Forked

engineers, medical people, scientific people, have an obsession with solving the problems of reality, when actually most problems, once you reach a basic level of wealth in society, most problems are actually problems of perception.

education doesn’t actually work by teaching you things. It actually works by giving you the impression  that you’ve had a very good education, which gives you an insane sense of unwarranted self confidence, which then makes you very, very successful in later life.



Fredrick the Great of Prussia was very very keen  for the Germans to adopt the potato, and to eat it. Because he realized that if you had two sources of carbohydrate, wheat and potatoes, you get less price volatility in bread. And you get a far lower risk of famine, because you actually had two crops to fall back on, not one.

The only problem is: potatoes, if you think about it, look pretty disgusting. And also, 18th century Prussians ate very, very few vegetables — rather like contemporary Scottish people. (Laughter) So, actually, he tried making it compulsory. The Prussian peasantry said, “We can’t even get the dogs to eat these damn things. They are absolutely disgusting and they’re good for nothing.” There are even records of people being executed for refusing to grow potatoes.

So he tried plan B. He tried the marketing solution, which is he declared the potato as a royal vegetable. And none but the royal family could consume it. And he planted it in a royal potato patch, with guards who had instructions to guard over it, night and day, but with secret instructions not to guard it very well. (Laughter) Now 18th century peasants know that there is one pretty safe rule in life, which is if something is worth guarding, it’s worth stealing. Before long, there was a massive underground potato-growing operation in Germany. What he’d effectively done is he’d re-branded the potato. It was an absolute masterpiece.

I told this story and a gentleman from Turkey came up to me and said, “Very, very good marketer, Fredrick the Great. But not a patch on Ataturk.” Ataturk, rather like Nicolas Sarkozy, was very keen to discourage the wearing of a veil, in Turkey, to modernize it. Now, boring people would have just simply banned the veil. But that would have ended up with a lot of awful kickback and a hell of a lot of resistance.  Ataturk was a lateral thinker. He made it compulsory for prostitutes to wear the veil.

But the first thing this all shows is that all value is subjective. Second point is that persuasion is often better than compulsion. These funny signs that flash your speed at you, some of the new ones, on the bottom right, now actually show a smiley face or a frowny face, to act as an emotional trigger. What’s fascinating about these signs is they cost about 10 percent of the running cost of a conventional speed camera. But they prevent twice as many accidents. So, the bizarre thing which is baffling  to conventional, classically trained economists, is that a weird little smiley face has a better effect on changing your behavior than the threat of a £60 fine and three penalty points.

Tiny little behavioral economics detail: in Italy, penalty points go backwards. You start with 12 and they take them away. Because the found that loss aversion is a more powerful influence on people’s behavior. In Britain we tend to feel, “Whoa! Got another three!” Not so in Italy.

Another fantastic case of creating intangible value to replace actual or material value, which remember, is what,  after all, the environmental movement needs to be about: This, again, is from Prussia, from, I think, about 1812, 1813. The wealthy Prussians, to help in war against the French, were encouraged to give in all their jewelry.  And it was replaced with replica jewelry made of cast iron. Here’s one: “Gold gab ich für Eisen, 1813.” The interesting thing is that for 50 years hence, the highest status jewelry you could wear in Prussia wasn’t made of gold or diamonds. It was made of cast iron. Because actually, never mind the actual intrinsic value of having gold jewelry. This actually had symbolic value, badge value. It said that your family had made a great sacrifice in the past.


except for among perhaps five or ten percent of the most knowledgeable people, there is no correlation between quality and enjoyment in wine, except when you tell the people how expensive it is, in which case they tend to enjoy the more expensive stuff more.

But this is both hysterically funny — but I think an important philosophical point, which is, going forward, we need more of this kind of value. We need to spend more time appreciating what already exists, and less time agonizing over what else we can do.

 this guy named Otto Rohwedder invented sliced bread, and he focused, like most inventors did, on the patent part and the making part. And the thing about the invention of sliced bread is this — that for the first 15 years after sliced bread was available no one bought it, no one knew about it. It was a complete and total failure. And the reason is that until Wonder came along and figured out how to spread the idea of sliced bread, no one wanted it. That the success of sliced bread, like the success of almost everything we’ve been talking about at this conference, is not always about what the patent is like, or what the factory is like, it’s about can you get your idea to spread, or not. And I think that the way that you’re going to get what you want, or cause the change that you want to change, to happen, is that you’ve got to figure out a way to get your ideas to spread.

people who can spread ideas, regardless of what those ideas are, win.

At the heart of spreading ideas is TV and stuff like TV. TV and mass media made it really easy to spread ideas in a certain way. I call it the TV industrial complex. The way the TV industrial complex works, is you buy some ads — interrupt some people — that gets you distribution. You use the distribution you get to sell more products. You take the profit from that to buy more ads. And it goes around and around and around, the same way that military and industrial complex worked a long time ago.

 the TV industrial complex is broken, I don’t think that’s a strategy we want to use any more. I think the strategy we want to use is to not market to these people because they’re really good at ignoring you. But market to these people because they care. These are the people who are obsessed with something. And when you talk to them they’ll listen because they like listening — it’s about them. And if you’re lucky, they’ll tell their friends on the rest of the curve, and it’ll spread. It’ll spread to the entire curve.