The Bias Against Creativity - Rory Sutherland

He's the chairman of Ugulvi UK.

Ladies and gentlemen, please welcome the legend himself, the inimitable Rory Sutherland.

First of all, can I just say I'm delighted I joined early because even though I had no sound, that last presentation was one of the best presentations I've seen in 36 years of advertising because the case studies Samo Samso, the Kiwi fruit, were absolutely Spotify, were absolutely magnificent, and I particularly loved the banana one.

Um, I have, by the way, an insanely overwrought banana, which can only be used, I understand, for making uh cupcakes. Um, I have it in front of me, and I'm just going to share a very interesting fact, by the way, which is every single human being on the planet when it comes to opening a banana takes the stalk. You take the stalk and you bend it through 90 degrees and then you peel it. What's fascinating, by the way, is this is almost certainly just culturally determined because every single chimp and ape on the planet who have been eating bananas for longer than they have been human beings does it the other way round. They take the other end of the banana, they squeeze it, and once you squeeze it, it's actually incredibly easy to peel.

So, one of the points I'm making there is an awful lot of human behavior is driven by social copying and habit. Next time you eat a banana, try doing it the chimp way round and you'll actually discover it's much better. And our job as marketers sometimes is simply to break those two really strong forces that drive for very sound evolutionary reasons that drive human behavior, which is: do what everybody else does and do what I've done before. Now, those are the two safe bets. They're the two safe default options. The problem is is that if you have an innovation, it requires people to change both of those defaults. You're doing what most people don't do. You're opening the banana from the other end, and you're doing something that you didn't do previously. And both of those things are difficult.

And that caused me to have an insight which, after 35 years, had never occurred to me before. I always kind of thought that the bigger your idea was, the less marketing it needed because it sold itself. And then I realized that actually, the bigger your idea is, the more behavioral change it requires and therefore the more marketing it needs. And I think that's just important because I think the general prevailing mood in business is: if I have a have a big enough idea, it won't need any marketing. And my counter to that is: if you have a really big idea, it'll need a lot of marketing.

So if we go on to the next slide, what I'm talking about here is I saw there four fantastic creative ideas. They were also, in the case of Samo Samo, beautifully informed, and actually, of course, in the case of the Kiwi fruit, beautifully informed by the idea of behavioral nudges. By the way, a really useful finding is in Samso Samso's case: the less you use your phone, the less you paid to buy their goods. There's a very sound behavioral principle that's established which is that any discount that you've worked for has a higher perceived value than a discount that's just handed to you on a plate. So anything that actually requires some sort of effort on your part to earn a discount, whether it's a mileage program on an airline or anything else, the discount feels more valuable than something that's just given to you unasked for and unearned. And understanding these kind of human perceptual quirks is really important because often they seem not to make sense. They often run counter to kind of standard economic logic or economic doctrine.

And I've I've called this presentation actually something which I call just the bias against creativity. And the bias of creativity, I think, comes from the fact that, um, interestingly, nearly all business thinking is derived from the idea of scarcity, that we have limited resources and we have to deploy them very efficiently. And so economic thought is very, very good at dealing with things that are in scarce supply. But as the previous speaker actually said on one one of his slides, there's no shortage of human ingenuity. Human ingenuity is actually abundant. What's really difficult is deploying it.

And if I look back on all of those four case studies which I saw, Samso, Samso, um, the Kiwi fruit, the banana, all of them have something in common, which is you can't prove them in advance because they're new. There is no data about the future, and consequently, almost everything that's innovative and interesting requires someone to take some sort of leap of faith because there's a lot of data about the status quo and there's absolutely no data about the alternative. And so if we work in a culture where people demand absolute proof and certainty down to a high level of decimal places before you can do anything, which pretty much describes, I think, the culture in which marketing finds itself. In other words, marketing is now enthralled to finance and procurement and operations and a whole bunch of cultures which have a scarcity mindset. It makes it impossible to do really good marketing.

And here's a little bit of a data point, if you like, a little bit of evidence in support of my thesis. These are the five gold winners for the Advertising Effectiveness Awards in 2025, organized by the Institute of Practitioners in Advertising in the UK. And they're incredibly robust and rigorous awards which really measure efficacy. Um, but the five companies, if you just go back to the list of five very briefly, the five companies are all, no, sorry, not quite. Four of them are family-owned businesses. McCain is a family-owned potato company, Canadian. Laithwaites is a family-owned wine company. Specsavers is a family-owned optician. Yorkshire Tea is a family-owned tea and tea shop and coffee business. Guinness is not a family-owned business. It's owned by Diageo, but Diageo run their brands as though their brands were family-owned businesses. Guinness is very, very popular now because of a plan they put in place 10 years ago. And family-owned businesses are prepared to actually take risks because they don't have to report their finances every quarter. They're prepared to try new things, but also they can operate mentally on different time scales.

And if you go to the next slide, I went to Texas recently and I kept noticing. I recommend going to Texas because Texas now is like California was in the 1990s. It's a place of extraordinary experimentation, uh, and extraordinary economic dynamism. And I kept coming across these extraordinary businesses. This is BUC-EE'S, which I can only describe as a cross between Disneyland and a gas station. The next one is, if you go to the next slide, is H-E-B, which is um an extraordinarily good grocery chain, which is so good that Sam Walton of Walmart said he wasn't going to bother competing with H-E-B because they were too good at what they were doing already. I I made inquiries, both of them are family-owned businesses.

And so if we go on to the next slide, for example, this starts to worry me because I think we might have created this world in which um publicly owned businesses, businesses that have to report to the stock market, are incapable of building brands anymore. Probably not true of Proctor and Gamble, probably not true of Diageo, probably not true of Unilever, probably not true of Nestle because they're significantly marketing-led. And they orient themselves around creating customer value as well as just shareholder value. But time and time again, I keep discovering this thing where every time there's a brand, there's a family. SC Johnson actually calls itself a family company. Dyson is basically, if not entirely family-owned, it's founder-led. Fortnum & Mason, owned by the Canadian um Western family. I went in there somehow. It's it it has a kind of vibe that's not like every conventional retailer. Enterprise Rent-A-Car, Octopus Energy, not family-owned, it's private capital owned. It's again founder-led.

And on the right is a picture of, if ever you're in the UK and you want to stop your car somewhere. This is Tebay Services, a motorway service station which was opened by a family of farmers. And unlike every other motorway service station in the UK which are generally slightly despised, this one is actually a destination. People will actually hold on to their bladders for an extra 20 miles or they'll divert their journey just to have an opportunity to stop there. And there's something here, by the way, which is very simple. If your brand is owned by a family or your company is controlled by a founder, there's a very simple thing to ask yourself strategically, which is: what does this allow us to do that our competitors can't do? And one of the things you can do is you can try things without proving them in advance. In other words, you can adequately innovate. And you can also adopt behaviors which create customer value in ways that aren't directly measurable or attributable. You're not a slave to last-click attribution or any of these absurd metrics which dominate the kind of publicly owned companies where people are more interested in justifying their existence than they are in in serving businesses.

But if we move to the next slide, this bias against creativity really worries me because every time I research a really innovative breakthrough marketing or pricing or product idea, I discover that it's encountered a lot of internal resistance. When Jeff Bezos, fortunately he ran the place, when he had the idea for Amazon Prime, several board members threatened to resign if he introduced it. Nestle only managed to produce Nespresso, which is one of the greatest innovations in value terms produced by a large public company in the last 30 or 40 years. The only reason Nespresso survived was that the people at Nespresso lied to Nestle head office about how much money they were making in the first two years. So they only survived really by faking their accounts. And you suddenly realize we've created, through our need for quantification, self-justification, and perfect prediction, we've created a straightjacket for ourselves. We've painted ourselves into a corner.

And as marketers, I think we've made a terrible mistake because we latched on to Alphabet and Meta because they held the promise of accountability. "Don't worry, you'll be able to justify every penny you spend." And we thought, "That's wonderful. We'll be able to spend much more on marketing when we can prove what we can do." But there's a problem to this, which is suddenly you're not allowed to do anything you can't prove in advance. So the only thing you're allowed to do is bottom-of-the-funnel transactional marketing, not the long-term brand building, which is slower to emerge, harder to prove, and to an extent is probabilistic, not deterministic.

If we go on one more slide, for example, and there's a fundamental cultural rule. Uh, this man is called um Barry, uh, Rick Barry. He's now 81 years old. As you can see, he played for the Golden State Warriors basketball team. He retired in 1981. He was born in 1946. He still holds the record for the highest percentage of successful free throws in basketball. This is when you get to throw a ball as part of a penalty, and you're effectively standing there and you get one shot at the hoop. He still holds the record, even though he retired in 1981. And the fascinating thing about him was he threw underhand, unconventional, ridiculed by other basketball players. Shaquille O'Neal said, "Rick, I'd rather throw up than throw underhand. I'm just too cool to do it."

And one of the greatest ways you can achieve an advantage in business is by finding a cultural obstacle to your competitors copying you. If you find something which your competitors can't do physically, they can't do legally, they can't do because they lack the scale, the distribution, the brand power, yep, exploit that. But the other area you can exploit in strategy, as the great Roger L. Martin points out, is you can simply exploit a competitor's cultural blind spots. When I talk to digital companies, one of the things I always recommend is they test physical direct mail, and they always look at me as if I'm slightly mad because they go, "It's a really old-fashioned 1980s medium." And I said, "Yep, and it still really, really works." But there's another advantage to physical direct mail, which is that digital companies find it completely countercultural to do anything that's actually physical and old-fashioned rather than digital and modern. So, it doesn't matter how successful your physical direct mail campaign is, your competitors won't copy you. It's exactly the same with um, uh, with Rick Barry. Everybody could see the statistics. They could see he was shooting 90% successfully by throwing underarm, by effectively holding the ball down low, relaxing himself, and then throwing it up in the air. No one would copy him.

And this comes down to, if we move on to the next slide, some really, really strong cultural things, which is asymmetry and decision-making. And the the thing you need to understand in nearly all realms of data is: yes, your data might be accurate, although it probably isn't. Your data may be robust, it may be real-time, it may be fast, but almost all data is asymmetric. In other words, it captures a lot about the past, but it captures nothing about the future. It captures a lot about your existing customers, but doesn't capture anything about your potential customers. It captures a lot about, for example, what you can measure and put into a number, which tend to be financial transactions. It contains almost nothing about the emotional feelings that actually led to that transaction in the first place. All data is woefully asymmetric. And in a way, the more data we have, the more vulnerable we become to um information asymmetries.

But it gets worse than that because I also noticed something else. Um, I've worked, we can go to the next slide here. Has anybody noticed this problem? Okay. And it took me 15 years working in advertising in business before I realized there's this complete asymmetry in the approval process for any idea. If you have a creative idea, and maybe this is right, I'm not necessarily saying it's wrong. If you have a creative idea, you have to present it to completely rational people to do a cost-benefit analysis and a, you know, and an ROI model and a kind of justification. All the rational stuff has to be ticked off by the rational people. It never happens the other way around. You never get rational people going, "Yeah, yeah, yeah. I think that makes sense. I think we think that's 3.5, but before I present it to the board, I'm going to share it with some really wacky people to see if they've got a different way of solving the problem."

And if we go on to the next slide again, um, uh, there's quantification bias, which is that things that are numerical get given priority over things that are verbal. AI might rebalance this a bit, although only a bit, because AI only captures things that are thought and said. It doesn't capture things that are felt. So, we need to be a bit cautious of this. But, nonetheless, AI may rebalance things a bit from a numerical um, uh, model of business to one that's slightly more verbal, which I think, if we're being optimistic, which I sometimes am, might be a healthy thing.

But you also have a thing called the alignment problem. Now, here's something. One of the most remarkable people in marketing I came across only about a year ago. He's called Adel Al-Bura. He's a former boxer in Benghazi in Libya. And he made this argument that the way we now justify advertising isn't something we as marketers have chosen ourselves. We go on to the next slide. Should come on. Yeah. He's written a post on, I think it's Medium, "The Greatest Trick Big Tech Ever Played on Marketers." Now, I would argue that if you want to be a free, independent individual, to some extent, you have to set your own metrics for success. You have to decide whether money is more important than free time, whether lifestyle is more important than, you know, than than cash. You have to decide what makes you different and pursue those things according to some ratio of your own particular taste and judgment. You know, I always find New York a very depressing city because everybody there seems to be entirely focused on making money, and there isn't any kind of counterpoint to it. I'd much rather go somewhere like, you know, Texas or or or Chicago, which which is a bit more variegated.

But Al-Bura pointed out that it's commercially naive and strategically negligent to assume that firms like Meta and Alphabet, whose core revenue models depend on monetizing behavioral data and industrial-scale attention segmentation, would refrain from exerting implicit influence over marketing orthodoxy. And his argument is that the metrics we're actually working to as marketers in the digital world aren't designed to suit the interests of our business, or to suit the interest of our brand, or are designed to suit what makes our brand different and differentiated. Instead, we're working to metrics that are really designed to make Meta and Alphabet richer because we're measuring the things that they sell. And this is this feat has been achieved. I worked in direct marketing in the 1990s. We could measure and test then. Nobody in marketing seemed to think that measurement and testing was all that important because McKinsey and Accenture hadn't come in and persuaded all their clients to adopt an incredibly numerical model of efficiency because they wouldn't have made any money selling direct marketing. Now, those consulting firms make more money from sort of tech implementation projects and marketing transformation, far more money than they do from strategy. They make no money from strategy at all. And so, it's massively of their interests to convince, if not marketers, than the people marketers report to, that the only future of marketing is one of perfect granular quantification and perfect accountability.

But none of those ideas in the pre in the previous slide are necessarily perfectly provable. We can see, yep. We can see at a rough level that the sales went up, uh, in the store with the kiwi fruit, uh, by double digits compared to the stores that didn't stock the pillbox kiwi fruit. We don't know individually at what level that idea worked. We only know how it worked in aggregate. Now, that wouldn't meet the requirements of perfect granular accountability which have been sold to us by, I think, Meta, Alphabet, and their running dog lackeys in management consultancy. And I think that's not entirely cynical on their part. That's how, if you're a management consultant and you almost certainly have a degree in engineering, that's how you think things should work because your engineering mindset is all about pulling things apart. But the marketing mindset is completely different. It's all about putting things together.

So if we go on to the next slide, when I read Adel Al-Bura's fantastic presentation, I pointed out that there's a similar problem in a parasite in cats called toxoplasmosis. And so between us, we coined the phrase technoplasmosis. Toxoplasmosis is a cat parasite which largely thrives by infecting the brains of cats. But because cats don't bite each other very often, it finds it difficult to get from one cat to another cat. So it has an intermediate host, which is typically a mouse or a rat. Now, when toxoplasmosis infects the brain of a rat or mouse, it changes its brain chemistry so that mouse is no longer frightened of cats, to maximize the chance that that mouse will get eaten by another cat, and therefore the toxoplasmosis will be able to take up residence in a second cat. I would argue that to some extent, if you think about this, is absolutely in the interest of the parasite, and it is not in the interest of the mouse or the rat. I would argue that we have been infected by a similar technoplasmosis, which is the metrics in marketing have been designed to suit the interests of our parasite, in this case Meta or Alphabet, not the interests of the host organism. As a marketer, I think you should design your own metrics of success. And the metrics of success should depend on what your brand is, what your business is, what makes it different, and what your brand strategy is, how you intend to differentiate. If we adopt exactly the same metrics of success as everybody else, we just get crushed into a bottleneck where we're competing with everybody else for the very scarce resource, which is of course exactly what Meta and Alphabet want us to do. So I think we have to be really cautious here. I think our corporate brains have been infected by an idea of evaluation which is not really originated by marketers or even by the business itself. I think it's actually originated by effectively, uh, the interests of a parasitic organism which realizes that particularly public limited companies are so determined to achieve predictable incremental growth that they will sacrifice all other opportunities in the pursuit of boring incremental improvement, which is precisely what they promise to sell. So, you know, what are your metrics to success? As soon as a metric has a three, a three-letter acronym like, you know, LTV or, you know, CAC. Okay. As soon as a metric has an acronym, it's time to find another one because otherwise you'll end up pursuing the same metrics as everybody else. And people say to me, Rory, I don't understand why you're so famous. And I reply, neither do I. But the one explanation I can make is I never judged my success by entirely conventional off-the-shelf modes. I looked at opportunities somewhere else where nobody was looking. And that's probably it.

If we go to the next slide, because you've probably had enough of cat parasites by now. Um, notice when I mentioned that creative people have to present everything to rational people. It never happens in reverse. Notice that it's always rational people that define a problem. It's not marketers, it's not creative people, it's not psychologists. The people who define business problems define them in ways that suit their own particular discipline. So if we go on to the next slide, you probably know me. I got weirdly famous by making what was half a joke, half a sensible suggestion, which is that why are we spending £6 billion making a train faster when for £50 million you could put really good Wi-Fi on the trains? You wouldn't reduce the duration of the journey. You'd just increase the quality of time spent on board. But duration is an engineering problem, and quality of time is a marketing problem. And the engineers got to define the problem first. And so they defined it in as an engineering problem, not as a marketing problem.

Next slide. I don't know how electric car adoption is going in Karachi. In the UK, it's about 25 to 30% of new cars are electric. The big problem with electric cars psychologically, in terms of selling them, maybe technologically, in terms of their capability, is a thing called range anxiety. People get paranoid about the fact that they're going to run out of juice. In the same way we do with mobile phones, unless you're my wife who's mad. My wife will happily walk around with a mobile phone at 5%. I start hyperventilating if it gets below about 60%. So if you're my wife, you don't suffer from mobile phone range anxiety because she's completely mad in my opinion. If you're me, you do. Now, billions of pounds have been spent, wait for it, by engineers trying to increase the range of these cars to reduce range anxiety. You can increase range. And they've looked for more energy-dense batteries. And it's a very good idea. And it's not a necessarily a bad use of half a trillion dollars of research investment. But here's my complaint as a marketer: nobody's even spent a hundred million, never mind hundred billion dollars, trying to do the opposite. Instead of increasing range, reduce anxiety. And there are lots of really easy ways we can do this. For one thing, my electric car tells me I have a battery of 93% or 87%. And then I go to the shops and it goes down to 86% or 85%. I don't need to know that. Just say 80% plus. I'll need to know it's at 11% or 12% if I'm down to a very low battery because I need to know the precise range remaining. My petrol gauge never told me I had 81% in the fuel tank or 83%. It just told me the thing was pretty much full. I don't need that level of detail.

Similarly, in the UK, we have a problem of asymmetry of information, which is that petrol stations are very visible, but electric car charging points, because they're quite small, you can drive past them without noticing. You can't drive past a petrol station without noticing. You can easily drive past um, a um, an electric car charging station without noticing. And my argument is, look, maybe to solve this problem of range anxiety, we don't need lithium, we need neon. We just need to light the electric car chargers really brightly so they glow purple to a point where people start complaining there are too many of them. At which point we know that our range anxiety problem has gone away. And so marketers don't even get to the problem until it's been defined by engineers. That's another example of an asymmetry.

Now I'll go on to the next slide and the slide after that. I'm also talking about something which is hugely problematic for all marketers. Now I thought this was an agency problem, and it used to piss me off working in an agency. Then I realized it wasn't just an agency problem, it's a discipline problem. If we go on to the next slide, it is possible in marketing. If I look at that kiwi fruit idea, that is an idea for all eternity. Okay, you can run that idea. It only cost a few thousand dollars. It got huge awareness. You can sell kiwi fruit like that absolutely brilliantly for the next 10, 20 years. Okay, if you take, you know, the idea of Samo, you can run that every time there's Paris Fashion Week. It's an idea with eternal value. Um, the banana stickers, eternal value. What a beautiful idea, by the way. I mean, just, oh, adorable. Okay. It's eternally valuable. It adds value to the relationship you have between you and your present customers, you and your future customers for all time. The best ideas, the best behavioral ideas are like that.

This is something we did for British Airways where we changed their choice architecture of their website. So people who asked for an economy flight also got shown a premium economy flight and a business class flight because we said sometimes the price difference isn't all that big. But we also said something about human psychology means that we can't buy a premium product unless we know what the basic one would have cost. Our perception, I always say to economists, price is a number, but to consumers, price is a feeling. And we feel price very differently from how we calculate price. And consequently, if you were on a plane to London, let's say from Karachi, and it was economy £800, premium economy £1,200, you might go, "Ah, what the hell? It's 50% more." If it was £3,700, my hunch might be that you wouldn't, even though the amount you're paying on top is exactly the same in either case. What this idea did is it made the airline, at a cost of £25,000 to make the change to the website, it made them £10 million of incremental high-margin premium cabin revenue that year and the following year and the year after that and the year after that. It's now 13 years in. So it's added to their revenue by something like £130 million. Do you know what we got paid for that? £25,000.

Now, next slide. This is an idea which is literally worth billions, which is a marketing idea. There was a network of railway lines running around London which nobody used. They spent £200 million improving them. But then they did something brilliant. They added, they pretended the lines were tube lines. They called it the Overground and they added it to the London Underground map. Now, something about human psychology. Those of you who are devotees of Byron Sharp will know he talks about mental and physical availability. One way to make something as a part of a transport network mentally unavailable is to put it on a different map. If you ever try this, by the way, try making a journey where you have one map that shows roads and one map that shows railways. It's impossible. You'll end up going either by road or you'll end up going by rail because it's impossible in the human brain to fuse two maps into one. So they pretended this line was basically a um, a tube line, and they created, I would argue, well, they spent £20 billion making building the Elizabeth Line, which carries about the same number of passengers as the Overground does. The Elizabeth Line was a new line. It cost £20,000 million. This cost £200 million pounds, 1% of the cost, but it now carries as many passengers. That is a marketing idea for the ages. It is eternal. Okay.

Now, if we go on to the next slide, this is an idea which is eternally beautiful and brilliant. I'm booking a room. Whoever had this idea has just made $100 million or more, maybe even half a billion dollars for the worldwide hotel and hospitality industry with a single stroke of the keyboard. I'm booking a hotel at um, the InterContinental in Hilton and InterContinental in Houston, sorry. And normally you get the choice of room which is, you know, standard room, deluxe room, premium room, junior suite, club suite, you know, bridal suite. It's all about how big the room is. They'd add an extra dimension, which is pool access and gym access. You could pay a bit extra for a room which was otherwise fairly standard but happened to be close to the pool, or you could pay a bit extra to have a room which was otherwise standard, which happened to be close to the gym. You can probably guess which one I chose looking at me physically. Now, I happily paid, I think we stayed there three nights. I paid $60 for something which otherwise would have gone completely to waste. They basically made $60 out of me. They didn't have to paint a wall. They didn't have to install a door. They didn't have to build a new room. They didn't have to decorate a room. They just described a room in a different way and they made an extra six. It might have been $90 actually from me, 'cause I don't like wandering down long hotel corridors in a toweling robe looking like a weirdo. These ideas are eternal. They're marketing ideas. Yet, wait for it. Okay, next slide.

This idea came from Ogilvy in Sydney. Glorious, glorious place in Sydney. Run by at the time by a guy called Dave Fox, uh, who you must get out actually because he's something of a, you know, hero of mine, and they came up with this idea which has since rolled out to about 180 countries. You've almost certainly had it in Pakistan, although with, uh, different names. It will have rolled out in India, will have rolled out in pretty much every country. It's been running for the last 10 years and it's made Coca-Cola. I can't give away figures, but let's just say if not a billion dollars. Okay. It's made them a figure that's probably nine digits. What did Ogilvy Sydney get paid for that idea? $350,000 Australian dollars is what they made out of that idea, which is enough to buy a small flat in a part of Sydney. You make $100 million, you get to keep $350,000. Now, I was getting pissed off with this.

Next slide. Again, I was getting pissed off with this because I thought it was unfair to agencies. Here is an American Express card. Uh, a young guy, maybe an accountman actually, at Ogilvy in the 1960s said, "Why don't you put 'Member Since' throughout the card?" Every American Express card carries this member since date. I don't know why it hasn't been more widely copied, which means that no one wants to cancel their American Express card because if they did and then they rejoined, they'd go back to "Member Since '25" and it makes you look a bit of a loser. I've got a card here. I'm going to just check. What am I? Member Since '95, I think it is. Yeah, '95. That is worth, and has been worth since 1967, millions of dollars in retained card members to American Express. I don't think Google got paid for that at all. By the way, I don't, I genuinely, I think they just suggested it and got paid no money at all.

Now, here's my problem. If you go on to the next slide, I was getting really pissed off about this because I thought it was an agency problem. This business of being an agency is rubbish. You come up with an idea which makes a client hundreds of millions of pounds, and then you basically get given the money for the time it took you to come up with that idea once. And then I realized it applies to marketing as well because marketing is held accountable for every single unit of cost it incurs on a daily basis. But it can only claim the credit for incremental sales in a very short time period after the idea was conceived. Do you see what I mean? It's like being J.K.

Next slide. If you go to the next slide. Yeah. Okay. I'll I'll I'll go on to this. It's like being J.K. Rowling and being told, "Yep, you can claim, um, we'll give you the royalties, but only on the first edition of the book." It's like being a drugs company where you say, "Yes, you can only patent a drug for three weeks." No one is going to invent a blockbuster drug because it wouldn't pay them to conduct the research costs. If you had a pharmaceutical R&D division to a pharmaceutical company, you wouldn't go into that company and go, "Did you invent a blockbuster drug in the last two weeks?" Because if not, you're all fired. But that's exactly how marketing is judged. If we come up with a brilliant eternal idea which brings in money, American Express is still making millions and millions of dollars a year from an idea that somebody at Ogilvy had in 1967. Without that idea, it's plausible that American Express wouldn't exist or would have been bought by somebody else. The whole of history might be totally different. But the valuation of that idea is the time it took to come up with it, if you're an agency. And if you're a client, a marketing client, the valuation of that idea is, well, whether it has an incremental effect on first-year retention. This is right? This is absolute. In other words, we said, we said, "Oh, great. We can be accountable." But what we've actually inadvertently agreed to is: you can account for all of our costs, but give us the credit for about 5 to 10% of what we do because after quarter one, it no longer counts. Those kiwi fruit ideas. No, no, no. All the credit for that goes to finance or distribution or somebody else. Doesn't get a marketing. Never feeds back to marketing. And the problem is that marketing is probabilistic and it's fat-tailed.

Now I'm going to get a bit controversial here. Some of you who've seen me speak before will when I talk about bees. And bees do two things. They follow a waggle dance and they go and find pollen and nectar from sources of pollen and nectar they already know about. That's a very simple kind of cost-benefit analysis. It's an efficiency optimization problem. You know, in other words, value of energetic value of pollen retrieved has to exceed energy expended in its collection. But they also engage in a process of discovery, which is with bees which go off at random and occasionally find a completely new source of pollen. Now looked at through the lens of an accountant, most of those bee journeys are a total waste of time. But one in a hundred of those journeys comes back with something much more valuable than pollen. It comes back with a whole load of information about where there's a lot more pollen which you can continue to exploit for the next two weeks. And bees are intelligent enough to realize that you can't optimize R&D in the same way that you optimize operations. They have a separate accounting function for both of them. We don't. We've allowed the accounting function, the procurement function, the compliance function, all the functions of business that apply to operational efficiency, apply not just to those parts of marketing which are about operational efficiency. They apply to the whole thing, including our R&D, including the kiwi idea, including the banana idea, including the Samsung Samsung idea, which are eternal ideas. They are eternally lastingly durably valuable.

So next slide. The math is totally different. The math and the time scales you need to actually, uh, consider when doing the math for one thing versus another thing. It's a totally different math. I'm friends with Nassim Taleb. Okay. One thing I know about is some things are fat-tailed, some things are thin-tailed. There are things which follow a normal distribution, and there are things where the outliers have disproportionate effect. Marketing is very largely, not exclusively, it's very largely fat-tailed. How do I know? Because Nassim Taleb said this to me, the world's leading expert on fat-tailed distributions, said to me literally over dinner in Amsterdam, "Marketing is fat-tailed."

Now, if we go on to the next slide, I'll be very quick here because I'm running out of time. I think this is a central dichotomy in algorithm design, animal foraging, animal behavior, business behavior. It's called the explore-exploit tradeoff. It isn't really a trade-off. The two activities are complementary. They're actually part of what you might call a flywheel. The better you exploit, the more you can afford to explore. The more you explore, the more you discover, the more you have to exploit, and so on and so forth. In a in a virtuous circle, but for a weird Western reason, we call it a trade-off. It's not a trade-off at all. In a dynamic system, it's actually a necessity also because if you don't explore, you get over-optimized on the past and eventually you become over-reliant on known sources of pollen which dry up and then the hive starves to death. If the hive doesn't explore, it can't grow because it's limited in its pollen collection capabilities purely to. This is why being famous is useful. By the way, when you're when you're not famous, you have to find all your customers. When you're famous, your customers come and find you. And a lot of those customers are customers of whose existence you were completely unaware previously. You get lucky when you're famous because you're increasing your surface area exposure to positive upside optionality. That's Nassim Taleb, not me.

If we move on to the next slide quickly, I'll um do the same thing. The culture you need for the two behaviors is completely different, just as the accounting is. Exploit is all about the kind of people we see in control in business. You know, to be honest, if you want me to be a bit blunt, Steve Jobs was explore. Tim Cook is exploit. If we want to be absolutely blunt about this, his background is in supply chain and finance. Steve Jobs's background was in something far weirder. The fundamental math: many small bets expecting few outsized winners. That's what we should be doing with 20 to 30% of our marketing budget, and we've just seen four of them. If you want proof of concept of that, all of those things I, I've never seen any of them before, and I was absolutely in love. Okay. Iterative experimentation, feed fail, speed failure, learning. We're not allowed to do the left-hand side bit anymore. The procurement and finance people are telling us we can only do the right-hand side bit. You can't do one of those two things. You have to do both. It's an absolute imperative.

Next slide quickly. I must get down to the fundamentally efficiencies. Now, I know this is a really bad analogy to use in an Islamic country, but I'm rather guessing that you all know what poker is, and some of you may even furtively have played it. Okay? If you play poker, what you'll notice if you play poker is that in the course of an evening, actually, although you're playing all the time, four or five hands basically determine whether you win big or whether you lose big. All the rest of it is kind of also-ran. It's fine. You might be making small gains, but it's four or five big opportunities that you seize. There is a wonderful book which I shouldn't recommend to you, but I will, uh, which is a book by Annie Duke called "Thinking in Bets." And Annie Duke was a professional poker player, and her whole point is that poker players make decisions in a way that considers not just the likelihood of success, but the scale of the possible payback. And they're very comfortable operating in a world of complete uncertainty. They don't demand complete predictability because they're used to considering three or four possible, um, future scenarios at the same time. Uh, backgammon, by the way, if you're also a fan, which I think originated in your part of the world, backgammon is also a brilliant game to play if you want to develop this particular decision-making skill. I don't play it much myself, but I can completely understand why it's absolutely valuable. And you don't find entrepreneurs in, in, I hate to say, you don't find entrepreneurs in chess clubs. You find entrepreneurs in casinos. You go to a London casino. It is entirely packed with entrepreneurs, independent businessmen, uh, etc., far more than you'll find civil servants, for example, because they understand that's basically how the world works. And what they're doing is not trying to be right, which civil servants are trying to do. They're trying to get lucky. And they're trying to get big-time lucky maybe two or three times in their life. David Ogilvy actually said that he only had five big ideas, really big ideas, in his entire working life. I worked on American Express for 15 years. When I look back on it, three or four hands, as it were, three or four ideas, and two of them were client ideas, I'll be absolutely fair there, really contributed more value than everything else we did. But we couldn't have said what they were in advance. That's why you have to experiment.

So, if you just move on a tiny bit more, next slide. Sorry about this. Um, that's Walt Disney. He's warning against the fact, and the next one, if you don't like Walt, is John Maynard Keynes. Next slide. It's often better for reputation to fail conventionally than to succeed unconventionally. We have an aversion to trying new things because we feel comfortable doing something that's worked before, and even if it hasn't worked very excitingly, and even if it doesn't really work very enduringly, because let's face it, you know, you're basically back, you know, with, if you succeed in marketing in Meta and Facebook, you, it's, it's like fentanyl, you know, you're back, you're back to the clinic to re-up your supply three weeks later. If you have an idea like that kiwi fruit idea, or like the Coke idea, or like the banana idea, or like, okay, that's yours. That's yours to keep. And yet we don't distinguish between renting our customers and owning our customers. We all do with a house, but we seem happy to say, "Let's negotiate a really good rent with um, with Meta so we can rent our customers a little bit more cheaply this month. Why don't you go somewhere else and try and own them?" You know, you know that I'm a Georgist. They're the Duke of Westminster, right? They're the big landowners. They're the British East India Company, right? They're a big extractive monopoly, right? The job is not to pay them less money. It's to try and avoid them altogether, in my opinion. Anyway, next slide.

Yeah. Okay. Another asymmetry, benchmarking. I, how now, I think I think if we're going to have time for a Q&A, I have to rush on to the end now, probably. But very quickly, what Walt and what John Maynard Keynes are saying is people tend to copy their competition and they benchmark against the competition. Here's another idea which any marketing person can play. You can do it at the smallest possible level, at the micro-level, or you can do it at massive scale. If I go on to the next slide, read this book. It's wonderful. Will Guidara, "Unreasonable Hospitality." He ran, uh, the, um, 11 Madison Park, which was at one point the 50th, in, in 2011, it was the 50th best restaurant in the world, Michelin Three-Star Restaurant, New York. And according to the San Pellegrino Restaurant Awards, it was the 50th. It's now gone completely vegan for some weird reason. Um, and by the way, if it doesn't serve haleem, in my opinion, it is not the best restaurant in the world. But, um, uh, that is, but by the way, if you're ever in London, Saloo, Pakistani restaurant. I think there's one in Karachi. Haleem Akbari. Absolutely off the charts. Best food ever ever conceived by the width of the hand. So, there you go. I think there is a Saloo in Karachi. So, go there for dinner if you get the chance. Bloody expensive, but it's worth it. Anyway, this guy ran the best restaurant. He got it from number 50 to number one. And the way he did this was when he was the number 50 restaurant in the world, he took his team to the best restaurant in the world, and they started benchmarking. They started copying the things they like. Oh, we could do this with the napkins. We could have

An amuse-bouche between courses. We could do this. We could do that. The end of the meal, Will, a wonderful guy, said, "I'm not interested in any of this. What I want to know is what did the restaurant do badly, not what did the restaurant do well? Because if we can find something this restaurant's doing badly and we double down on that and do it brilliantly, we will get much more 'wow' effect than if we simply copy something they're doing already."

What we're doing there is what I call "optimized for surprise." And they came down to two things. The coffee was nothing special. And if you were a beer drinker, you got a very poor selection and very rough, you know, very short shrift treatment compared to the wine drinkers. The wine drinkers were fawned over and they were given tasting notes and all this sort of stuff. And the beer drinkers were told, "Yeah, we kind of got Peroni on draft or something." Nothing wrong with that, but it wasn't the same level of experience.

And so he goes back to his own restaurant. He appoints one of his staff the coffee sommelier and he appoints another one of his staff the beer sommelier. And suddenly you're in a Michelin three-star restaurant. You go, "Actually, it's a hot day. I feel like a beer." A guy arrives with a list of craft ales from all over the United States. Uh, tasting notes, pairing suggestions with the food. You've never experienced that ever before in your life. And therefore, you will remember that in a way you wouldn't remember an amuse-bouche between the second course and the third. Other people do the first, nobody does the second.

Now, if we move on, there is a good reason why this works. Optimize for surprise. Uh, we'll go on to the next slide. I think I think that's what Steve Jobs did. Everybody in tech was competing on the performance of a computer and they completely ignored usability and aesthetics. What Steve did is he didn't ignore performance. They were high-performing machines, but they weren't cutting-edge. But he doubled down on aesthetics and appearance because what everybody had failed to notice while they were completely focused on benchmarking themselves against IBM or benchmarking themselves against uh, you know, whoever it might have been on clock speed and so forth, they completely forgotten the fact that computers were so bloody ugly that if you put one in your home, it turned your room into an office effectively. So that's what I call reverse benchmarking. Find what your competitor's bad at. Do it brilliantly.

Next slide. Buc-ee's. I mentioned them before. The entire idea is built around the fact that the restrooms are fantastic. What are gas stations bad at? They're bad at restrooms. Who decides where you stop? The founder of Buc-ee's decided it was probably the passenger in the car, more often a woman than a man, who actually said, "No, I don't want to stop there. The restrooms will be horrible." They were the people who could get you to drive another 20 miles to go to Buc-ee's instead. The entire premise of the place is that the women's restrooms are palatial. There is a Turkish brand doing the same thing, by the way, a Turkish petrol station brand founded by a husband and wife who used to be teachers. I don't quite know how you go from teaching into running a gas station chain, but they've done it. Um, people who run their gas stations are terrified of the owners turning up because the first thing they do is head straight for the restrooms. And if they're anything short of perfect, you're out of there.

Next slide. This is just a hotel in Abu Dhabi. If you're ever in Abu Dhabi, stay there. They did one wonderful thing. They did do lots of wonderful things, but every time you stay at a provincial hotel, what time do you stop serving breakfast? Well, it's 8:30 normally, but on Saturday, we keep it open till 9. These people, 11:00. Okay, you had me at 11:00. I don't care. The rest of the experience could have been less good than it really was. The fact that you do breakfast until 11:00. I'm on holiday. I don't want to be getting up and struggling to go down to a restaurant somewhere. I want to take it easy. You've won at that point.

Next slide. And the reason this surprise, optimized for surprise, works, uh, there's another book recommendation. If you go to the next slide. Oh, actually, before I get to that, how we... I'm going to skip this. How we present information affects how people perceive information. I mentioned that with, you know, the railway line. If you put a railway line on a separate map, it doesn't matter how attractive it looks on a separate map, no one's going to use it. In this case, what you see here is the blue numbers around the outside of a speedometer are actually a pace-o-meter. It worked. I've done it in miles per hour because, um, it was, um, I think Al Pear, the behavioral scientist who created it, created it in the United States. Um, what the blue numbers show is minutes per 10 miles. And what you suddenly notice is with every 10 miles an hour you go faster, you save less and less time over any 10-mile distance. Go 30 miles an hour instead of 20 miles an hour, you save 10 minutes. Go 20 miles an hour instead of 10 miles an hour, you save 30 minutes. Go 90 miles an hour instead of 80 miles an hour, you save about a minute. You may have noticed this if you have a satnav or a GPS because if you're going quite fast already and you go faster still, your estimated time of arrival barely changes. If you're going very slowly and you start moving at 40 miles an hour, your estimated time of arrival drops quite dramatically. Nassim Taleb described this as mathematically trivial but completely counterintuitive. The reason I show this in every presentation I give is because I think it might save someone's life fundamentally because, yep, going quite fast is a good idea. You'll get there faster. You'll save a lot of time. Going really fast when you're going quite fast already, it's an idiot's game. Stopping distance, braking distance, likelihood of fatality, severity of accident, fuel consumption, they're all going up exponentially. Time saved is actually flatlining. Once you know that, you don't drive in quite the same way ever again.

Next slide. And I was talking about "optimize for surprise." If you're really interested in the neuroscience of this, there's a guy called Andy Clark who wrote a book called "The Experience Machine." His contention is that most of what we perceive is actually a prediction and the limited bandwidth we use in our optic nerve, our nasal senses, our auditory senses is reserved for those things we weren't expecting. So if you do something that people weren't expecting, it achieves much, much more salience and much, much more attention than something that you were expecting. Here's a suggestion. If anybody runs a hotel chain, um, no hotel I've ever stayed at. I've stayed in some really expensive hotels. I've stayed in some fairly basic hotels. Every hotel comes with a TV. I've never had a hotel that has a monitor. But 50% of my time in a hotel room is now spent working. Now, you could rent me a monitor. If when I booked that hotel room with pool access in Houston, they'd said, "Want a 45-inch monitor, curved monitor, extra $20 a night?" I would have paid in a heartbeat and I would have claimed for it. Okay? It's a work expense. Nobody's done that. Why haven't they done that? Because nobody's thought of it. Because to think of it, you've got to imagine something that doesn't exist already rather than looking at data about things that already exist. Because you're benchmarking against your competitors. You're benchmarking against the past. You're not benchmarking against the future.

So, next slide. We'll get to the end now because I'm, I do need time for Q&A. And you've got a final point. Everybody's obsessed with automating everything. People really, really matter. And this is a wonderful case of misalignment and measurement. Royal Mail back in the 2000s, maybe the late '90s, was obsessed with improving operational reliability. What percentage of first-class mail arrived next day before 9:00 am? And then they looked at the customer satisfaction figures and discovered there was no correlation between the quality of their service and the extent to which their customers, the recipients of the letters, liked the Royal Mail brand. No correlation at all. There were places where they weren't very good, where people loved Royal Mail. There were places where people hated Royal Mail even though the service was incredibly reliable. Alex Bachelor, marketing director at the time, thought something else is going on. I know what it might be. He did the research. Sure enough, the biggest determinant by far of whether people like Royal Mail was whether they liked their postie. If the postman was friendly, if the postman was chatty, if he said, "I knew you were on holiday, so I put the parcel around by the back door." You love that guy. Didn't really matter whether the letters were arriving on time or not. Within reason. You can't have letters going missing. You can't have letters taking a week, but the difference between two days and one day for most letters is imperceptible to most consumers who don't even know when the letter was posted in the first place. And therefore, their hundred million dollars of effort into operational efficiency driven by engineers were having no effect. Whereas actually sending a few postmen to charm school might have had a massive effect. People really matter. Do not use AI as an excuse to close your call center or to downsize your call center. Really good call center staff should be able to earn enormously high salaries because if you have a really, really good human experience, it basically drowns out everything else. I recently bought a car partly because I liked the guy who was selling the car. Estate agents, real estate agents, make absolutely sure that the vendor and the buyer of a property never get to meet before things have been signed. Why? Because if you don't like the person selling the house, you won't buy the house. Doesn't matter. They're moving away. It's irrelevant. As humans, we're optimized to do business with people we really like. And when I say people, I often mean people, not interfaces. And therefore, this idea of automation is desirable to some degree. I quite often order a McDonald's on a screen. It's convenient. I know what I want. I don't want a conversation. But sometimes I do. Also, McDonald's has people standing behind a counter. When my daughters were young, I told them very simply, if ever you're stuck out late at night, head for a 24-hour McDonald's because there are toilets, there's food, there's drink, and you're safe. Okay, you're completely safe within a McDonald's because there are two or three people standing behind the counter checking that nothing untoward happens. Now, if you take away the humans, that's no longer a promise I could make. You've changed the nature of the place imperceptibly. Even if the efficiency of your operations have been improved, the emotional relationship I now have with McDonald's has changed. That's why Starbucks could automate the whole thing. They don't. You know, they're absolutely obsessed with making every single coffee to order.

So, next slide, very quickly. Very simple reiteration. Your call center is also the only place where you learn where you're failing. You learn what people, the problems people can't solve online, the problems they can't solve through the app. One very clever person I knew at Microsoft when he started a new part of Microsoft, he put the call center right in the middle of the developer team. So it provided instant feedback to what features they needed to get rid of, what features they needed to change, and what features they needed to add. The call center is essential in two ways: emotionally, because our human interactions trump our other, our other metrics because we've had a million years of evolutionary experience working out who to trust. If the person we come across isn't trustworthy or likable, all other bets are off. So do not, whatever you do, adopt completely this promise of using AI to improve things that consumers actually don't like. Learn from the Royal Mail in the 1990s. Don't optimize for what you think is important. Optimize for what your customers really care about. In business, you are not your customer. In politics, you are not your voter. Never forget that.

I think that's the last slide. I'll go on to the next one. If you are interested, I think the last slide just promotes this. This is my final point. You can't be a brand and you're not a completely free individual unless, to some extent, I don't mean universally, I don't reinvent everything. I go with social norms a lot of the time, but if you can't choose a few metrics of your own, if you can't design a few metrics which are specific to your own brand or, in the case of a person, specific to your own personality, you're not really an individual and you're not really a brand. So by copying everybody else all the time as a benchmarking exercise, if you really want to know more about this, there's a wonderful Medium post by Roger L. Martin, fantastic business writer, heir to Peter Drucker. He actually worked with Peter Drucker. He's Canadian. I regard him as the natural heir to Peter Drucker. Um, he wrote a Medium post called "Benchmarking is for Losers." I really, really recommend that you read that. Other than that, there are only three, two more recommendations. As I said, read Roger L. Martin.

Next slide. Do this course if you're interested in knowing more. And finally, check out Saloo if you've got time this evening. Thanks very much and over to you for questions.

>> Thank you so much. And I think a lot of information. I think we'll need a few minutes to process. But guys, open the floor for questions. Um, what I would encourage is, as Rory is here with us, so not only what he has said, but if you have any other questions about, you know, anything, uh, please feel free to ask. So, anyone? Okay, so we've got there. Yeah.

>> Um, hi Rory, thank you so much for the session. I think it was absolutely amazing. Um, I wanted to ask, um, could you give some metrics of success? Like, any examples that you think, you know, are relevant if we're not following the traditional, you know, methods like Meta, like, you know, whatever we're tracking so far. I think that's all I've been aware of and been taught. So, I would love to know where should we learn the metrics from?

>> I I think you should have some of your own because I don't think we should have our metrics imposed on us by people who make money from us uh following those metrics exclusively. That's not to say, by the way, I'm going to be very clear. The bottom of the funnel is really important. In fact, I'll go further. The bottom of the funnel is the place to get right first because if you're not converting efficiently, then anything you do further up the funnel is therefore less effective by dint of the funnel being less effective further down. So I'm absolutely not averse to the bottom of the funnel. I'm only averse to the bottom of the funnel being uh optimized to the exclusion of anything else, to the exclusion of fame, affection, whatever. And I would I would like to, for example, I think a surprise and delight metric would be very, very useful. Now, one of those might be complaint handling. A friend of mine who runs a little brunch cafe in the town near where I live, she had her insurance hacked and the insurance company unbelievably not only solved the problem, they sent her flowers the next day. Now, as she put it very beautifully, "I know who I'll be insuring with for the next two years," called reciprocation. An instinctive human urge is reciprocation. Ironically, if you have a problem with a brand and they solve the problem very well, you're more loyal to the brand than if that problem never occurred. I also think that, you know, now I don't know how they measure the cost of those flowers. It's not negligible. But on the other hand, and also it's slow to measure because you can only measure it in terms of customer retention rather than customer acquisition. But one of the things I would look at undoubtedly is there's only one really good measure of a great business, which is, well, it doesn't work for everything. Doesn't work for banking, doesn't always work, say, for medical operations, but repeat purchase.

>> Okay. In other words, you know, one of the things is if it becomes more and more expensive to acquire new customers because Google or or Facebook have a stranglehold over them, it becomes more and more important to retain the customers you have and to maximize their lifetime value. And I think we underweight those measures not because they're unimportant, but because they're slow. You know, you can, you can measure the efficacy of an acquisition tactic in days or even hours, whereas a retention tactic takes years.

>> It's long-term.

>> Um, I would also say that actually, um, you know, what, you know, one metric would be, are we doing anything we don't measure? What are the 10 big ideas we could have that are impossible to measure but are just really, really good ideas? I don't know to what extent you can measure the efficacy of that banana sticker and I don't know the right way in which to measure it, uh, completely, but my argument is that any brand should have certain metrics that are very heavily um weighted to what makes it different, not to what makes it the same.

>> Okay. Thank you.

>> Um, yes, uh...

>> Oh, I'll give you one brilliant metric. Two, two brilliant metrics. There's a, uh, there's a, a transportation system in San Antonio, Texas called The Local. And it's little electric vehicles which drive people around for free. And they wanted a different metric for satisfaction. And I said, it's the number of times a passenger laughs because they're they're funny little vehicles. They're eccentric little vehicles. And it's a bit weird. And I said it's perfectly acceptable to have a metric around laughing. Uh, the metric around the original iMac designed by Jony Ive uh for Apple, those, you know, that was before you had flat screens, the colorful thing was whether you wanted to lick it. Okay. They put a handle on it, by the way, for entirely psychological reasons because they said the reason we're putting a handle on is not because we expect people to carry it from room to room, although they might occasionally. It's that we want people to feel that the computer is something they can touch.

>> Uh, hi Rory, it's a dream to uh talk to you although virtually. So my question is, uh, when you talk about these, uh, problem identification and perception, etc., the customer is very important to get the actual data and the actual problem insight. So are you in favor of focus groups or ethnography, or are you looking for a mix of that? And what about things like NPS and other things as well for customer feedback and insights?

>> I think, I think, I mean, I wouldn't discount any of those. I have certain doubts about conventional market research, uh, with depth interviews, one-on-one and ethnographic research where the research takes place in context, I think are disproportionately more valuable. Now, it's worth saying a lot of data does have one virtue, which is it's behavioral rather than attitudinal. You know, even if it's just click-through data, the click-through is something that somebody actually did. But, um, one of the things that you've got to be careful of is is getting trapped in a particular measure. So, there's a great thing called Goodhart's Law, which is any metric that becomes a target loses its value as a metric. And there's a fantastic um new idea which creates, I think, a new metric. But anybody who's involved in online um advertising, I think I just need to um to get the right URL for them. They're called Tickle and it's a new business. Uh, here we are. Tickle Global and the website is jointickle.com. And it's a banner ad where the call to action is not "Click here." "Interrupt what you're doing. Ignore the fact that you're trying to pay a parking fine online at the moment and go and look at our web page instead." The call to action is "Save to Wallet." So you save it to Apple Wallet or you save the ad to Google Wallet. That ad could contain a discount. It could contain just information, but it's saved till later. So that's a really interesting thing because it's a different metric. Now, if you're obsessed with measuring, you know, click-through rates, that you will discount that idea, even though it's a really good idea, which sometimes achieves 10 times the efficacy of a conventional ad because the metrics you need to evaluate that kind of advertising are different than the metrics you've historically used. And if you're obsessed with comparison, it makes it impossible to innovate. So, I'll give you an example. Nearly all innovations are bad. Range anxiety in electric cars. Um, the battery life of the first iPhone was terrible. Okay, if you, if smartphones had been bought by procurement, the first iPhone would never have taken off because they would have just said, "The battery life's unacceptable." It turned out people were prepared to cope with worse battery life for a much better phone and they took a charger into work or they bought a case with a huge great bulbous battery in it. So I think you've got to be, I think you've got to, I think you've got to be agile in terms of your metrics. I think you've got to say, well, actually, we used to measure on this, but now there's a better way. Whereas, if you're obsessed with self-justification and comparison and just justifying yourself, I mean, this is a problem with procurement. If you come up with a really innovative idea for, as an ad agency, procurement go, they say, "Can you quote us for two TV ads and five press ads?" It's a stupid bloody question to ask in the first place, but they say that you, well, actually, we've looked at your business problem. You don't need to do any TV ads because you can solve the problem by changing the choice architecture on your website or, um, putting the kiwi fruit in a different box, right? And procurement do not go, "Wow, that's a brilliant idea. Thanks. You've saved us a fortune." They go, "No, we're not interested because we need to compare your costs like for like with four other agencies so we can beat you down on price. So, we're not interested in good ideas which mean we have to spend less money. We're only interested in making you cheaper." And so the need for direct comparison is a fundamental obstacle to innovation.

>> Okay. Thank you. Um, anyone else? Yeah.

>> Hello. Yeah. Hi Rory. Great uh talk.

>> Hello there. Uh some of the ideas that you're talking about which were long-lasting like the one for British Airways and for hotels, right? But they seem brilliant in hindsight. In your experience, what are the signs we as marketers should be looking for to kind of figure out, okay, okay, which ideas because again, as you said, you have to experiment, you have to try all these different things, but what are the early signs of what we should be looking out for to see which ideas may have the potential to become that kind of long-lasting uh success stories?

>> I I think behavioral economics and behavioral science is very valuable there because it provides a framework for understanding marketing activities which seem counterintuitive. I'll give you an interesting example of this by the way, which I've suggested to a lot of our service clients so far without success, which is weirdly, if you ask a customer to do a favor for you and you ask them really nicely, even though they've done you a favor, they like you more than they did before. And it's just a human, it's anthropology, really. It's just the way we're wired. And I've often said to British Airways, have you ever tried this? You know, let's say you have an overbooked flight at 7:00 p.m. going to JFK from Heathrow and you have a half-empty flight at 8:30 p.m. If you contact your customers in a really nice, charming way and say, "Look, I'm, you can, you've still got a flight on the 7:30 flight, but, um, it would help us out a bit if you switched to the 8:30. Don't worry if you don't want to, but if it's, if it doesn't make any difference to you, it'd be, you know, be really helpful." And then maybe if they do do that, you send them a little thank you, okay? You know, it could just be, you know, a thousand Avios points or whatever. Okay? But don't, don't make it a bribe. Don't say, "If you move your flight, we'll give you a thousand Avios points." That's what, that's what an economist would do. Instead, say, um, "Oh, that was really kind of you helping us out. To thank you, we've given you this." And then they'll like you more. And yet, nobody tries this because it seems like it's inconveniencing customers, but actually it isn't. They like it. People like being useful. Who would have guessed?

>> Yes. Thank you.

>> There's one more there.

>> Hello Rory. Uh thank you so much for being here. Um, you presented a great problem of agency workers being exploited for their work and like having their ideas used to build billion-dollar companies and stuff like that. This is a great problem and tail as old as time is workers being exploited. Do you have a solution or like possible solutions for this as well?

>> Yes. Um, I think one of the reasons why those family companies are more successful, which I didn't talk about because obviously I'm talking typically here about B2B or B2C marketing, but B2E marketing, how you treat and look after your staff, I think is inordinately more important. And what we have is we have a model that tries to treat employees as if they're fungible and infinitely replaceable to reduce the cost because it's effectively a very operationalized Taylorist model of employment. Enterprise Rent-A-Car, Costco, there are these extraordinarily successful American businesses. I think it's true of HB as well. Treat their employees incredibly well. If you're, I think, you know, if you run an Enterprise Rent-A-Car outlet, you're making six figures in your 20s. They, they pay them and treat them incredibly well because they properly evaluate the effect it has on their business. And you may know if you Google "the dormant fallacy" and my name, you'll see a case where I argue for this, that actually, um, particularly customer-facing staff, but actually I think it applies equally well in everything else. What we have done is we have created a crisis in, okay, in Taylor's job, you could measure exactly the output of the worker. In knowledge work or indeed in call center work, in anything involving some degree of discretion on the part of the person performing the work, you can't actually measure output accurately. So the thing you have to optimize for is motivation. And I would argue that a large number of companies, including my own employer, by the way, I will be absolutely brutal on that, in WPP, have done a very, very bad job of employee motivation over the last 5 to 10 years. Now, the only reason they've got away with it is that younger people don't realize it was ever any different. You know, if you only joined a business in the last 5 to 10 years, you think this is what work was like. But work used to be much more collaborative, much more entrepreneurial, and now what it's become is rule-based. And people really value in work. There's a wonderful model by David Rock, who's a neuroscientist in New York. It's called the SCARF model, and it stands for Status, Certainty, Autonomy, Relatedness, Fairness. And one of the things I would really, really recommend any business does is it looks at how it looks after its staff and goes, "Can we be sure we're conferring status on those? You know, how are we making those people feel important? How are we making them feel confident about, uh, their future employment? Uh, how are we offering them autonomy, allowing them to make subjective decisions rather than forcing them to obey an algorithm, you know?" Um, and I don't, I don't think I think we've done a terrible job of employment, uh, in the last 5 to 10 years from an anthropological perspective. I, I think we've, we've just accounted for salary and hours and not motivation. I mean, there are some wonderful things you can do, by the way, which is, if you, let's say you run an agency, one thing I would really, really recommend, which is a way you can actually offer people incredible value at very low cost, is to give people four weeks a year of work from anywhere. Now, I'm currently in the Canary Islands, but as you can see, I'm also working. And this morning I was also replying to my emails. I was doing some work. Later on, I might go for a swim in the sea. Now, I'm still doing eight hours' work, but I'm just doing it in a sunny background, and it's a bit of a change. Now, that doesn't cost you anything, but to me, it's enormously valuable. It's almost as valuable as having holiday vacation time, but at 10% of the cost to my employer. So, looking for really intelligent value exchanges like that, I think could be really, really magical. It's also, by the way, the work from anywhere thing is really important. If you've got people, um, for example, who have caring responsibilities, they have elderly parents. Now, they, they may not want to take two weeks' vacation to go and stay with their parents because their parents will get sick of them for 16 hours a day, but allowing them to go and stay nearby or, you know, stay in a nearby Airbnb and pop in every day for a week and see their parents or their, you know, anybody who needs looking after while still doing useful work remotely. Seems to me an altogether, it seems to me something where everybody wins. And I think we're wrong to treat that with suspicion.

>> Cool.

>> Thank you so much.

>> That's a Okay, Fad.

>> Can we have the mic here and I think last question perhaps. Oh, you also have one. Okay. Hello. I'm sorry to...

>> Currently, by the way, apologies to everybody, which is that Saloo is actually in Lahore, not in Karachi. There's no longer a Saloo in in in Karachi. My apologies, but if you're in Lahore, you know where to go.

>> F. So, um, um, my just one comment and one question. One commentary is that you talked about family businesses and in the last two days we've talked a lot about it in Karachi and we've seen that some of the larger FMCG businesses here are family businesses and one of the, one of the learnings there is they are faster to react to the market. You know, the, I, I think the challenge we've had here in Pakistan is some of them perhaps are not that, uh, clear on the branding opportunity, but they're very quick in the market and stuff. So there is a trade-off in family businesses. I work in a cosmetic business and one of the things that it's very easy for us to do

>> is experimentation, which perhaps at a multinational would not have been possible. So I think your comments there, uh, that you do it and then justify it are very relevant to to this market.

>> And and there's a fundamental thing which is that as a family-owned business, you're focused on the customer, not on the shareholder.

>> Mhm.

>> And the economist Dan Davies, who was formerly an economist at the Bank of England, his observation was that as a family business, if you focus on your customer, you're focused on the real world and you're focused on the future and you're focused on the world of possibilities. If you're focused on your shareholder, you're focused on artificial measures and you're focused on the world of cost reduction and efficiency, not not on the world of of discovering new opportunities.

>> you on the short term and perhaps

>> Yes. And and absolutely on the short term.

>> Yeah.

>> Yeah.

>> Because let's face it, you know, the family has their name above the door. They have rep and they have a sense of posterity. They want to pass business along to their children.

>> Mhm. Mhm.

>> Whereas the CEO probably wants to get out in four years with a big payoff. Uh, which is best achieved by gaming the share price through share buybacks and other other trickery like that.

>> But it's not the real world. So my question, Hello. Yeah. So my my question, uh, is that in Pakistan, we see, uh, there's a boom in e-commerce and you're moving from brick-and-mortar stores to e-commerce. And I'm running a cosmetic business and one of the challenges we had is it's grown in the last four years from 3% of our business to, uh, around 40%. And there was, um, a movement that we should outsource it. And we decided against doing it. And I think the benefit we've seen is being able to reach out to customers. We've obviously used WhatsApp for, uh, WhatsApp for Business and tried to get through to them. But what I wanted to share with you is the experience of being able to talk to a customer and if they have a problem with the shade and say, "Okay, we don't have a policy of return, but go ahead, let's do this, let's do that." Has really given us some customers which, like you said, it's not a favor, but they've become customers for life. And I think there is a tendency now, uh, even in Europe, where you don't have to go to influencers, you go to your most valuable customers and they become your voice for the brand. And perhaps there is something there that you can talk about and say, if there's some experience, I know Victoria's Secret is doing that. There are a few other companies who are using their most, uh, segmented consumers as voices for the brand.

>> I completely agree, by the way. I, I've got a whole separate presentation on influencer marketing and the, the extent that influencer marketing, if you like, is fractal. It's scalable.

>> And sometimes it might be someone who's very famous, who's very credible at the level of a celebrity, but it can equally be someone. You're absolutely right. And also you create these weird elements of niche fame where there is often someone who is just hugely credible in the cosmetics world, for example. You know, I've probably never, by definition, I've never heard of them, but in Pakistan, in the field of cosmetics, you can find those people who just carry disproportionate weight. And there's a value to that, which is, I think, because they have reputational skin in the game. That's a way of using digital media to create credibility. I think most digital media transmits claims, but it doesn't actually create conviction. And I think when you reintroduce a human, you know, speaking about something, it actually convinces people. It doesn't merely just seek to engage in a transaction. And I think that can, I mean, thinking about it, by the way, I bought a car about six weeks ago. And I'm, I'm a very heavy YouTube Premium user, admittedly. Um, I probably watched, thinking about it, 24 hours of online reviews before I bought a car. That was, now, if you think about that in advertising terms, you know, that's insane. Okay, the value of that is insane. You know, I mean, the cost, you know, the cost of giving me 24 hours' worth of information over something, uh, you know, was astonishing. But I did it. I did it myself. And, um, uh, that kind of content, by the way, and quite a lot of it, you're absolutely right, was just from people who bought the same car that I was thinking of buying.

>> Mhm.

>> Nothing more than that.

>> Yeah. Okay. So I think last question. We have just last before my last def. Thank you so much, uh, for such a mind-expanding session. And I just wanted to ask that in a world that is really obsessed with performance marketing right now, where does the creativity sit?

>> Oh, don't. Thank you. What, what a perfect question on which to end. What has happened? You know, I mentioned technoplasmosis. Meta and Facebook can't claim to have a monopoly on creative ideas. They can claim to have a monopoly on, you know, highly segmented databases of customer behavior. Consequently, the amount of experimental weight and expense that's been put into targeting relative to creative has now gone completely. Now, I worked in Ogilvy, bear in mind, from 1988. Now, I'll be absolutely honest with you. In 1988, 1990, 1992, 1994, 1996, there was too much focus on creative relative to media and targeting. And I welcomed initially the fact that when digital marketing came along, there was a rebalancing. And then I suddenly discovered that we've created this weird world. We've got to be very careful of tech because companies when they spend money on tech don't really look at the opportunity cost. They go, "Tech, it's efficient, it's automated, it's essential for competitive advantage." Therefore, let's just spend as much money on tech as we possibly can. And I always say, well, look, the only thing is that for 10% of the money you spent on some tech stack, you could have employed the world's best copywriter for her or his entire working life. Maybe that would have actually helped you out a lot more than, you know, coming up with an absolutely fantastic verbal encapsulation of what your brand stands for or coming up with a distinctive visual style or any of those things that might massively increase, um, you know, mental availability and, you know, comprehension of what makes you different and so forth. And, and, you know, any of those things, I mean, would probably be more valuable, but it's not quantifiable and it's not predictable. And finance is basically addicted to the drug of predictable, quantifiable, incremental efficiency improvements as distinct from playing poker, which is, as a copywriter, you know, I don't know, five times in my life, 10 times in my life, you come up with something which just changes the game altogether. And no one's looking for that anymore because their time horizons are too short. But, you know, when I look at those companies, Buc-ee's, HB, T-Bay Services, um, you know, all of them really are creative successes. You know, they're, they're just, they're just the encapsulation of a brilliant idea, brilliant human insight. And the data tells us what people are doing. It doesn't tell us why. And it tells us nothing about the people who aren't doing anything at all and what the bottleneck may be. So we're, we're, we're basically spending 90% of the budget on 10% of the opportunity, I would argue. And you're absolutely right. I mean, it's insane.

>> Okay.

>> Dove again. What, what was that worth? You know, again, it's one of those things where if you come up with a creative breakthrough, it's yours to keep. If you come up with a targeting breakthrough, um, it won't be long before someone else notices and, um, uh, the market prices for what you're doing, some then normalize and it's no longer a breakthrough anymore.

>> Okay. Thank you. Um, no more questions. I think we would have loved to carry on with the discussion. I would really like, we could have talked about the evolving agency model, but I think for some other time. Um, so I think thank you so much Rory. Thank you so much for your time. I hope everyone enjoyed.

>> It was a pleasure.

>> Let's see if I can make it in person next year. I'd love to make it in person in 2026.

>> So we're going to take or...

>> If that's too soon, 2027.

>> Soon. Yes. If not next year, then the year after that. So I think in front of all the witnesses, I think we have so many witnesses. So, you know, we're going to take you on that. Thank you so much.