Alchemy: The Dark Art and Curious Science of Creating Magic in Brands, Business, and Life

by Rory Sutherland

The opposite of a good idea can also be a good idea. Don’t design for average. It doesn’t pay to be logical if everyone else is being logical. The nature of our attention affects the nature of our experience. A flower is simply a weed with an advertising budget. The problem with logic is that it kills off magic. A good guess which stands up to observation is still science. So is a lucky accident. Test counterintuitive things only because no one else will. Solving problems using rationality is like playing golf with only one club. Dare to be trivial. If there were a logical answer, we would have found it.

Alongside the inarguably valuable products of science and logic, there are also hundreds of seemingly irrational solutions to human problems just waiting to be discovered, if only we dare to abandon standard-issue, naïve logic in the search for answers.

because reductionist logic has proved so reliable in the physical sciences, we now believe it must be applicable everywhere – even in the much messier field of human affairs.

a spreadsheet leaves no room for miracles.

In our addiction to naïve logic, we have created a magic-free world of neat economic models, business case studies and narrow technological ideas, which together give us a wonderfully reassuring sense of mastery over a complex world.

The need to appear scientific in our methodology may prevent us from considering other, less logical and more magical solutions,

problems almost always have a plethora of seemingly irrational solutions waiting to be discovered, but that nobody is looking for them;

It’s true that logic is usually the best way to succeed in an argument, but if you want to succeed in life it is not necessarily all that useful; entrepreneurs are disproportionately valuable precisely because they are not confined to doing only those things that make sense to a committee.

Modern consumerism is the best-funded social science experiment in the world,

the problem with attachment to certainty is that it causes people completely to misrepresent the nature of the problem being examined, as if it were a simple physics problem rather than a psychological one.

Illustration by Greg Stevenson

Not everything that makes sense works, and not everything that works makes sense.

It’s important to remember that big data all comes from the same place – the past. A new campaigning style, a single rogue variable or a ‘black swan’ event can throw the most perfectly calibrated model into chaos.

Irrational people are much more powerful than rational people, because their threats are so much more convincing.

Being slightly bonkers can be a good negotiating strategy: being rational means you are predictable, and being predictable makes you weak.

If you are wholly predictable, people learn to hack you.

what looks neat and logical when viewed with hindsight is usually much messier in real time.

It isn’t necessary for anything to make sense: if it works it survives and proliferates; if it doesn’t, it diminishes and dies. It doesn’t need to know why it works – it just needs to work.

Evolution is like a brilliant uneducated craftsman: what it lacks in intellect it makes up for in experience.

the single greatest strength of free markets is their ability to generate innovative things whose popularity makes no sense.

Logical ideas often fail because logic demands universally applicable laws but humans, unlike atoms, are not consistent enough in their behaviour for such laws to hold very broadly.

there are two equally potent, but completely contradictory, ways to sell a product: ‘Not many people own one of these, so it must be good’ and ‘Lots of people already own one of these, so it must be good.’

Our very perception of the world is affected by context, which is why the rational attempt to contrive universal, context-free laws for human behaviour may be largely doomed.

he prefers small certain gains to those which on average will be higher but where the payoff is hard to calculate in advance.* However, this natural human love of certainty may also prevent businesses from making more valuable discoveries. After all, no big business idea makes sense at first.

Signalling, Subconscious hacking, Satisficing and Psychophysics.

we do not have full access to the reasons behind our decision-making because, in evolutionary terms, we are better off not knowing; we have evolved to deceive ourselves, in order that we are better at deceiving others.

‘Human nature hasn’t changed for a million years. It won’t even change in the next million years. Only the superficial things have changed. It is fashionable to talk about the changing man. A communicator must be concerned with the unchanging man – what compulsions drive him, what instincts dominate his every action, even though his language too often camouflages what really motivates him.’

For a business to be truly customer-focused, it needs to ignore what people say. Instead it needs to concentrate on what people feel.

That loss of power and control can create far stronger feelings of annoyance than the loss of punctuality.

If a problem is solved using a discipline other than that practised by those who believe themselves the rightful guardians of the solution, you’ll face an uphill struggle no matter how much evidence you can amass.

‘It is difficult to get a man to understand something, when his salary depends on his not understanding it.’

It seems likely that the biggest progress in the next 50 years may come not from improvements in technology but in psychology and design thinking. Put simply, it’s easy to achieve massive improvements in perception at a fraction of the cost of equivalent improvements in reality.

We are wrong about psychology to a far grater degree than we are about physics, so there is more scope for improvement. Also, we have a culture that prizes measuring things over understanding people, and hence is disproportionately weak at both seeking and recognising psychological answers.

the fact that sensible people never ask questions of this kind is exactly why you need to ask them.

You will never uncover unconscious motivations unless you create an atmosphere in which people can ask apparently fatuous questions without fear of shame.

just because there is a rational answer to something, it doesn’t mean that there isn’t a more interesting, irrational answer to be found in the unconscious.

There are many spheres of human action in which reason plays a very small part. Understanding the unconscious obstacle to a new behaviour and then removing it, or else creating a new context for a decision, will generally work much more effectively.

Whether we use logic or psycho-logic depends on whether we want to solve the problem or to simply to be seen to be trying to solve the problem.

people are impressed by any visible extra effort that goes into a product:

As far as evolution is concerned, if a behaviour is beneficial, we can attach any reason to it that we like.

If you confine yourself to using rational arguments to encourage rational behaviour, you will be using only a tiny proportion of the tools in your armoury. Logic demands a direct connection between reason and action, but psycho-logic doesn’t.

How You Ask the Question Affects the Answer

the more data we have, the less room there is for things that can’t easily be used in computation. Far from reducing our problems, technology may have equipped us with a rational straitjacket that limits our freedom to solve them.

parallel average tells you nothing about the series expectation. Put in mathematical language, an ensemble perspective is not the same as a time-series perspective.

many supposed biases which economists wish to correct may not be biases at all – they may simply arise from the fact that a decision which seems irrational when viewed through an ensemble perspective is rational when viewed through the correct time-series perspective, which is how real life is actually lived; what happens on average when a thousand people do something once is not a clue to what will happen when one person does something a thousand times.

every time you average, add or multiply something, you are losing information. Remember also that a single rogue outlier can lead to an extraordinary distortion of reality

Many other mathematical models involving humans make the mistake of assuming that 10 x 1 = 1 x 10.

If you want low variance, it pays to hire conventionally and adhere to the status quo,

you can either create a fairer, more equitable society, with opportunities for all but where luck plays a significant role, or you can create a society which maintains the illusion of complete and non-random fairness, yet where opportunities are open to only a few – the problem is that when ‘the rules are the same for everyone’ the same boring bastards win every time.

‘Find one or two things your boss is rubbish at and be quite good at them.’ Complementary talent is far more valuable than conformist talent.