable fee for a service, £104 is a rip-off. The way luggage pricing should work is something like this: £26 for one case, £35 for up to three. There is, after all, a reason why commuters are offered season tickets – commuting is not commutative, so 100 people will pay more to make a journey once than one person will pay to make it 100 times. In the same way, the time-saving model used to justify the UK’s current investment in the High Speed 2 rail network assumes that 40 people saving an hour ten times a year is the same as one commuter saving an hour 400 times a year. This is obviously non-sense; the first is a convenience, while the second is a life-changer.