31 March 2009

Predictably Irrational

My review of Dan Ariely's Predictably Irrational was posted on Biznology:

How can marketers deal with irrational customers?

Check it out for some tips on how to predict customer's behavior so as to present your product properly to the market using the principals of behavioral economics. The vignettes Ariely writes about are excellently detailed; and his creativity in constructing his experiments is laudable. See if you like it as well as I did.

29 March 2009

Predictably Irrational by Dan Ariely

How can marketers deal with irrational customers?

Predictably Irrational

Image by .nele via Flickr

by Eva Lyford

You've complained about it--c'mon, admit it. Sometimes your customers do the most irrational things. I mean, there's no explanation for some of the dumb things customars think and do, right? Wrong. Dan Ariely tells us that customers are actually predictably irrational. As marketers we're often flummoxed by the unusual choices that customers make. Behavioral economists, on the other hand, seek to understand the motivations behind apparently irrational behavior and then predict it. This is a highly useful skill for a marketer to have also. Being able to predict customers' or target customers' behavior, however irrational, is an essential tool of the trade.

Dan Ariely's book Predictably Irrational checks out some of the irrational behavior in the market and seeks to understand how to predict it. In the video example below, Ariely explains why discounting a product leads customers to expect a lower quality; as an alternative, he proposes that instead of discounting a product, the product can be presented differently or re-branded and maintain the expectations of quality.

Another example which struck close to home for this dedicated coffee-drinker was Ariely's experiment with a coffee-tasting on the MIT campus. In some scenarios, the coffee was presented along with a series of exotic condiments, which were unused. In some scenarios, the coffee was presented with only usual additives. In the scenarios where the exotic condiments were available, the coffee was scored as tasting better—even though it was in fact identical in all scenarios.

Surely it should have no rational bearing on the intrinsic quality of a product if it is bought at a discount. Similarly, the accessories available for a product should not influence our perception of the value of that product, especially if they aren't even used. But clearly it does, and knowing that gives a marketer an advantage in presenting one's product to the market. Consider for a moment the iPod market: the Apple store doesn't hold sales and the accessory market for ipods is vast although the majority of iPod owners make do only with ear buds. Ariely would argue that both these factors contribute to the perceived value of the iPod.

How does your product compare? Do you discount your product to the detriment of its perceived quality? Are you offering enough exotic options to improve the perceived quality of your product?

also published at biznology.

27 March 2009


The novel Dune is so much better than the movie adaptation. I went to see the movie Dune when it first came out, with a friend who was recovering from an illness. Unfortunately, her illness was not completely gone after all and we had to leave the theater early, so I missed the last 30 minutes or so of the movie. And for that I ended up peculiarly grateful.

In the dark ages before blockbuster movie rentals, there was two alternatives to finding out the ending of the story. Pay to see the movie again, or get the book. The book was easier to get so I read it. And ended up very glad that I did, as the scope of the vision of the sand planet Arrakis and its people was so much grander therein than had been shown in the movie. Frank Herbert's fictional social patterns, history, religion and philosophy were so intricately designed and well constructed as to make the Star Wars world view seem to be built of tinkertoys by comparison.

I was surprised to learn recently that Dune would be re-adapted again in 2010. Hopefully, this new adaptation will be truer to the vision than was the 1984 adaptation. Sadly, I think it is unlikely that they will find as good an casting as Sting as the Harkonnen Feyd-Rautha.

20 March 2009

Southern Culture Trivia

Yellow Dogs, Hushpuppies, and Bluetick Hounds by Lisa Howorth with Jennifer Bryant

I relocated to Indiana from the Chicago suburbs 4 years ago. I hear most Hoosiers don't consider Indiana a Southern state, but I think that's just because they compare themselves to the folks from Kentucky and Missouri. From a Northerner's perspective, there's definitely a Southern flavor to the culture here and sometimes I find I have to shift my frame of reference to understand my neighbors.

I saw the Yellow Dogs book and thought it might be a fun way to pass time in a car ride. Checking through it quickly, I found 54 pages of questions, and 71 pages of answers. Should I conclude that examining Southern culture produces more answers than questions?

Here's a few samples of the Q & A:
"Americana, Brazil is home to what group?"
"Descendants of some two thousand Confederate emigrants who went to Brazil after the civil war..."
Why Brazil?
"What nasty critter... is still being used today by reconstructive surgeons?"
"Leeches... Biopharm, a company based in Charleston, SC, is the largest breeder of leeches used for this purpose."
Is there another, larger breeder of leeches... for another purpose?

11 March 2009

Pure blood-sucking evil

I recently re-read Salem's Lot by Stephen King, perhaps in some irrational avoidance of a commitment to read Bram Stoker's Dracula for a 2006 challenge. I read Salem's Lot first more than 20 years ago, and the story stayed with me. But the details were vague.

Salem's Lot is clearly a derivative work, intentionally so - the introduction by the author is a wonderful explanation of his approach and motivations. But it is derivative in the sense that an heir is derivative of one's ancestors - the comic book vampires, Stoker's masterwork, and all the other stories of blood-suckers over the years.

Barlow, the villain of Salem's Lot is first only referenced obliquely by reference from other characters. This highly clever ruse of secreting the villain away succeeds wildly - such that the villains first intro in the junkyard seems as well orchestrated as a formal debutante ball in the finest noble estate.

Comparing Barlow to other favorite vampires - LeStat, Silas, and the current crop of vampires in horror films - Barlow comes off as the most evil - unrepentantly evil - of them all. And compared to the current crop of dewy-eyed, sympathetic vampires cropping up in teen chic lit books, he cuts a sinister figure.

So now I should really read Dracula, right?

10 March 2009

A Sunny day for war

I recently read Sun Tzu's The Art of War. I read it a while back in college, but was only trying to get through the assignment as fast as possible so that I could go focus on more challenging chemistry assignments which sucked up all my time for a quarter.

The book contains pithy aphorisms, each served up in easily digestible portions to suit the busy warlord on a rampage. However, the wisdom is also useful in modern life, and strangely well suited to being read by daily subscription in an RSS reader. Dailylit.com offers the Art of War as well as many other titles. I started reading the book around Halloween, and finished by Wigilia (Christmas Eve). The RSS-able format is really easy to process, for this title at least, and convenient.

03 March 2009

Nightjohn and Sarny

My son received Nightjohn by Gary Paulsen as a gift, and after I read some information at the publisher's author page I thought I should read through the book myself first before handing it over to my kid. I'm glad I did, because the graphic representation of some of the events would be beyond his age level. I think for our family, this will be a book better read by teenagers. I'm curious to hear whether anyone would recommend this for a younger audience.

The story concerns the inquisitive slave-girl Sarny, and her life-changing encounter with Nightjohn. Nightjohn is brought to her plantation by her owner as a slave and joins the slave community there. He is different than any other person Sarny knows, and bears a secret worth knowing. Nightjohn offers to barter to get some tobacco from Sarny, and she is incredulous, thinking to herself:
What you got to trade? You come in naked as the day you was born... and you're ready to go trading?
Over time, Sarny starts to learn his secret. Unfortunately, she is only a child and very young to be trusted with such illicit knowledge; when she reveals the secret, as children will do, the consequences for the slave community on the platation are dire and her guilt is awful.

Even so, Sarny is forgiven; her community expresses uncommon wisdom by recognizing that expectations of discretion from a child were unrealistic, and they never blame her. Instead, she is challenged to put the energy of her guilt to work fulfilling a greater purpose.

I read the book in one sitting, as the story is so compelling. The conditions in which Sarny lived and the trials she and her community experienced are heart wrenching. The author does a wonderful job in capturing the dialects of the characters, and in representing int he fictional story the events based on the historical record. After I completed the book, I was pleasantly surprised to find that there is a sequel which continues the protagonist's story, and I will be reading that once my order arrives.

related post: Sarny by Gary Paulsen