A few weeks ago, I published, with slight trepidation, an article called, Bonfire of the Vanities: Time to Burn Behavioural Economics. I argued that, although a useful discipline in many ways, BE may have pandered to the vanity of marketers by (apparently) giving them the power to change consumer behaviour. And I speculated that it might be diverting marketers’ attention away from what should be their central purpose: building sustainable value for their clients, not just quick fixes that produce sales uplifts in the short term. I ended the piece by posing a (rhetorical) question:
What does Behavioural Economics tell us about how to build brand value over time?
Fair to say that it generated quite a bit of controversy, with comments falling broadly into three categories:
1. I’m glad someone has said this at last
There’s clearly some disquiet about the role of BE – particularly in advertising circles. One strategy director described it as a “grab bag of parlour tricks, with little application to the problems clients ask us to solve”. A neuroscience researcher commented that “BE is the new Wild West, led by knowledgeable people but with lots of snake oil sellers…”
Interestingly (or suspiciously if you’re conspiratorially minded) several responses came in via private messaging. Which made me wonder: Are the naysayers of BE like Christians in ancient Rome, secretly signalling their allegiance to a dangerously subversive point of view?
2. It’s all a question of definition
Of course it is. Several well-meaning (and obviously well read) commentators pointed out that there is a “lot more” to BE than biases and heuristics and warned against over simplistic or reductionist interpretations. Valuable as I found their comments, I sensed a deep reluctance on their part to say exactly what BE is. It does seem there’s a lack of inter-connectivity in BE and no over-arching theory pulling the whole thing together.
What is clear is that the definition of BE is sometimes unclear.
3. Surely, you’ve read Blenkinsop & Snodgrass?
Back in the day, there was a guy who haunted the annual MRS conference. His speciality was to leap up at the conclusion of a session and declare: ” Very interesting presentation, first class in fact. But, I wonder, have the speakers read the latest paper on this subject by Blenkinsop & Snodgrass?”. At which point the visibly crestfallen speakers would stammeringly admit their ignorance of this seminal tome. And so one erudite BE practitioner commented on my piece by trotting out a string of references and caveats before admitting – in response to my rhetorical question – that BE was not “supposed” to answer the question of how to build brands. Another, in similar vein, accused me of taking aim at a “straw man”. Aha!
And while we’re on the subject of straw men, I’ve never come across an economist who regards “ homo-economicus” – the nemesis of BE – as an empirical fact. It’s simply not true that, prior to the advent of BE, all economists saw the consumer as a hyper-rational utility-maximiser. What BE has brought to the table, however, is a useful counterpoint to traditional economics, based on bounded rationality. And I for one welcome that.