Sleights of Mind

Faris
4 min readMar 22, 2021

Despite increased awareness of behavioral economics in the industry, little advertising is shaped by using it. Does the future lies in attention economics instead.

In 2011, Jim Stengel, former CMO of Procter & Gamble, published his book Grow. In it, he analyzed 50 brands with the highest Millward-Brown loyalty scores to determine what might connect them. His answer was brand purpose, the shared intent of everyone at the company to improve lives. He compared this Stengel 50 index with the S&P 500 between 2000 and 2011 and saw that his index had grown 393% compared with a 7% loss in the S&P. It seemed that brand purpose was driving significant alpha (the financial term for outperforming the market).

The idea spread influentially. Marketers and agencies suddenly found themselves seeking out their brands’ higher purpose to inform communications in the hope of driving outsized returns.

However, a book by Richard Shotton called The Choice Factory contains a robust rebuttal of the thesis. In it, among a number of challenges, he points out that in the five years following 2011, only nine of the brands outperformed the market, which suggests that “ideals weren’t the panacea Stengel suggested”.

Companies should rise above just making money and have a higher purpose — to galvanize employees, guide decisions and because it is the right thing to do, not because it creates more profitable brand communication.

Why then did so many ad folk leap upon this idea without subjecting it to sufficient rigor? Because of what psychologists call wishful seeing and motivated reasoning. Purpose appeared as a simple rule, applicable across categories, that seemed to imbue advertising with a moral purpose, all of which are pleasing ideas to hard-working practitioners.

Despite increased awareness of behavioral economics in the industry, little advertising is directly shaped by using it. Shotton’s book covers 25 scientifically demonstrated biases that can inform better advertising. Some have been used intuitively for years, like the power of social proof to persuade people, as reflected in all claims of popularity, such as the…

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Faris

Hello! I'm Faris. I'm looking for the awesome. Founder/Genius Steals. Itinerant Strategist//Speaker. Author of Paid Attention.