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The Marketing Secrets Apple & Tesla Always Use: Rory Sutherland | E165
50 segments available
Rory Sutherland is the author of Alchemy, a senior advertising executive, and the man who understands why some ideas connect with people and some ideas don’t. He’s a columnist, an innovator and a trailblazer in the world of marketing and advertising. 0:00 Intro 02:07 The concept of how we value things 18:56 Recursive Trends 23:42 The brain's marketing function: Signalling 34:43 technology making location irrelevant 41:07 making something bad to give it value 48:14 Scarcity of product 51:38 Personalisation 56:37 How to deliver a product to the world 01:02:59 Why business are focusing on the wrong thing 01:11:00 Personal branding 01:17:25 Why do you think you successful 01:33:43 The last guest question Rory: https://twitter.com/rorysutherland?s=20&t=4azefUUEPFOUa986gpwmeg Rory’s book: https://www.amazon.co.uk/Alchemy-Surprising-Power-Ideas-Sense/dp/0753556529 Listen on: Apple podcast - https://podcasts.apple.com/gb/podcast... Spotify - https://open.spotify.com/show/7iQXmUT... FOLLOW ► Instagram: https://www.instagram.com/steven/ Twitter: https://twitter.com/SteveBartlettSC Linkedin: https://www.linkedin.com/in/stevenbartlett-123 Sponsors: Huel - https://my.huel.com/Steven Crafted - https://bit.ly/3JKOPFx
Segments Timeline
The Power of Perception in Marketing
Rory Sutherland discusses how psychological insights can enhance customer satisfaction and perceived value. He emphasizes that improving experiences, like making journeys enjoyable rather than just faster, can create significant value. This segment highlights the importance of understanding human psychology in marketing strategies.
"I think the NHS could create massively greater patient Satisfaction by deploying certain behaviors and techniques like what well Rory Southerland he is an author columnist and the vice chairman of Aug..."
Psychological Moonshots: The Uber Map
Sutherland shares the concept of 'psychological moonshots' using the Uber map as an example. He explains how the map alleviates the stress of waiting for a taxi by providing real-time information, transforming the waiting experience. This segment illustrates how marketing can leverage psychological insights to enhance user experience.
"when you create perceptual value you are creating value value can be created in the mind every bit as much as it can be created in the factory and I think there was a an unfortunate story about market..."
Trust and the Knowledge of Black Cab Drivers
In this segment, Rory discusses the trust factor associated with black cab drivers in London and how their extensive knowledge creates a sense of reliability. He contrasts this with modern navigation technology, exploring the implications of trust in service industries and how it affects consumer behavior.
"just with marketing and advertising but what I'm always very fond of is I think the Uber map is a psychological moonshot and it's based I mean the the story which may or may not be true is that one of..."
The IKEA Effect: Value Through Effort
Rory explains the IKEA effect, where consumers perceive greater value in products they have assembled themselves. He discusses how this principle applies to various products and services, including meal kits, and how perceived effort can enhance consumer satisfaction and trust.
"interesting is that the quantity of waiting is the same with or without a map you know in pure quantitative measured SI unit terms of time and duration no difference the quality of the waiting is tota..."
The Counterintuitive Nature of Value
This segment delves into the counterintuitive aspects of marketing, where making a product more difficult to obtain can increase its perceived value. Rory uses examples from low-cost airlines and IKEA to illustrate how narratives around effort and cost can influence consumer perceptions.
"of the things and I have to go out into a field and pick the things myself cheap strawberries by contrast May create some degree of uncertainty because you look at the market and go well if these stra..."
The Gusto Experience: Cooking Made Easy
Rory shares his experience with meal kit services like Gusto, highlighting how they create a restaurant-quality meal at home with minimal effort. He discusses the appeal of these services and how they leverage the convenience of pre-portioned ingredients to enhance the cooking experience.
"suppose the earliest manifestation of this although it's sometimes called the Ikea effect was a very famous marketing case study um for Betty Crocker cakes where they had a cake mix where you just add..."
The Quooker: Instant Gratification in Cooking
In this segment, Rory discusses the Quooker, an instant boiling water tap, and the paradox of its high cost versus convenience. He reflects on how experiencing such innovations can change consumer habits and perceptions of value in everyday cooking.
"to remain abundantly available so I said sure you know absolutely I'm delighted the other thing is I probably ordered a Gusto box for um the only reason we stopped was actually we had our kitchen repl..."
The Slow Adoption of New Technologies
Sutherland explores the initial slow growth of new technologies, emphasizing the importance of social habits and peer influence in their adoption. He uses the example of mobile phones to illustrate how societal perceptions can hinder the acceptance of innovative products.
"now okay half of me you know perhaps the more puritanical rational half is going you've just paid not quite a four-figure sum but a very large figure some for a very fast Kettle and the other half of ..."
The Music Industry's Misunderstanding
Rory shares insights on the music industry, recounting a conversation with an HMV CEO who underestimated the shift in consumer behavior away from physical CDs. He explains how convenience and accessibility have reshaped music consumption, leading to the decline of traditional formats.
"nearly anything significantly new starts off fairly Niche yeah yeah and the reason is that the two driving forces of human behavior are habit and social copying and therefore when you've never done it..."
The Rise and Fall of CD Culture
In this segment, Sutherland discusses the resurgence of vinyl records and the decline of CDs, highlighting the cultural and emotional connections consumers have with different music formats. He reflects on the irony of nostalgia driving the revival of vinyl while CDs fade into obscurity.
"might make a point by the way that in terms of its if someone has a design sensibility in terms of its proliferation the CD laughably named jewel case the plastic hinge case in which the CD came was p..."
The Rindless Cheddar Paradox
Rory illustrates the concept of recursive trends in marketing through the example of cheddar cheese. He explains how the introduction of rindless cheddar created a premium market, only for consumers to later seek out artisanal cheeses with rinds, showcasing the cyclical nature of consumer preferences.
"not just a case of like scarcity yeah I I well I suspect one of the one of the curses of capitalism is that is recursive fashion exactly uh so um Jeremy bulmore who's now I suppose in his late 80s won..."
Counter-Signaling in Fashion
Sutherland delves into the concept of counter-signaling in fashion, where individuals with status choose to dress down to convey confidence. He discusses how this behavior reflects broader trends in consumer behavior and marketing, particularly in the context of luxury brands.
"isn't advertising because what you're saying that's the real key it's it's it's human partly human neophilia so that what's different attracts our attention Okay so undoubtedly we disproportionately p..."
The Psychology of Status Signaling
In this segment, Rory examines how humans engage in status signaling through consumption choices. He contrasts practical purchases with luxury items, emphasizing that wasteful consumption often signals wealth and status, while counter-signaling can indicate confidence and security.
"again maybe because of part of the term for this is sometimes counter signaling it was a bit like um hipsters drinking pabs Blue Ribbon ribbon I think it's called Uh which is it was historically down ..."
The Shift in Electric Car Perception
Sutherland discusses the changing perceptions of electric cars, noting that they are becoming status symbols among former luxury car owners. He highlights how the environmental aspect of electric vehicles is reshaping consumer identity and signaling in the automotive market.
"I don't think there's a case where animals do this is they also practice something called counter signaling which is showing that you don't have to try because you're confident enough in your other at..."
Psychological Value Over Rational Improvement
Rory concludes by emphasizing the importance of psychological value in marketing. He argues that enhancing customer experience through psychological means can be more effective than purely rational improvements, advocating for a deeper understanding of consumer emotions in business strategies.
"to own less yes because I don't have things I don't have a watch I don't have as I said to you I have an electric bike which you've just seen like I to be fair I do have a nice Cut um car that they dr..."
The Power of Perception in Marketing
Rory explains the concept of 'vegan leather' as a clever marketing strategy that reframes plastic seats in cars as an environmentally friendly choice. He discusses how psychological perceptions can create value and influence consumer choices, emphasizing that marketing can perform 'magic' in shaping how products are viewed.
"exploration than what you might call rational Improvement don't make the Eurostar faster make the journey more enjoyable okay put Wi-Fi on the trains serve better food okay it's a cheaper way actually..."
Overcoming Range Anxiety
Rory addresses the psychological barriers to electric car adoption, particularly range anxiety. He explains how this fear can lead to unnecessary competition on range specifications, ultimately complicating the consumer experience and hindering the growth of electric vehicle sales.
"the cleverest reframings you can do an aspirational Choice as indeed so yeah no and so you know I I ABS you know I look at things like range anxxiety and I get that's psychological okay what's that ok..."
Innovation Through Disruption
In this segment, Rory reflects on how periods of crisis can lead to innovation and reduced risk aversion in businesses. He draws parallels between historical economic disruptions and the current landscape, suggesting that challenges can foster creativity and new approaches in marketing and business strategies.
"because there there are these products exactly like Gusto or hellofresh which once you experience them 50% of people become a convert but the real marketing challenge is well that's fine that's great ..."
The Irrelevance of Location in Modern Work
Rory discusses how technology has made location irrelevant for work, contrasting it with the focused environment of traditional office settings. He shares personal anecdotes about the challenges of maintaining focus while being constantly connected, highlighting the downsides of remote work and the importance of spontaneity in life.
"I mean I I I I I'm a huge Dev more so than you I I know you've got a very intelligent approach to flexible working which is yeah that's what I wanted to talk about is yeah yeah but but it was interest..."
Changing Consumer Behavior
Rory examines how businesses can influence consumer behavior by changing perceptions and meanings associated with products. He references historical figures like Henry Ford and discusses the importance of leisure in driving consumer demand, suggesting that companies should adapt their strategies to foster new consumer habits.
"know my my wife and I discovered New Mexico in just whole American St we knew it existed okay we discovered New Mexico more or less by accident we were on a driving holiday and we got stuck in El Paso..."
The Psychology of Product Design
In this segment, Rory explores the psychology behind product design, particularly in pharmaceuticals. He argues that making products easier to use can lead to forgetfulness and lower compliance, suggesting that adding a degree of difficulty can enhance user engagement and effectiveness.
"car and with their BNB if you think about it uh they stand to be fairly major beneficiaries of working from anywhere oh yeah so doing it with their own staff there was a rumor I'm not sure it's true s..."
Value in Friction
Rory discusses how introducing friction in processes can create value and enhance user experience. He shares insights on how travel websites use slower search processes to increase perceived value, illustrating the counterintuitive nature of consumer psychology in marketing.
"cool brand you know and this is why you know I wrote the book Alchemy partly saying we have a kind of culture in business particularly in the finance function of business which does which refuses to b..."
Taste vs. Nutrition in Product Success
Rory contrasts two successful protein bar brands, one focusing on taste and the other on nutritional completeness. He highlights how consumer preferences can vary and how brands can succeed by prioritizing different aspects of their products, emphasizing the importance of understanding consumer psychology.
"another good idea in Psychology you can actually uh you know there's Dyson and there's the Henry you know they're both strong vacuum CA brands in entirely different um uh directions if you like and th..."
The Role of Perceived Value in Marketing
Rory delves into the concept of perceived value in marketing, using examples from the pharmaceutical industry to illustrate how consumers respond to product attributes. He discusses how the perception of a product can be more influential than its actual qualities, reinforcing the idea that marketing is about creating meaningful connections.
"nutritionally complete and healthy and I've sat in the it's not repellent it's not absolutely not quite quite the opposite I would drink this perfectly content but you it it tastes good enough for you..."
The Value of Friction in Medicine
Rory Sutherland discusses how the design of pharmaceutical products can impact patient compliance and the placebo effect. He argues that making medications easier to take may lead to forgetfulness, while introducing a degree of friction, such as requiring preparation, can enhance the experience and effectiveness of treatment. This segment highlights the paradox of simplicity versus the value of effort in creating memorable experiences.
"and apparently when they do this they exaggerate the side effects because you feel that if it's to be tackling a much tougher challenge which is cancer you would expect greater side effects I mean you..."
Perceived Value Through Delayed Gratification
In this segment, Sutherland explains how travel websites intentionally slow down the search process to enhance the perceived value of the results. He illustrates that when users see a loading screen, they attach more significance to the eventual outcome, leading to higher booking rates. This insight reveals the psychological aspects of consumer behavior and the importance of perceived effort in marketing.
"interesting that this idea that friction can create create value but it also can can ingrain something in your routine the other thing that I I I think about a lot sometimes by the way some travel web..."
Creating Perceived Value in Dining
Rory Sutherland elaborates on how the ambiance and presentation of food in restaurants can significantly affect diners' appreciation of the meal. He argues that once basic food quality is met, factors like atmosphere and service become crucial in enhancing perceived value. This segment emphasizes the importance of creating an environment that elevates the dining experience beyond just the food itself.
"valuable is it a con so okay I mean if you take this whole question of how we perceive value you could undou you wouldn't disagree with the fact that the nature of a restaurant and how it's designed o..."
The Importance of Storytelling in Branding
Sutherland shares insights on how brands can enhance their value by effectively communicating their craftsmanship and heritage. He recounts his experience with a lingerie brand that failed to tell its story, leading to its downfall. This segment underscores the necessity of storytelling in marketing to differentiate products and create emotional connections with consumers.
"packaging um one of the things that I'm quite I I saw one of my favorite Brands the other day do a trip around their warehouse showing the warehouse and on one hand I love seeing the warehouse I love ..."
The Power of Personalization
In this segment, Sutherland discusses the nuances of personalization in marketing, highlighting both its potential benefits and pitfalls. He shares examples of how surface-level personalization can enhance customer experience but also warns against crossing privacy boundaries. This discussion emphasizes the delicate balance marketers must strike when personalizing interactions with consumers.
"so no one sees the craftsmanship I had no awareness of that either there you go and isn't that and I tell you what happened to laa they went bust and and and when I got when I seen in Italy just the u..."
Navigating Customer Privacy in Marketing
Rory Sutherland reflects on the fine line between effective personalization and privacy invasion. He shares personal anecdotes illustrating how different approaches to customer engagement can evoke varying reactions. This segment highlights the importance of understanding cultural differences and consumer perceptions in marketing strategies.
"you think about personalization and when I say personalization I really mean this the surface level personalization of tickling someone's ego by yeah I always talk about Starbucks them just writing yo..."
Delivering Value in E-commerce
Sutherland provides practical advice for launching an apparel brand, emphasizing the importance of customer service and transparency in e-commerce. He discusses the need for businesses to focus on removing negatives in the customer experience, such as offering delivery options and ensuring easy communication. This segment serves as a guide for entrepreneurs looking to create valuable customer experiences in the digital marketplace.
"and you can I mean it's very interesting because there's all you've also got to be very very alert to cultural differences so that Germans have a paranoia about data protection and privacy uh which is..."
The Art of Packaging and Presentation
In this segment, Rory explores the significance of packaging in branding and customer experience. He explains how the unboxing experience can enhance perceived value and brand identity. Sutherland uses examples from high-end retailers to illustrate how thoughtful packaging can create a lasting impression and contribute to the overall brand narrative.
"pain you know um and I think that is that's a fundamental failing this is a customer service point the importance of customer service right a few people I mean selfes do selfes do it pretty well okay ..."
Creating Scarcity and Value in Products
Rory discusses the strategy of creating scarcity in product offerings to drive demand. He shares insights from his own experiences with limited edition merchandise and how storytelling enhances the perceived value of products. This segment emphasizes the importance of crafting a compelling narrative around products to engage customers and encourage purchases.
"um you know a kind of an implied target audience and so in in this thing now the interesting thing is how are you going to uh what's your stick do you have for example scarcity is the clothing availab..."
The Balance Between Brand and Performance Marketing
Sutherland delves into the ongoing debate between brand marketing and performance marketing. He argues that businesses often overemphasize quantifiable metrics at the expense of long-term brand loyalty. Rory highlights the need for a balanced approach that values both immediate sales and the cultivation of brand reputation over time.
"but in the broader engagement to no I mean this is this is actually the great curse of a lot of modern business given the title of your um podcast which is that people generally over obsess about thin..."
The Importance of Repeat Purchases
In this segment, Rory emphasizes the significance of repeat purchases as a key metric for business success. He discusses how understanding customer loyalty and lifetime value can inform marketing strategies. Sutherland argues that businesses should prioritize optimizing the customer experience to encourage repeat business rather than solely focusing on new customer acquisition.
"quantify on that particular point then having worked in the advertising industry this is a conversation we have all the time with clients which is you'll meet a certain type of client who is very uh w..."
The Role of Fame in Brand Success
Rory explores how brand fame can influence customer behavior and perceptions. He discusses the advantages that well-known brands have in terms of customer forgiveness and price sensitivity. This segment highlights the complexities of measuring brand impact and the benefits of establishing a strong brand identity.
"understand I think in a market is to what extent does your uh product actually convert someone to something and then the lifetime value so You' start with repeat purchase then you go to conversion and..."
Personal Branding in the Digital Age
Sutherland reflects on the rise of personal branding in the age of social media. He discusses how individuals can leverage platforms like Twitter and LinkedIn to build their personal brands and influence. Rory emphasizes the value of sharing knowledge and experiences to connect with audiences and enhance one's professional reputation.
"budgets than us not necessarily rightly but they were also you know much more indulged than we were because they didn't have to prove Effectiveness down to the same sort of level of statistical signif..."
The Value of Unpaid Influence
Rory Sutherland discusses the paradox of value in advertising, emphasizing that some of the most valuable contributions in his career come from unpaid efforts, such as sharing knowledge and connecting people. He critiques the traditional hourly billing model in advertising, arguing that the true worth of ideas cannot be measured by time alone.
"way on the show absolutely fantastic but what has been absolutely fantastic is that um uh you know he's a glorious advertising mind I mean just an absolute ornament to the industry and he through Twit..."
Vaping and Behavioral Insights
Sutherland shares his experience with vaping and its implications for public health. He highlights the importance of understanding human psychology in marketing and how electronic cigarettes can serve as a harm reduction tool, while also addressing the regulatory challenges they face.
"reciprocity would say otherwise I know I suppose you've just got to rely on a high degree of reciprocity in some respect I mean it always it always bothers me about this which is that we're in a busin..."
The Importance of Personal Branding
Rory emphasizes that everyone has a personal brand, whether they acknowledge it or not. He argues that effective marketing is essential for presenting oneself and one's products attractively, and that self-awareness is a key component of a strong personal brand.
"second thing you got to be alert to is that because of peculiar human psychology half the people in the what you might call the health and anti-smoking Lobby will be fanatical about banning electronic..."
Connecting the Dots of Success
In this segment, Sutherland reflects on the factors contributing to his success in the marketing industry. He discusses the value of diversity in thought and experience, and how maintaining a degree of skepticism can foster innovation and creativity.
"say that the personal brand requires sacrifice you know that old that old saying that strategy is the art of sacrifice but way not totally true I think there are win-wins you know what is the sacrific..."
The Role of Communication in Success
Rory discusses the critical role of communication and storytelling in achieving success. He argues that the ability to articulate ideas effectively can create opportunities and inspire others, highlighting the need for better communication skills in education.
"successful um I think um and by the way this is also an argument for you know ethnic cognitive all kinds of diversity I really really love the Avatar and marketing industry I think it's a source of en..."
The Art of Engaging Storytelling
Sutherland explores the nuances of storytelling in communication, emphasizing how engaging narratives can captivate audiences. He shares insights on how effective speakers use ambiguity and curiosity to draw listeners in and maintain their attention.
"the law of averages okay so the timing is one issue but the other issue is that maybe the really Innovative product require some component of nonsense I don't mean nonsense but I mean nonsense you kno..."
The Power of Narrative in Marketing
In this segment, Rory discusses the significance of narrative in marketing and how it can enhance perceived value. He critiques the lack of storytelling skills among entrepreneurs and advocates for teaching effective communication in schools.
"introduce a point you introduce it with a compelling slightly ambiguous story so even you'll you'll start it with that and then the next sentence leads me up to you're almost making me a promise that ..."
Applying Marketing Principles to Public Sector
Sutherland proposes that marketing principles can be applied to improve public sector services, such as the NHS. He suggests that understanding human behavior and communication can lead to greater patient satisfaction and better decision-making in government.
"that a lot of people don't introduce the first concept in the sentence as being something slightly ambiguous and unusual which inspires curiosity via engagement so it's it's an interesting it's probab..."
The Value of Real-World Experience
Rory critiques the current educational system, arguing that real-world experience can be just as valuable, if not more so, than formal education. He discusses how societal norms have shifted, making a university degree a necessity for job entry, and suggests that allowing people to work before attending university could lead to better outcomes and a more diverse workforce.
"okay but um like what well I I'll give one example I think you could actually reframe waiting time for an operation in some cases as preparation for the operation so if that time can be put to good us..."
The Myth of Higher Education
In this segment, Sutherland reflects on the changing perception of higher education and its impact on career opportunities. He argues that the expansion of higher education has made degrees necessary but not sufficient for success, and he shares personal anecdotes to illustrate how practical experience can enhance one's understanding and capabilities in the workforce.
"to quit the queue I think another one i' do is i' I'd reduce student loans significantly if people had worked for one or two years before they went to University I think that I think that could be a m..."
The Success of Dropouts
Rory discusses the phenomenon of successful dropouts, citing examples like Bill Gates and Mark Zuckerberg. He argues that the narrative surrounding education often overlooks the value of practical experience and suggests that many individuals could thrive without a traditional educational path, challenging the conventional wisdom about the necessity of degrees.
"now I think if you reserved a whole load of University places or you discounted University places for people who'd worked somewhere first some of these people may well find out that they love the busi..."
Venerating Comedians and Their Insight
Sutherland shares his admiration for comedians, highlighting their unique perspectives and ability to challenge societal norms. He argues that comedians should be free to express themselves without censorship, as their nuanced understanding of the world can provide valuable insights that are often overlooked by political activists.
"have this extraordinary narrative that education adds to people's human capital okay and that somehow the second you start work you know you become just you know you learn nothing this is completely t..."
Inspiration from Comedy
In this closing segment, Rory reflects on the influence of comedians in his life and how their work inspires him. He emphasizes the importance of creativity and humor in communication, expressing gratitude for the opportunity to discuss these ideas and the impact of his book on the marketing and advertising industry.
"question for the next guest yeah um and this guest has written a question for you now their handwriting is not good so this is I've been staring at this for about 15 minutes trying to figure out what ..."