Category Archives: Business

Do More Choices Really Make Us Happier? Choice Paradox and Human Decision-Making.

The other day I was out at a greasy spoon for breakfast. I was half asleep and happy to see there were only two items on the menu. Nice and simple, I don’t have to think, just have to choose option 1; standard breakfast, or option 2; omelet. Oh but how wrong I was!

Here is a rough memory of my conversation with the waitress:

Waitress: “What would you like to order?”

Paula: “Standard breakfast please”

Waitress: “How would you like your eggs? Scrambled, over easy, sunny side up, fried, well done, boiled or poached”?

Paula: “ummmmmm, over-easy”

Waitress: “How would you like your toast? White, brown, rye, whole wheat or a bagel?

Paula: “ummmm, brown”

Waitress: “Would you like bacon, sausage, felafel or back-bacon?

Paula: “oh man, I guess bacon”

Waitress: “Would you like coffee, tea or orange juice?”

Paula: “oh um, I think tea”

 Waitress: “Green tea, black tea, mint tea, herbal tee, decaf tea?

Paula: “Black tea”

I don’t even like my eggs over-easy and I much prefer rye toast over brown toast. So why would I order them? The overwhelming number of choices for each aspect of my breakfast made it difficult for me to choose what option I actually wanted. I felt overwhelmed by all the options and felt pressure to choose quickly since I was at a restaurant. The result, I pretty much picked at random just to be finished with the process. And then was unhappy with the result.

Now this abundance of choice is not solely breakfast’s fault. Products are being offered in a huge variety of options across almost every consumer industry. According to my own math Lays offers 39 different flavours of potato chips in the United States. Walmart carries 60 different types of toothpaste, Old Navy offers 206 different types of women’s jeans and Starbucks boasts that they offer over 87,000 different drink combinations.

laysThis constant expansion of choice seems to be based on the idea that more is better and that choice equals freedom. Or companies think the more they make, the happier people will be and therefore, the more they will buy. But does all this choice actually make us any happier? At what point does too much choice actually equal restriction and even stress?

The Jam Study

A study conducted in 2002 by professors at Columbia University and Stanford University tested this relationship between choice and purchase. In a series of high-end groceries stores in the United States the study set up two different gourmet jam tasting stations. The first jam station offered 24 jams to taste while the second offered only 6 jams.

The percentage of people who stopped to taste the jams?

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The percentage of people who actually purchased a jam after trying one?

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Interestingly enough this study seems to suggest people don’t actually like choice, they like the illusion of choice, but ultimately find too many choices difficult to deal with. In fact in the Behavioural Economics’ sphere this is referred to as Choice Paradox (or the Paradox of Choice) since an abundance of choice often renders people unable to choose effectively. Barry Schwarts, author of the Paradox of Choice; Why More is Less, explains that an abundance of choice makes people overwhelmed, stressed and anxious. Schwarts goes as far as to say “Unconstrained freedom leads to paralysis”. Emphasizing that the increase of choice leads to the decrease in ability to make effective decisions.

So what is it in our decision-making that makes choice so stressful for humans? Dr. Russel James from the Texas Tech University explains it best, “Choice and our satisfaction are driven by the comparisons we make”. Basically, as our choices increase we have to make more and more comparisons, and this increase in comparisons leads to lower satisfaction because we can’t tell which option is actually better. Think of this way:

Which ice cream flavour would you choose?

icecreammsimple2

Easy, right? And most likely you eat the ice cream and be happy with your choice.

Now which ice cream flavour would you choose?

Icecream2

Humans just hate making decisions, its stressful, it is hard work and it has consequences. As the number of choices in any situation increases it forces our brain to work harder to evaluate all of the options. We try to compare every option available and recall past decisions for similar situations.

As we have noticed the number of choices available in any one industry is insane. Can you imagine having to evaluate 87,000 different drink combinations at Starbucks before ordering?

So what do humans do when faced with vast choice? How do we survive in a world of over whelming options? It seems as if our coping mechanism for vast choice situations is to choose something familiar to us. We might buy the exact same drink at Starbucks each time or alternate between three we know well. This appears to help our brains because it relieves the need to evaluate all of the options available. As Dr. James explained it also makes us happier because it removes the risk for potential disappointment from a new choice.

There are of course some brands who have figured this out. Even Costco themselves – the Kings of choice – have started to slim their offerings. In an article by the New York Times, Costco CEO explains that the company has tuned into the fact that, “Selling fewer items increases sales volumes…”. One of their newer company philosophies is to sell a limited number of items. While Walmart sells 60 types of toothpaste, Costco only offer 4 toothpaste options.

The most interesting part about Choice Paradox is that it backs up why humans like to choose from three choices, as we discussed in last weeks blog. It is widely believed that the Centre Stage Effect is most effective when 3 options are presented and becomes less effective as the number of choices increases. If we include Barry Schwartz studies, at some point in increases choices people just begin to choose at random and no longer are influenced by a Centre Stage Effect. However my guess is that Social Proof could still play a part in human decision making even when a large number of options are offered.

Which ice cream flavour would you choose?

Icecream

In all of this it is not say choice is important to humanity and that people shouldn’t try new things. It is just to talk about and explain how excessive choice puts stress on our brains and can make us feel as if we are in a Choice Paradox. We seem to like the idea of vast choice but dislike actually having to pick from vast options. Another example of the humans brain irrationality.


More Reading and References

http://www.businessinsider.com/costco-is-the-anti-walmart-2012-11#ixzz3IEDrPrte

http://www.patriotledger.com/article/20140930/BUSINESS/309309952/12335/NEWS?template=printart

http://www.ted.com/talks/barry_schwartz_on_the_paradox_of_choice/transcript?language=en 

http://www.economist.com/node/17723028

http://www.jeremysaid.com/customers-will-choose-middle-offer/

http://www.slideshare.net/rnja8c/paradox-of-choice-2139360

Total is committed to better energy, but is it committed to better commercials ?

Total SAOn today’s Bad Marketing, we are looking at the new commercial for Total, a French multinational, which is one of the six major players in the oil industry. They have been on the news lately due to the recent passing of their CEO, Christophe de Margerie in a plane crash at the Vnukovo Airport of Moscow in Russia. They only have 415 gas pumps in North America, but have almost 15.000 employees working in the oil, gas, solar and petrochemical industries.

On a more positive subject, Total is currently using the “Committed to better energy” campaign with its hashtag #MakeThingsBetter.Total and Publicis Agency have partnered together since their 2013 deal. According to its site, Total has launched this campaign in more than 20 different countries to improve awareness and growth objectives.

You know what also happened this last decade in more than 20 different countries? 59 oil spills. That said, Total has a lot to do to be seen as a positive company. As the oil industry isn’t the most transparent, they still have to respect legislation of each country they are working in. But as different countries means different laws, most of the time the whole oil lobby industry works in the shadows of government to make sure that different laws aren’t going in opposite directions.

With improvements in technology, more information on a geological scale has been obtained and also helped engineers to build stronger and more flexible materials in the construction of their refineries and pipeline. It helps engineers immensely, allowing them to make the best and cleanest industry as possible. Unfortunately for them, they still live in an unappreciated industry.

I’ll be honest, Total and friends aren’t my favourite companies on earth. Oil is unfortunately quite essential to most people everyday. Our population is growing, and thus our needs expand accordingly. Changes aren’t coming fast enough, and the fast-paced growth of the BRICS (Brazil, Russia, India, China and South Africa) are making things harder as they represent almost 3 billions people. But to multinationals, a growing population means more customers and more demand.

To make an impression, Total has decided to show us that they care as much as we do, or at least as we all should, by releasing a new commercial to promote their services and seriousness. Since many people have concerns about Total’s activities, they decided to show different places of work across the globe to demonstrate how things work in this industry.

The first thing you’ll notice is the music. Total have used the song “Roadgame” from the French artist Kavinsky to amplify the motif of young and active people in the commercial. With electronic music ensuring a fast-paced commercial, different people are telling, looking straight at the camera, that it is “not a question of place” nor “of temperature” nor “of dedication” because “it’s not a question at all”. “Energy has to be better” because “it is our responsibility” and “our commitment” “to make it better” “for all of us”. By saying this in that way, Total is hoping to unite us, while making us emotionally connected to the company. They display different people with different origins at different locations which amplifies the statement “for all of us”.

It appears that they wanted to use Total employees to be brand ambassadors to make the multinational closer to every employees on Earth. The things is, it sounds fake.

In my opinion, they forget one crucial thing: most people are not big fans of the oil industry, and having some statement that they are doing a good job because of their commitment to #MakeThingsBetter doesn’t feel natural. To me, this commercial raises more questions than ever. How are Total making it better? What does total define as your responsibilities? Is Total truly improving our lives?

I get that using “employees” from all around the world might sounds like a good idea to show that the whole group is working together on this goal, but it feels unnatural. To be clear, I feel it is more like a propaganda film that you want to show at a presentation to recruit people. And I am sorry, but making a statement isn’t enough. I truly believe that we are more aware of what surrounds us, so no matter how committed the people in the commercial are to their jobs, I don’t buy that they are making something better.

I understand that Total needs to do some public relation from time to time to show their goodwill, but not like that. No matter what they say, they are working in a high profit and dark industry. Despite what they are saying on their social media with the hashtag #MakeThingsBetter, they aren’t truly delivering the truth. They need to be more inspired than that. A statement isn’t enough, and Total did it better before including with this one:

In short, Total is a major player in a industry that makes billions every year. In 2012, Total netted $13.35 billion, which represent a $36.5 million profit every single day. That same year, they have been fined for the oil spill of the Erika Tanker which sank near the Breton coast in France to $213 millions. In 6 days, they got their money back. That said, to make us believe in their commitment, we need more than statements like that. They have to show what they are actually doing, what they are bringing to the world, and what exactly they are improving. Otherwise, Total just reeks of disingenuous propaganda like in this ad.

Video of the Week – The Boy Who Beeps by GE

‘Weird yet awesome, and interesting but still confusing’ – the thoughts that went through my mind while watching GE’s new video.

This short video talks about an epic tale of a boy who only beeps and can communicate with machines. As he grows older, he discovers his capabilities and what he can do. His special powers allows him to speak with the machines that surround him. When “the boy who beeps” converses with the machines, he is making them work better that benefits everyone.

GE tells a powerful and poignant story about the abilities and capabilities of their Industrial Internet who speaks the language of industry. The ad is designed to evoke emotions surrounding the evolution of GE and how Industrial Internet business brings software and machines together to serve various industries. Additionally, they effectively portray a vision where all machines and IT systems can communicate efficiently together. Yet having a human, the little boy, embodying the language of the industry is a symbol of GE: that they are people that are doing this and not robots! It is edgy, distinctive and vividly brilliant.

At the end of the video they quote: “When you speak the language of industry, the conversation can change the world.” GE is winking at us, saying when you’re GE and you create things such as the Industrial Internet (AKA the Internet of Things), they’ll change the way we communicate with machines, and these communications are changing the world.

We especially like how they’ve created an evocative, sentimental view of a world where we can communicate with our machines. The “boy who beeps” is fluent in machine and human languages, whereas everyone else in the ad are constantly frustrated with their machines. The Internet of Things, or as GE is calling it, the Industrial Internet, is meant to make machines work for us in a much more cohesive manner than ever before. This ad makes us excited to see how well it will work!

The Human Brain is Irrational. How Behavioural Economics Explains Our Irrational Behaviour

Imagine right now you are craving chocolate and these are the offers available;

Lindt

A Lindt truffle for 15¢ or a Hershey’s Kiss 1¢. Which would you choose?

My guess is you would pick the 15¢ Lindt; it’s a good deal. You probably realize a 14¢ difference in price is a lot better deal than a supermarket would offer. In your mind it’s worth an extra 14¢ for the better chocolate. Now imagine the price is reduced by 1 cent. There is still a 14¢ difference between the chocolates but now the Lindt is 14¢ and the Hersey Kiss is free. Which would you choose now?

Duh, the free one!

A study at MIT conducted just this experiment and found that people overwhelmingly chose the Lindt in the first example and the free Hershey’s Kiss in the second example. This directly contradicts what economics teaches us. There is no change in the relative cost of two examples, the difference is 14¢ in both examples and therefore people’s preference should not change. But it did.

This study was conducted as part of a larger experiment on human decision-making. For years traditional economics has been the dominant theory regarding financially decision making, informing us that humans always make logical, self-serving, and rational decisions based on carefully reviewing the cost and benefits of each option presented. As advertisers we all intuitively know that this is not true. We all know that “buy one, get one free” works a lot better than “50% off if you buy two”.

Like advertisers, the human brain doesn’t concern itself with the laws of traditional economics. In reality the human brain is irrational. So irrational that at first it is hard to understand and predict. So, as advertisers, what tools exist to help us predict actual human behaviour?

Enter Behavioural Economics. It’s a relatively new field of combining Psychology and Economics to better understand how humans actually make decisions. Part science and part art, Rory Sutherland of Ogilvy Change calls it, “…closer to weather prediction than conventional science”. Behavioral economics is not about what people want to do, or what they tell others they will do. It is about what people actually do when faced with a decision in real life. Behavioural Economics takes into account things that effect behaviour such as mood, surroundings, peer groups, and even level of arousal. Looking at the human brain from this seat one begins to understand why free is infinitely better than 1 cent.

It is no surprise that this deep understanding of human behaviour is starting to make its way into the boardrooms of some of the largest advertising agencies worldwide such as Draft FCB and Ogilvy. I believe Behavioural Economics has a lot to offer advertising, as it is a great way to inject pure strategy into a naturally creative industry.

Follow my discussion of Behavioural Economics, my unorthodox experiments and my curiosity about the human mind in this weekly blog series. We’ll delve into the world of advertising strategy with a specific interest in how it can successfully be informed by Behavioural Economics.

This is the first article of a weekly series.


Sources: Shampan’er, K. & Ariely, D. Zero as a special Price, MIT. http://web.mit.edu/ariely/www/MIT/Papers/zero.pdf Halonen, E. In The Wild: Rory Sutherland, 2013. Indesion. http://indecisionblog.com/2013/03/18/in-the-wild-rory-sutherland/


Horse & Cart at WordCamp Mtl 2014

Screen Shot 2014-08-18 at 2.13.11 PM

Over the weekend, Horse & Cart attended the 2014 edition of WordCamp Montreal. For those unfamiliar with the conference, WordCamp is a weekend that brings together developers, designers, and writers, unified under the point of commonality that is WordPress. The conference is an event for talks, workshops, and networking to better one’s understanding on how to navigate and leverage WordPress and WordPress-related tools to sharpen your skills. The weekend was packed full of informative presentations and panels from industry leaders, assuring something for everyone.

Our very own digibomb was asked to speak on a panel that tackled making money with WordPress. He served as the agency voice among mostly freelance workers and answered transparently about the realities of determining price points, client relations, and WordPress strategy. The panel went notably well, giving way to a slew of audience questions and subsequent discussion. Defining the value of one’s work was arguably the largest takeaway, working either as a lone developer or agency. Everyone speaking did a strong job communicating their experiences in the workplace. Judging by the questions that followed digi out the door, it was clearly a burning topic. Two attendees with further questions for digi told us post-discussion that “the panel was pretty insightful” with one saying there was “more taken away from this panel than any other ones that I’ve been at today”. This was concluded with the conception of the newest digi-inspired hashtag, #lovethebeard.

There were also strong presentations on writing, and more specifically blogging. Liesl Barrell and Dan Levy of Unbounce allied together to break down and explain the various elements of effective writing, pitching, and promotion, using an impressive amount of “P” alliterations. As someone who always appreciates feedback, their advice was a strong motivator to continue pushing for personality in writing; Rules are meant to be broken (within reason), wordplay is an appreciated garnish, and red ink is your frenemy. One massive wakeup call was how trying to get into the perfect “writing zone” is by and large just another stalling tactic to keep you from hammering out your work. The talk was refreshing, especially given that both speakers were coming from complimentary positions as writers and editors.

All in all, the weekend was a smooth success. Everyone from the Horse & Cart team who attended took useful tips away that we all plan on incorporating into our practice. For those interested in learning more about WordCamp Montreal, you can check our their website here. We also managed to sneak a couple cool pictures, so please feel free to check out the others at our instagram for more of that fun. As always, if you have questions about marketing, agency life, or our operation here at Horse & Cart, drop us an email or come stop by the office for some coffee and a chat!

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Fun Friday Post: The most funniest examples of poor spelling and grammer

Proper spelling and grammar are unfortunately suffering skill sets. In most fields of work and study, fundamental to communicating your idea is being able to do so in legible, error-free English. This is especially true in the world of business marketing where bludgeoned websites, advertisements, labels, and even company names can leave your brand looking… in need of revision. Few things compare to the disaster of a confident company message lost entirely due to a blinding spelling error mid-text. We live in a time of short messages and shorter attention spans, and when many are faced with presenting their thoughts in written form, fewer and fewer are able to do so without fault. Bless spellcheck, but it is not and should never be a writer’s sole crutch. If it is, well, it will probably spell disaster later on (sorry). Here is a list of some of the more notable instances of corporate error.

1. Lands’ End

lands-end-young-jerks-1As the story goes, the misplaced apostrophe was an oversight when incorporating the company name. Now, the clothing brand has no choice but to stick out their chests and own it. Even if most people don’t pick up on the error, I can imagine the writer being tormented to the day having that silly mistake looking back at them, time and time again. source

2. Tesco Orange Juice

juiceAs recently as this year, Tesco was publicly called out by a grade school teen for using a double superlative–a big faux-pas. If you haven’t picked up on it already, I eloquently threw one into the title of this blogpost for effect. It’s a simple rule, nothing can be greater than the greatest, better than the best, or tastier than the tastiest. That is why “most tastiest” is a redundant overkill. source

3. Reebok’s Quick-Thinking
reebok-typo-500x375This one’s too good… This New York targeted subway ad was exploiting the “New York minute” expression, suggesting people take their time. In the same breath, they misspelled, “everything”. You just want to hold a mirror up to their own advice. Unless the error was somehow attempting to mimic the local dialect, I’m not buying it. Ah, the irony sustains me! source

 

4. Rachel Ray and Her Long-Lost Friend, the Comma.

rachelray01This example isn’t new, but it does serve as a classic example to show the importance of a comma. Commas are your friend. One tiny line at the foot of a word can change the entire meaning of a sentence. In this instance, the addition of a few commas would have saved the lives of Rachel Ray’s family and dog. Now, they are little more than another meal in Mrs. Ray’s kitchen. Rachel, you monster! source

Also see: “Let’s eat, Grandma!” vs. “Let’s eat Grandma!”

 

 

5. The unintentionally crass.

lbj_poster Take a second to read the bottom line of this commencement ceremony poster. The horror! This is a traumatic mistake that someone, I promise, has lost sleep over. Let this example serve as a warning for anyone writing copy for, or pitching to any person or institution who works with the public, or publics. Forgetting that one letter dramatically changed the orientation of this school. source

 

 

 

 

Moral of the story, put your pride aside and get a friend, coworker, or professional editor to examine your work. It’s not a sign of weakness or lack of ability to reach out for a second opinion. Don’t fall victim to poor communication!

*title errors are intentional 😉

Looking the Part

Doing What We Do Best. Google+ Expert Ray Hiltz Gets His Horse & Cart Website Overhaul.

hero-rayhiltz

Here is Rayhiltz.com, the sharp new internet face of Montreal-based Google+ consulting and strategy expert, Ray Hiltz.

Objective:

Working alongside Ray himself, we were asked to design a fresh new site to best reflect his business and person.

Challenge:
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Like with any website creation, it’s vital to the success of the site to be reflective and true to the brand you’re bolstering. It’s one thing to produce a compelling digital work, but it should always feel like an extension of the subject, even if it is starkly different than what originally existed.

It was important to both Ray and the project to keep the site clean, personal, and informative. His new website needed to encapsulate Ray without looking gimmicky, and as Ray is the heart of his brand, it was especially important to make sure what was produced resonated with him, foremost.

After bouncing ideas and trying out different looks and layout, we wound up with a product we’re proud to present.

Technology:

We developed the site using ZURB’s lightweight Foundation framework. Thinking mobile first, we ensured that the site is fully responsive for the ultimate experience on any device or screen.
ray-logo

Check it out and tell us what you think.