The

Objectivity
Trap
On the biases and misconceptions
that cause us all to undervalue
B2B Marketing.
Table of
Contents
04 INTRODUCTION

05 OPINION
NEW FRAMEWORKS FOR MARKETERS IN A DISRUPTIVE ERA

07 ABOUT THE WRITER

08 FOREWORD

11 THE OBJECTIVITY TRAP

19 BUSINESS NEEDS MORE THAN ONE MAP

23 MARKETING IS NOT MARCOMS; IT’S A MINDSET

27 IF YOU ONLY BELIEVE IN LOGIC, YOU CAN’T PERFORM MAGIC

33 NO ONE EVER GOT FIRED FOR THINKING LIKE A COMPUTER

39 THE LONELINESS OF THE LONG-TERM MARKETER

41 IF YOU WANT GROWTH, AVOID REDUCTIONISM

48
IN SUMMARY

50
BEHAVIOURAL SCIENCE PRINCIPLES PROFILED
4

Introduction

David Ogilvy invented modern advertising. He burst onto the postwar Madison Avenue scene largely
through force of personality and by making a lot of noise. As an immigrant to the US and a failed
gentleman farmer, he dressed as the flamboyant British ‘gent’ he was – layers of Scottish tweed and
on occasion even a kilt. He smoked a pipe and drove a Rolls Royce around Manhattan. He spoke
and wrote in highly quotable one-liners - many of them profound (“We sell, or else”), and some of the
profoundly silly, like “Develop your eccentricities while you are young. That way, when you get old,
people won’t think you’re going gaga.” But Ogilvy was also trained in scientific market research by
the Gallup organization. He understood the power of fame, and his iconic campaigns and bestselling
books endure to this day as the gold standard for marketing and creativity. Despite his patrician air, he
believed in marketers honouring the intelligence of their audience.

Rory Sutherland is in many ways David Ogilvy’s spiritual heir and cut from the same colourful and
intricately woven cloth. Straight out of Cambridge, he landed at Ogilvy’s agency as a graduate trainee.
He is rumoured to have met the legendary David only once, but he certainly learned from the master.
I don’t just mean the loud tweed jackets and khaki three-piece suits with short trousers. I am not even
talking about the Jackie O sunglasses, an ever-present cloud now attributed to vaping devices and
references to sloe gin and Welsh sheep farming. I am talking about Rory's belief in “big ideas”, and his
highly quotable and profoundly influential writing and public speaking on how behavioural science
should shape marketing. What Baudelaire is to poetry, Rory is to marketing podcasts. When our B2B
Institute colleague Peter Weinberg was in college, Rory’s first TED talk captivated him so much that
he decided on the spot to embark on a career in marketing because of it (and I am glad he did.)

Reading Rory (or even better, listening to him talk live in person) is a tremendous amount of fun, like
listening to your favourite professor as an undergraduate. A natural raconteur, his ability to teach,
inspire and provoke is remarkable, as is his ability to talk for hours with gusto to anyone who engages
him in conversation. The world of marketing as seen through Rory’s eyes becomes exciting and full
of creative possibilities and surprising plot twists. But don’t let the anecdotes and droll delivery fool
you. This is ground-breaking, transformational thinking that has the power to deliver huge business
value. As Rory teaches us – marketing is a mindset, not a cost-centre; human beings are not rational,
so magic is often preferable to reason when solving marketing problems; all value is perceived
value; think of the world as probabilistic, not deterministic; people choose brands to mitigate
disappointment or blame – the list of valuable mental models is endless.

These are times where we could all use a little magic, and mental models for innovation that don’t
require large budgets. Nowhere in marketing is this fresh perspective more needed than in B2B
marketing and, in this unique publication, we are excited to share Rory’s take on it with you.

GLOBAL DIRECTOR OF THE B2B INSTITUTE

Jann Schwarz
 5

T H E OBJECT IVIT Y T R A P
OPINION

New Frameworks for Marketers in a Disruptive Era

When circumstances are new, as they are today, the rule book often needs to be revisited, analysed,
and perhaps updated. The use of psychology and insight within business is not a revolutionary
proposition. However, we believe the psychological insight you find in behavioural science can
give us fresh eyes in our approach to B2B Marketing.

This white paper by Rory Sutherland, one of the most innovative marketing minds and writers
of today, is the first time he has written an extended essay on B2B Marketing. For years Rory has
studied behavioural science as a way for marketers to think differently, and indeed many brands
have adopted these techniques especially in consumer marketing – but they are by no means a
standard approach. Rory looks for ways we can question presumptions and challenge norms, not to
increase disruption, but in the face of disrupted times to find new tactics for business success, and
in some circumstances survival.

‘The Objectivity Trap’ is a rallying cry for greater understanding of the motivations, priorities and
needs of the people businesses deal with day to day; to reject many accepted wisdoms about the
rationality of the decisions made by organisations; to make sense of the behaviours that affect these
relationships, on individual and group levels; to empower each of us to respond even where on first
sight these ideas may not make sense or fit with previous experience.

Rory champions innovation that adds value to businesses which doesn’t require great financial
investment to production, supply, distribution or ways of working. He talks of Marketing as a
mindset not a media budget. While this approach is useful in a boom, it can be business-saving and
culture defining in a crisis.

This creativity to innovate we hope inspires our readers to develop a new decade of innovation to
strengthen their businesses for the benefit of customers and consumers. In Rory’s book ‘Alchemy’
(2019) he quotes the great ad agency genius Bill Bernach – ‘Conventional logic is hopeless in
marketing – as you end up in the same place as your competitors’, and we hope it will help you find
your new ways of framing the future.
6

We live in a time of massive access to data, and venturing beyond the relatively safe walls of formal
market research can feel daunting and uncertain. Application of Behavioural Science can give
fresh structures, and empirical understanding of patterns of undeclared behaviour that can’t always
be explained through traditional research. If most people don’t know that they’re doing something
they surely can’t be expected to then tell you why. Outlining the opportunities that this practice
can reveal can open up new business opportunities, greater profitability, and give confidence to
innovators, and even their nervous or sceptical colleagues.

Here with Rory Sutherland and his colleagues from Ogilvy Consulting we venture into the un-
charted lands of understanding unconscious bias within business, customer decision- making,
buying committee shortlisting and how corporates think - a territory that inspires distinctive,
revolutionary rather than evolutionary change.

EMEA LEAD B2B INSTITUTE HEAD OF EMEA, B2B INSTITUTE

Jenny Shaw-Sweet Victoria Pattinson

 7

T H E OBJECT IVIT Y T R A P
About The Writer

Rory Sutherland
Vice Chairman, Ogilvy UK

Rory Sutherland is the Vice Chairman of

Ogilvy, co-founder of their behavioral science
practice, and B2B Institute Research Fellow, a
group of distinguished expert practitioners and
academics undertaking research about the future
of the marketing sector.

Sutherland works with a consulting practice

of psychology experts who look for ‘unseen
opportunities’ in consumer behaviour - the
often small contextual changes which can have
enormous effects on the decisions people make -
for instance tripling the sales rate of a call centre
by adding just a few sentences to the script.

Before founding Ogilvy Change, Rory was a

copywriter and creative director at Ogilvy for
over 20 years. He has been President of the
IPA, Chair of the Judges for the Direct Jury
at Cannes, and has spoken at TED Global. He
writes popular columns for the Spectator, Market
Leader and Impact, and last year published
the best-selling book “Alchemy, The Surprising
Power of Ideas Which Don’t Make Sense” 2019.
8

Foreword

"What is needed is not an interpretation of the utility

created by marketing, but a marketing interpretation
of the whole process of creating utility."
Wroe Alderson 1957

I write this from Britain, which is now on the uncertain road to recovery following the initial shock of
the COVID crisis. Other countries and cities are still deep in that first phase.

At this point it is impossible to know the lasting effects on business behaviour. But it has certainly
become doubly clear that narrow ideas of self-interest are completely insufficient to describe and
predict human action. Employees, from healthcare workers to postmen, have continued in their
jobs at some personal risk through a sense of professional and social duty. Organisations public
and private have gone to extraordinary lengths to look beyond short-term financial self-interest,
even cooperating closely with rivals in furtherance of solutions. You could say these behaviours are
atypical. But there is a different way of looking at it. Perhaps it is at moments like this, in showing
our ability to cooperate in response to common threats, that we are at our most human.

In the last ten years, Behavioural Science has helped provide a framework for a new and more
nuanced approach to understanding behaviour – and with it added a new facet to consumer
marketing. It has done this by challenging two convenient but erroneous assumptions about how
people decide and act. First, it has confirmed scientifically something many marketers have
long suspected – that consumers cannot always accurately describe their motivations or predict
what factors might be decisive in influencing their behaviour . Second, it has catalogued many
instances where patterns of human behaviour consistently deviate from those predicted by
conventional, self-interested economic axioms.

These twin findings elevate the value of bringing a creative and experimental marketing mindset to
bear on problems, since they suggest that the twin lenses once confidently used to inform business
decision-making about customer behaviour – namely mainstream economics and market research
– are not sufficient for good decision-making.

1
In words often attributed to David Ogilvy, “The trouble with market research is that people don’t think what they feel, they don’t say what they
think and they don’t do what they say.” A more scientific explanation can be found in Timothy J Wilson’s Strangers to Ourselves.
2
In my book Alchemy, I call these two lenses “the broken binoculars”. Business decision-making is both clouded and distorted by an over-
reliance on economic theory and by an over-literal reliance on the statements of research respondents.
3
The Pensions Regulator - Automatic enrolment Commentary and analysis: April 2018-March 2019 UK
4
As defined by Investopedia, B2B, short for business-to-business, “refers to business that is conducted between companies, rather than
between a company and individual consumer.”
5
In the field of behavioural science, a cognitive bias refers to a systematic error in thinking that affects the decisions and judgments people make.
 9

T H E OBJECT IVIT Y T R A P
The fact that there is much more to human behaviour than we thought is an annoyance to
those with a love of false certainty, but a gift to the intuitive marketer: it allows you to consider
and experiment with a range of behavioural interventions which would previously have been
rejected as illogical, or which might have been rejected in market research.

Here are just three examples: Purchases from a telephone response line doubled when four
words added social proof to a choice: “Most people do this.” The proportion of UK staff in a
workplace pension scheme increased by more than 32% when employees were enrolled by
default, but given the opportunity to opt out . An airline comparison website increased its sales
by slowing down the speed at which it delivered search results. None of these interventions
would have made much sense to an economist: in market research it is unlikely than many
people would admit to being affected by such oblique interventions.

And yet they work.

Hence Behavioural Science provides a valuable counterpoint to the reductionist, Taylorist view
of business as a logical, quantifiable battle for efficiency gains in a commodity space. Without
some acknowledgement of human psychology and epistemology, without understanding
the need for framing and storytelling, you can be as logical as you like and still fail. You could
produce a product that is both objectively better and cheaper than your competitors’ products
and find it fails to sell.

No one is claiming that Behavioural Science is an exact science. But it does present the
marketer with an entirely new experimental space. And one which is more valuable since it
allows for butterfly effects: cases in which very small and inexpensive changes can lead to
extremely valuable results.

Our fear is that this quiet revolution will fail to deliver the same value to B2B marketing as it
has and will deliver to consumer marketing. The prevailing assumption may be that the twin
lenses still work well for B2B marketing, since business decisions, unlike consumer decisions,
are “entirely rational”, and made by people who are perfectly capable of describing their
needs. We believe this is untrue. In fact, we believe that Behavioural Science may end up with
a greater role to play in B2B than in B2C marketing. Apart from anything else, the question of
business biases has been explored very little, so the potential is immense.
 T H E OBJECT IVIT Y T R A P
11

The objectivity trap

12

YOU DON’T BECOME RATIONAL THE MOMENT YOU PUT

ON A SUIT.
To date, most discussion of “biases and irrationalities” revolves around individual behaviour – most
often consumer behaviour. What receives much less attention is the presence of widespread bias in
collective, institutional or corporate decision-making. Yet, in terms of its importance – and the scale
of its effects – collective bias may be far more significant than individual bias. Indeed, like viruses,
biases are worst when they are present in large groups of people.

For one thing, individual biases may, at the aggregate level, cancel each other out. Decisions and
preferences arrived at independently might be individually irrational, but the market mechanism can
still aggregate these different preferences to cater for what most people care about most of the time.

This isn’t necessarily true in collective decision-making. In cases where corporate fashions or
business-school dictums hold widespread influence, or where there is a single “approved” way of
looking at the world, any bias is likely to be widespread and deeply entrenched. Moreover, once
such institutional bias attains the level of “received wisdom”, confidence in decisions made under
the influence of this bias is likely to be very high, and there is a correspondingly high social and
reputational risk involved in challenging the bias. In this environment, people’s biases do not cancel
each other out – they multiply.

Solomon Asch experiment

A B C
Exhibit 1 Exhibit 2
 13

T H E OBJECT IVIT Y T R A P
RECEIVED WISDOM. WHEN IT’S CONVENIENT FOR
EVERYONE TO THINK THE SAME WAY.
I refer to this as The London Underground Map problem. In many ways, the map of the London
Underground, (‘the Tube Map’, in local parlance), is a very good map. But like all representative
diagrams, it emphasises some forms of information at the expense of others: for instance, in this map,
geographical fidelity – the accurate representation of distance – is sacrificed in the pursuit of clarity.
This distortion would not be so much of a problem if everyone used a different map: however, when
everyone uses the same map, the same misjudgements are multiplied many thousands of times:
hence tens of thousands of tourists use the tube to travel from Covent Garden to Leicester Square,
say, even though in reality it would be far quicker and easier to walk. The distance is under 0.2 miles.
This isn’t just a failing of the London Underground; both the Metro and New York subway are equally
misleading in their similar ways.

London Underground Map

Tube map

1 2 3 4 5 6 7 8 9

9 8 7 8 7 6 5 8 7
Check before you travel
Chesham
Chalfont &
Latimer
Outside fare zones
Watford Junction
Enfield Town
Cheshunt

Theobalds Grove
Epping

Theydon Bois
9 Outside
fare zones
§ East Ham
No step-free access to the eastbound
District line from Tuesday 23 July 2019

6
Watford High Street Bush Hill Debden Shenfield until early January 2020.
Watford Cockfosters Park Turkey Street
Amersham High Barnet Loughton ---------------------------------------------------------------------------
A A § Heathrow

5
Chorleywood Bushey Oakwood
Croxley Totteridge & Whetstone Southbury Chingford Buckhurst Hill
TfL Rail customers should change at
Rickmansworth Southgate Brentwood
Carpenders Park Terminals 2 & 3 for free rail transfer

4
Woodside Park Edmonton Green
Moor Park Roding Grange to Terminal 5.
Hatch End Mill Hill East Arnos Grove Valley Hill
West Finchley Silver Street
Highams Park ---------------------------------------------------------------------------
Northwood Edgware
West Ruislip Headstone Lane Stanmore Bounds Green Chigwell Harold Wood § Hounslow West
White Hart Lane
Northwood Hills
Woodford Hainault Gidea Park Step-free access for manual
Hillingdon Ruislip Harrow & Burnt Oak Finchley Central Wood Green
Canons Park Bruce Grove wheelchairs only.
Ruislip Manor Pinner Wealdstone Harringay Romford
Wood Street South Fairlop ---------------------------------------------------------------------------
Green South

4
Colindale East Finchley Woodford

3
Uxbridge Ickenham Queensbury Turnpike Lane Lanes Tottenham
North Harrow § Services or access at these stations are

6
Eastcote Barkingside
Kenton Hendon Central Highgate Crouch Blackhorse Snaresbrook Emerson Park
Harrow-
Kingsbury
Hill Road Chadwell subject to variation.
Seven Newbury
on-the-Hill Preston Road Manor House Sisters Heath To check before you travel, visit
Brent Cross Archway Walthamstow Park
Rayners Lane Redbridge
Ruislip Neasden Central tfl.gov.uk/plan-a-journey
Gardens West Northwick Tottenham Goodmayes

3
Harrow Park Golders Green Hale Wanstead Gants

B Outside South Kenton Wembley Park

Dollis Hill
Upper Holloway Stamford Walthamstow Leytonstone
Hill Seven Kings Upminster
B
fare South Harrow
North Wembley
Willesden Green Hampstead
Gospel
Oak Tufnell Park
Arsenal
Finsbury
Hill
Stoke
Queen’s Road Leyton
Midland Road
Ilford Upminster Bridge

zones South Ruislip Wembley Central

Kilburn
West Hampstead Kentish
Holloway Road
Park
Newington
Leytonstone Wanstead
Manor Park Hornchurch
Hampstead Heath Town Kentish Town St James Street
Sudbury Hill Stonebridge Park Rectory High Road Park Woodgrange Elm Park
West Park
Kensal Brondesbury Caledonian Road Clapton Forest
Reading Rise Park Road Leyton
Harlesden Finchley Road Belsize Park Highbury & Gate

2
& Frognal Camden Road Dalston Dagenham
Northolt Islington Kingsland Stratford
Twyford Sudbury Town Willesden Junction Brondesbury Chalk Farm Hackney International East
Maryland
Downs Hackney
Kensal Green Camden Town Caledonian Central Dagenham Heathway
Maidenhead Kilburn Road & Canonbury Stratford
Queen’s Park Finchley Road Barnsbury Becontree
High Road South Hampstead Mornington Homerton Hackney
Alperton

2
Crescent Dalston Junction Wick Upney
Taplow King’s Cross London Fields Stratford
Swiss Cottage St Pancras High Street
Haggerston Barking
Burnham Greenford Kilburn Park Cambridge Heath
Paddington Edgware Road Marylebone St John’s Wood Euston
East Ham
Maida Vale Hoxton Bethnal Green Pudding Abbey
Slough Warwick Angel Mill Lane Road
Perivale Avenue Upton
Bethnal Green Mile End
C Edgware
Great Portland Euston Old Street Bow Park C
Baker Street Street Square Warren Road
Langley Park Royal Road Street Plaistow
Royal Oak Farringdon Shoreditch
Hanger High Street Bromley- West

65 4 3 2 1
Lane Regent’s Park Stepney Green
Iver Westbourne Park Goodge by-Bow Ham
Acton Russell Bow
Main Line Street Square Barbican Church
Ladbroke Grove Bayswater Aldgate
Oxford East Whitechapel
Bond Street

2 2/3 3 4
Circus Moorgate Devons Road
West Latimer Road Liverpool Star Lane

1
Drayton Hayes & North Ealing Street
Harlington Marble Arch Tottenham Holborn Chancery Lane
Hanwell Langdon Park
East White Shepherd’s Notting Court Road
Acton City Bush Hill Gate Bank Aldgate
Southall West Covent Garden All Saints Canning
Lancaster Town
Ealing North Holland Queensway Gate St Paul’s Royal
Ealing West
Acton Acton Park Green Park Leicester Square Limehouse Poplar Victoria
Broadway Wood Lane Monument
Hyde Park Corner
Shepherd’s Piccadilly Cannon Street Custom House for ExCeL
Acton Central Circus Tower Shadwell Westferry Blackwall East
Bush Market High Street Kensington India
Kensington Hill Tower Emirates
Ealing Common Mansion House Fenchurch Street
Goldhawk Road (Olympia) Knightsbridge Charing Gateway Wapping Royal Prince Regent
South Acton West India Docks
Cross
D South Barons Gloucester Blackfriars River Thames
Quay
Royal Albert
D
Ealing Acton Town Hammersmith Court Road Canary
Westminster West Silvertown
Victoria Temple Rotherhithe Wharf
Beckton Park
Northfields
Chiswick Turnham Stamford Ravenscourt West Earl’s South Sloane St James’s Embankment London Canada North Emirates
Bermondsey Greenwich
Park Green Brook Park Kensington Court Kensington Square Park Bridge Water Heron Quays Greenwich Cyprus
Boston Manor Pontoon Dock
Peninsula
Osterley South Quay Gallions Reach
London
Waterloo City Airport

2 2
Hounslow East Gunnersbury West Brompton
Crossharbour Beckton Key to lines
Hounslow Central Pimlico King George V

1
Hounslow Southwark Surrey Quays Mudchute Bakerloo
West Kew Gardens Borough
Heathrow Fulham Broadway Island Gardens Central
Hatton Cross Lambeth North 00/0000/P
Terminals 2 & 3
Parsons Green Imperial Wharf
Putney Bridge Woolwich Arsenal Circle
Cutty Sark for
Richmond Maritime Greenwich
New Cross District

6 5 4 3
Queens Road
E E

3 4
East Putney Peckham Greenwich
Vauxhall New Cross Gate Hammersmith & City
Elephant & Castle
Heathrow Southfields Deptford Bridge

2
Terminal 5
Peckham Rye
Brockley Jubilee
Heathrow Wimbledon Park Kennington Elverson Road
Terminal 4 Clapham Wandsworth Honor Oak Park Metropolitan
Wimbledon Oval Lewisham
Junction Road
Stockwell Forest Hill
Clapham High Street Northern

3
Denmark Hill

Clapham North Sydenham

Piccadilly
Key to symbols Explanation of zones Clapham Common
Avenue

4
Dundonald Penge West Harrington Road Road
Interchange stations 9 Station in Zone 9 Road Clapham South
Brixton Beckenham
Junction
Victoria
Anerley Birkbeck Beckenham
Internal interchange 8 Station in Zone 8 Balham Road Waterloo & City

3
Station in Zone 7 Crystal Palace
Under a 10 minute walk between stations 7 Norwood Junction Elmers End

5
Step-free access from street to train
Station in both zones Tooting Bec DLR
6 Station in Zone 6
Arena
Merton Park Tooting Broadway
Step-free access from street to platform
Emirates Air Line
National Rail
5 Station in Zone 5
Station in Zone 4
Colliers Wood West Croydon Woodside
London Trams cable car
F 4 F
Airport
3
Station in both zones
South Wimbledon
Reeves Corner Centrale Wellesley
Road Lebanon
Blackhorse Lane
fare zone (special fares apply)
River services interchange Station in Zone 3 Addiscombe
Road London Overground
Victoria Coach Station 2 Station in Zone 2

Emirates Air Line cable car Station in both zones Morden

Road
Phipps
Bridge
Belgrave
Walk
Mitcham Mitcham
Junction
Beddington
Lane
Therapia
Lane
Ampere
Way
Waddon
Marsh
Wandle
Park
Church
Street
George
Street
East
Croydon
Sandilands TfL Rail
Outside fare zones, Oyster not valid 1 Station in Zone 1 Morden Lloyd Park

4
London Trams
Zonal tint values: Coombe Lane Addington King Henry’s New
Village Fieldway Drive Addington
Transport for London January 2020 Reg. user No. 00/0000/P Zones 10% Gravel Hill District open weekends and on
some public holidays

1 2 3 4 Zone 2/3
5 15% 6 7 8 9
Zone numbers 10%

MAYOR OF LONDON
Online maps are strictly for personal use only. To license the Tube map for commercial use please visit tfl.gov.uk/maplicensing
14

Collective insanity is much more dangerous than individual insanity since it compounds itself.
When you buy a product or service for yourself, your self-interest is generally well aligned with
solving the problem at hand. When you make a decision in an institutional setting, this is not true.
Fear of regret, which drives individual decisions, gives way to fear of blame: a decision which is
easy to defend, or one which delivers small but quantifiable incrementable improvements, will be
preferred to one which overall is better for the health of the organisation. Gerd Gigerenzer describes
this as “Defensive Decision-Making".

The difference between personal and institutional decision-making arises because, while the
consequences of an individual decision are usually experienced by the person making it, in
business, you are judged less by the consequences of a decision than by the quality of your
reasoning in arriving at it.

Indeed, many cited instances of consumer bias are not really biases at all. They may simply be
explained by the fact that a consumer’s deep-seated, instinctive and unconscious motivations are
more sophisticated and multivariate than economists and narrow rationalists can understand.

For instance, a car may be bought as a form of transportation, but it may also be bought to enhance
the status and reproductive prospects of its owner. If we were exclusively interested in the former,
a Lamborghini would seem an appallingly “irrational” way of travelling through London (it is slower
than the train on most journeys). On the other hand, for someone interested in enhancing their
status, it is rather better than an unlimited train pass.

But when you make a decision in an institutional setting, “How will I be judged on this decision?”
weighs more highly on the mind than “What is the likely outcome?” It is at its worst when the
interests of an individual decision-maker are not well aligned or synchronised with the interests of
the business or institution.

The good news is that, if business decision-making is plagued with consistent distortions in
thinking, it provides a huge opportunity for discovering new ways to compete: the greatest market
opportunities exist where every significant actor in a market segment shares the same set of self-
limiting assumptions. If you can find out what they all assume to be true, which now isn’t, you have
already found a basis from which you can differentiate yourself and win.

And this opportunity may be open to more people than realise it.

6
Professor Gigerenzer is a renowned psychologist at the Max Planck Institute, Berlin. See Risk Savvy for a popular explanation of his work
on Defensive Decision-Making.
 15

T H E OBJECT IVIT Y T R A P
"B2B IS BIGGER THAN ANYONE THINKS."
Remember, just because you communicate with consumers from time to time, this does not mean
you are not a B2B business.

Think about it. In reality, Google is a B2B business (almost all of its revenues derive from other
businesses). Amazon’s Marketplace and Cloud are B2B businesses. British Airways and Eurostar
survive largely on B2B business. Even Unilever and P&G are both B2B businesses in many respects
- both spend more on trade marketing and sales than on consumer marketing. Visa and Mastercard
may be consumer brands, but they are largely B2B businesses. A huge part of government is
engaged mostly in interacting with businesses, not individuals. And, as the ad guru Stephen King
of JWT observed, most B2C advertising works in part through its indirect appeal to a B2B audience,
since retailers and other intermediaries are more likely to stock a product and pay the desired price
for it, which has been heavily promoted to their own customers.

Almost all businesses are B2B businesses to some extent, even if they don’t know it. Yet mixed
businesses tend to concentrate most of their marketing attention on consumers.

Within the businesses mentioned above, far more attention will be focussed on consumer marketing
than on B2B marketing.

Yet B2B is big. Very big.

Almost all businesses are B2B

businesses to some extent, even if they
don’t know it. Yet mixed businesses
tend to concentrate most of their
marketing attention on consumers.

7
B2B Marketing Magazine. (2019). B2B Nation: The B2B Industry’s Contribution to the UK Economy Revealed
8
Bureau, US Census. "2015 SUSB Annual Data Tables by Establishment Industry". www.census.gov.
9
WPP BrandZ B2B Survey 2018
16

THE SCALE OF THE OPPORTUNITY.

Nearly 40% of UK companies derive all or the majority of their income from Business-to-Business
activity and a further 42% are hybrids, with some of their income from both B2B and B2C. While
it is impossible for us to know the exact size or value of B2B internationally, we do know that B2B
accounts for 44%, or £1.7 trillion, of the UK’s business turnover and some £21.78 billion in corporate
tax. Over 50% of UK FTSE 350 firms are pure B2B businesses and, unlike B2C, we in Great Britain
have a global trade surplus on our B2B activity.

In the US, B2B companies represent an even more significant part of the national economy. This is
especially true in firms of 500 employees and above, of which it was recently estimated that as many
as 72% are businesses that primarily serve other businesses. In 2018, in the US, B2B sales totalled
over nine trillion dollars .

According to the BrandZ Top 100 Most Valuable Brands study, total B2B brand value globally
increased by 21% to reach 4.4 trillion. (BrandZ defines a B2B brand as one that generates more than
half its revenue from business clients.)

A large B2B sector is in many ways the hallmark of a developed economy.

If B2B accounts for around 50% of the economy, why does B2B Marketing receive so much less
attention than consumer marketing does?

One possibility is simply that it does not work as well as marketing to consumers.

A second possibility is that, for some reason or other, people mistakenly believe that it does not
work as well as marketing to consumers. Or that the people working in B2B have less respect for
marketing.

If B2B accounts for around 50% of the

economy, why does B2B Marketing
receive so much less attention than
consumer marketing does?

6
B2B Marketing Magazine. (2019). B2B Nation: The B2B Industry’s Contribution to the UK Economy Revealed
7
Bureau, US Census. "2015 SUSB Annual Data Tables by Establishment Industry". www.census.gov.
8
WPP BrandZ B2B Survey 2018
 17

T H E OBJECT IVIT Y T R A P
This second possibility warrants some investigation. Because if business-to-business firms are
making too little use of marketing, it may represent a considerable opportunity cost: billions of
pounds of unrealised economic value may be waiting to be discovered if marketing were used more
often, creatively, and wisely.

Here’s Peter Thiel in his book Zero to One: “If you've invented something new but you haven't
invented an effective way to sell it, you have a bad business—no matter how good the product."

A business decision-maker is a very valuable target audience indeed. Ordinary consumers rarely
buy anything costing £500,000. Some businesspeople may make purchases of this size routinely.
Consumers generally buy products sporadically and in small volumes, and your brand forms a
small part of their overall budget. In fact, for a food company, a cat or dog may be a more valuable
customer than a human, since it is possible to get 100% share of stomach from a pet. Although
humans spend more on food than cats do, they spread their budgets very widely: it is difficult, even
for a Nestlé or a McDonald’s, to get more than 5% share of stomach from a human.

But if that human is making a decision for a business, this no longer applies.

Hence the payoff for a single act of persuasion in B2B may be many times more lucrative than in B2C
and more enduring. Moreover, targeting those decision-makers, which might have been inefficient
or costly in analogue media, becomes many times more efficient in digital and social media, where
it is possible to reach people in specific companies by their specific function and area of purchasing
authority. The gain in efficiency in targeting is far higher for B2B (through LinkedIn, say) than the
relative gains in conventional social media.

But surely, companies are purely rational, profit-seeking entities? If business-to-business marketing
were really to work well, companies would do more of it, wouldn’t they?

No. Or not necessarily.

Remember again that phrase “No one ever got fired for buying IBM.”

In the same vein, “No one ever got fired for cutting a cost which produced an imprecise or
unquantifiable benefit."

If people have fallen into the B2B objectivity trap, they will have missed opportunities to put
behavioural thinking to work.

Hence the value of good psychological insight in B2B businesses is potentially even more valuable
than in a traditional marketing-heavy consumer business. And the value of the marketing mindset
will be most valuable in fields where it has yet to be deployed.
 19

T H E OBJECT IVIT Y T R A P
Business needs
more than one map
20

As I recommend to London house-hunters: “First get a copy of the London Underground Map then
ask yourself ‘What isn’t on it?’” The places depicted on the map are places that everyone already
knows. Common knowledge isn’t very valuable. It’s by discovering something that isn’t on the map
that you can gain a comparative advantage. A house beside a railway station will cost far less than a
house beside an Underground Station for this reason.

The contention of this paper is that, for a whole variety of cultural and behavioural reasons, biases
are often more powerful in institutional and corporate decision making than in consumer decision-
making. Yet by preferring the false-certainties that arise when you pretend your business customer is
a rational economic agent possessed of stable preferences and perfect information (the “convenient
fiction” of the title), businesses are leaving many millions of pounds of potential economic value
on the table through an emotional aversion to the use of marketing, psychology and behavioural
science.

This besets all organisations, but for a variety of reasons, it is most pronounced in the business-to-
business arena.

Just for convenience, below is an incomplete list of some of the assumptions which unconsciously
bias businesses towards devaluing B2B marketing.

Business decision-making is a ‘rational’ cost-benefit analysis

I People assume that marketing only exists to exploit irrationality; since business decision-
making is believed to be largely rational and conscious, marketing influence over B2B
procurement decisions is considered minimal when compared to its influence over
consumer purchases.

From an economist’s world view, marketing is a cost rather than a

II value-ad
MBA-level Economics assumes that the growth of markets is limited by supply, and that
demand is a given. Hence marketing is not perceived as a significant driver of overall
growth or productivity.

Further, (Non-Austrian) economists assume a world of perfect information and stable

preferences – a model of the world in which advertising is unnecessary: it is hence
perceived as a cost or an inefficiency, not a source of value creation.

Marketing is decorative
III Rather like the ancient Chinese, who invented gunpowder but used it only for fireworks,
marketing is viewed as a form of decoration, not as a truly disruptive technology.
Consequently, there is little status to be enjoyed by winning through superior marketing,
rather than, say, winning on product or price.
 21

T H E OBJECT IVIT Y T R A P
Marketing spend is equivalent to marketing’s importance
IV People assume that because bought media is the most expensive item of marketing
activity, it must therefore be the most important. People consequently assume that, if
their business spends comparatively little on bought media, marketing is therefore of
low importance to their business.

Short term financial metrics are the key to success

V In businesses with low levels of marketing spend in proportion to overall turnover,
which includes most B2B organisations, marketers enjoy little to no influence - and the
sales function tends to dominate. Once you lack influence, you are forced to fall back
on short-term financial metrics to justify your existence. And short-term interventions
are exactly that. They work, but only in the short-term.

Even when you think you’re selling a product, you are selling
VI a service
There is much to be said for the arguments of Service Dominant Logic as promoted by
Vargo & Lusch (2004). In B2B their approach is perhaps even more valuable than in
B2C. By challenging the Goods Dominant mindset which holds that value is inherent
in the product – a viewpoint which tends to lead B2B businesses further away from
considering a customer perspective – and by considering the customer as a cocreator
of solutions (someone you market “with” rather than “to”). This is a mental approach
which is much more likely to make the role of marketing within large B2B companies
more central to their thinking, rather than banishing it to the periphery (and to the
jurisdiction of the sales department). A goods dominant mindset tends to promote
commoditisation; a service dominant mindset forces you to differentiate yourself.

And ad agencies aren’t much help

VII Ad agencies have not been paid on media commission since the late 1980s: but the
muscle memory causes them to consort only with people with large communications
budgets. This means that they rarely bother talking to people in B2B. People in B2B
therefore spend far more time time speaking only to management consultants, many
of whom share the prevalent assumptions above.
 23

T H E OBJECT IVIT Y T R A P
Marketing is not
marcoms; it’s a
mindset.
24

We tend to conflate “marketing” with “consumer marketing”. Moreover, we (agencies especially) are
liable to conflate “marketing” with “marketing communications” or (worse) “marcoms”. As this article
explains, this may be an expensive mistake.

As a result, organisations which do not spend large amounts of money on marketing (typically those
which spend very little on bought media) will typically have a marketing function which is small,
and may be possessed of minimal influence. This is a problem which is particularly prevalent both
in B2B and in start-ups, where the amount spent on media is tiny in proportion to the size of the
organisation. But the importance of marketing to an organisation does not diminish simply because
you spend little money on it.

This is because marketing (as distinct from advertising, pricing, PR, etc) is not a specific activity: it is
a mindset. More specifically, it is a mindset which is essential to understanding and solving certain
issues and problems in business which have their origins not in engineering, efficiency, logistics, or
in the world of physics but in the more complex realm of human perception, cognition and in the
fields of individual and social behaviour. For this reason, the outcomes of marketing efforts are often
larger than the sum of their parts.

Marketing should not even be confined to the marketing department. Entrepreneurs are
disproportionately focussed on marketing (Bezos, Jobs, Branson), and are inextricably associated
with the brands they create. The best CEOs (Bob Crandall, Bob Lutz) are disproportionately
responsible for driving marketing innovation, often overriding the objections of their finance
departments in the process. When Jeff Bezos introduced Amazon Prime, one of the most interesting
ideas of the last few decades, almost everyone else in the company thought he was mad. Yet people
who join Amazon Prime spend perhaps five times more with Amazon as a result.

All of this means that good marketing is sometimes, by necessity, messy. It is probabilistic rather
than deterministic. This is frustrating to the tidy-minded. But it does not change the fact that often
a marketer might be right and an economist wrong. Being able to spot those occasions where
conventional logic needs to be suspended is vital to good decision-making.

Will more people buy a product at £200 than at £300? To an Economist or Finance Director, this is a
clear-cut question with a self-evident answer; to a Marketer’s mind it is not – a low price may signal
a lack of seller confidence. Moreover, if your product is visibly better than a £220 product from a
competitor, selling it for £200 may create confusion and mistrust in the buyer’s mind.

10
See: Dave Trott’s 1+1 = 3
 25

T H E OBJECT IVIT Y T R A P
Should you make an industrial cleaner quieter? To an engineer, obviously the answer is yes. Better
still, it’s an appealing, status-enhancing challenge. A marketer would be unsure – it is possible that a
user will perceive a quieter piece of machinery as being less powerful.

This messiness, along with the shape-shifting use of vague terminology such as “brand” and
“purpose” is almost painfully frustrating to non-marketers, which is why marketers and their budgets
are often viewed askance by people in the hard-science cultures of engineering or finance. In B2B,
where an even stronger belief in buyer rationality persists, the distaste for marketing is often even
greater.

I would argue that, counterintuitively perhaps, it is this very messiness which makes marketing one
of the first places any B2B company should look to find enduring growth and competitive advantage,
particularly in a crisis. It also creates opportunity – both in ways which can be planned and ways
which can’t. Quite simply, the complex nature of human psychology makes it one of few remaining
places where untapped and unexpected monopoly advantage still lies waiting to be discovered. A
technological advantage can be copied in months but a psychological monopoly may endure for
years. The distaste for marketing found among your competitors may even make them culturally
averse to copying your success.

Who other than James Dyson thought anyone would pay more than £500 for a vacuum cleaner?
Certainly not I. I like to think of myself as open to ideas, but I would have countered first that a
vacuum cleaner is not a luxury good but a distress purchase, bought only grudgingly when your
existing model breaks down, and secondly that anyone who can spend £500 on a vacuum cleaner
probably employs a cleaner, so isn’t all that bothered about baglessness anyway. I would have been
perfectly logical in saying this – but it seems I would also have been perfectly wrong.

(I still don’t fully understand the Dyson psychology myself. My father, who would be aghast at the bill
if you took him to Pizza Hut, owns three of them.)

It all goes to show that sometimes it pays not to be logical. For if you succeed at doing something
which logical people wouldn’t do, you occupy a market space all to yourself.

The problem with logic is that it gets you to the same place as all your competitors.

But in a B2B setting, any departure from conventional logic is culturally very difficult.

If you only believe in logic, you can’t perform magic.

 27

T H E OBJECT IVIT Y T R A P
If you only believe
in logic, you can’t
perform magic.
28

At the time the iPhone was released, many mobile phone manufacturers were fixated on logical
incremental improvements. Faster processor clock-speed; more memory; smaller size; greater
battery life. All perfectly sensible, except that each was designing phones that were more and more
like everyone else’s.

The iPhone was not really category-leading in any of these measures (indeed its battery-life was
initially dismal, and counter to the prevailing trend, it was a very big phone). Apple’s advantage lay in
rewriting the rules: by asking a different, messier question: not “what can this mobile phone handset
do,” but, “how does it feel while you are doing it.” Their edge was psychological, not technological. In
defining its own criteria for excellence, the iPhone carved out its own category.

Once people saw the iPhone, all the metrics and product attributes which consumers had professed
to care about one week earlier suddenly went out of the window. Have you heard anyone in the last
ten years boasting about how small their phone is? I doubt it. In fact, now you can pay extra to get
an even larger iPhone. (Apple, incidentally, had spotted another problem with endless pursuit of
the same rational metrics – that businesses often pursue them beyond the point where they remain
humanly important. Once a phone fits comfortably in a pocket, there is very little to be gained
from reducing its size further. Male engineers may also have failed to notice that half the human
population does not much use pockets – they carry bags.)

“Nerds hate marketing and advertising because

it seems kind of superficial. But you have to pay
attention to marketing because marketing works.
It works on nerds and it works on you.”

Though celebrated in retrospect, this psychological approach to innovation did not always endear
Steve Jobs to engineers within Apple: “What does Steve do exactly? He can’t even code.”

Here’s Peter Thiel again, “Nerds hate marketing and advertising because it seems kind of
superficial. But you have to pay attention to marketing because marketing works. It works on nerds
and it works on you.”

As experiments in behavioural science have repeatedly shown, value can be created in the mind just
as much as it can be created in the physical world.

The suspicion and doubt expressed towards psychologically-led, creative marketing transformations
is more prevalent in businesses which have a strong financial, engineering or technocratic mindset
– and even more in B2B. Most people in business like to believe that value is created in the factory

10
See: Dave Trott’s 1+1 = 3
 29

T H E OBJECT IVIT Y T R A P
– or in the physical world of objective, measurable improvements which can be easily defined and
easily managed. Theirs is a Newtonian view of the world where there is no room for magic. In this
neat, psychology-free world, the only way to improve a product is to change it or make it cheaper.
For this reason, people in such cultures are prone to seeing marketing as a cost to be minimised,
not as a source of potential value creation. In the economist’s perfectly efficient imaginary world of
perfect information and stable buyer preferences, marketing would be unnecessary. So people of
a deterministic mindset tend to see marketing as an inefficiency or a cost, not as an opportunity to
create added value.

The problem is that, once you only believe in logic, you can’t perform magic anymore. This means
you spend none of your time looking for magic, and you look to discount it or deny it when it
appears. You become overly suspicious of the value of human insight or the revolutionary effects
made possible by a deeper understanding of what customers really care about. (I spent the day
of the iPhone’s release with a bunch of Nokia executives, who were amused at Apple’s temerity in
launching a phone with 20-hour battery life - so convinced were they that they already understood
what customers wanted in objective terms, they were sure it would fail).

In highly rationalistic cultures, whenever value is created in the mind instead of the factory, it is often
seen as ridiculous at first. If it ultimately succeeds, it is seen as cheating.

In the B2B world, this Newtonian mindset is further strengthened by the belief that you are selling to
completely rational, profit-maximising organisations entirely immune to emotion. If you are selling
Lucky Charms, you probably do have to accept that there are emotional dispositions at work. If
you are selling industrial drill bits, however, it’s all too easy to believe that your product’s rational,
quantifiable attributes are all that matters, since your customer is an unbiased, wholly rational
corporation, where any biases will be hammered out though the collective use of pure reason.

Everything in psychology suggests this is wrong: in fact biases, especially correlated biases, are as
likely to be caused by collective decision-making as to be reduced by it (see below).

Yet unless you have a powerful marketing presence somewhere in your organisation, the natural
tendency of most people in business is to pursue incremental, objective improvements rather than
pursuing less-certain but potentially game-changing improvements in perception.

This is particularly prevalent in B2B organisations, since, while it is accepted that there is a certain
amount of “irrationality” in consumer decisions, it is widely believed that decisions taken in a
business or government context must of necessity be taken only on the basis of completely rational,
objective judgement.

Underlying all this may be a rather sexist assumption: that chocolate bars are bought by women for
all kinds of impulsive reasons, while B2B purchasing decisions are taken by men in suits as a product
of a long process of highly rational deliberation. How rational are men in suits in any case? And who’s
to say that purchasing decisions are made by men in the first place? People are, (understandably)
more than a little emotional about their long-term career prospects and keeping the respect of their
colleagues.
30

IF BUSINESSMEN ARE SO RATIONAL, WHY DO THEY ALL PLAY

GOLF?
Yet, as I said above, this is a convenient fiction. In institutional decision-making, behavioural biases
are probably more pronounced than in consumer decision-making. Solomon Asch’s experiments
showed that people would conform to a group consensus and adopt beliefs that they would never
hold if they made the decision alone, simply to conform to peer pressure. (An extreme version of this
is called the Abilene Paradox, where a group of people can agree on a course of action even when
no individual within the group supports it, simply on the misguided belief that it is what other people
want to do.)

Abilene Paradox
The Abilene Paradox

“We’re relocating to Abilene”

“What!?” “Where!!” “Why!!”

Best decision ever!

 31

T H E OBJECT IVIT Y T R A P
There’s a classic experiment where you ask people to estimate how many coins there are in a
transparent jar. When people do this independently, the accuracy of the judgment rises with the
number of estimates, when they are averaged. But if people hear each other make estimates, the first
one influences the second, which influences the third, and so on. That’s what the Nobel-winning
psychologist Daniel Kahneman calls a correlated error.

Correlated error box

“more like 2000..

no... actually 22”

“The Board strongly believes

there are 20 coins in the jar!”

“defo 20ish”

“I would say
in the 20s?”

Correlated error

One bias which may infect everyone within a company is the urge to prove their worth on a regular
basis. In a highly defensive organisation, your job security may be far better assured by a series of
small, continuous, incremental gains, than by investing a year in something really significant. If that
large project gets canned, you may well end up going with it.
 33

T H E OBJECT IVIT Y T R A P
No one ever got
fired for thinking
like a computer.
34

Two other behavioural biases prevalent in collective decision-making were spotted by the economist
John Maynard Keynes in the 1930s. “Worldly wisdom teaches that it is often better for the reputation
to fail conventionally than to succeed unconventionally”, he observed. He also spotted in a certain
kind of institutional decision-making a preference for being “precisely wrong rather than vaguely
right.” The reason we may prefer to be precisely wrong than vaguely right, and the reason we
may prefer to make highly conventional decisions makes sense when you realise that if you make
conventional decisions, or make decisions using a highly precise mathematical model rather than
using instinctive judgement, these decisions may not turn out well, but you are much less likely
to get blamed if things go badly wrong. If you are the lone person making a subjective, eccentric
decision, you are the focus of all blame if things turn out badly.

This partly explains why meetings are so popular in workplaces. A decision made by ten people is a
way of ensuring that blame is widely dissipated in the event that things turn bad. It is much better for
one’s career to be one of ten ‘scapekids’ than to be the lone scapegoat.

Which brings us to the work of Gerd Gigerenzer. Gigerenzer has identified a pattern of behaviour
which he calls “Defensive Decision-Making". In defensive decision-making, someone (a doctor, a
consultant, a chief executive) makes a decision under the strong influence of an unconscious bias.
Although they think they are making an optimal decision given the available information, in fact
they are heavily influenced by a second consideration: not “what is the best decision I could make
for my patient/company?” but “what is the decision I could make which has the least worst-case
consequences for me personally?”
 35
Principal-Agent problem

T H E OBJECT IVIT Y T R A P
A.GENT

Principal Agent Problem

Defensive decision-making is most common in professional or institutional settings.

In medicine, this leads doctors to be far too prone to recommending medical interventions. Why?
Because it is much more likely that you are sued for inaction than for action. Moreover, if you
recommend surgery and something goes wrong, it would be the surgeon who gets sued, not you.

Risk of failure against clinging onto certainty

“Better to fail logically through Fortune favours

measurement and science the messy
than succeed through instinct and alchemy”

DEFENSIVE
DECISIONS

1
Clinging onto certainty
36

In business, it leads to, well, “No one ever got fired for buying IBM.”

When presenting to the board of a huge multinational corporation, the Nobel-winning psychologist
Daniel Kahneman posed a question to each of the directors individually: “If I offered you the chance
to make a decision in your division which had a 75% chance of increasing your profits by 30% and a
25% chance of reducing your profits by 30%, would you make that call?” All but two replied no. Why?
Because it meant a one in four chance of getting fired.

The Chief Executive looked crestfallen. “But I’d want all of you to make that decision. Because, in
aggregate, we’d make 15% more money.” He was in a position to enjoy the aggregate gains without
suffering the shame of individual losses. His directors had to bear the risk of individual losses,
without enjoying the gains of their colleagues.

In short, when consumers make a decision (marrying, buying a house, choosing a TV) they are
unconsciously trying to minimise the risk of regret. When businesspeople or bureaucrats make a
decision, they are trying to minimise the risk of blame.

It is for this reason that business decision-making may be far more plagued by irrational fears than
consumer decision-making. The consequences of making a decision that turns out well are generally
shared widely with a group and might gain you a bonus if you are lucky. The consequences of
making a decision for which you can be blamed are potentially career destroying. The personal
outcomes are not well aligned with the collective outcomes. (Partnerships may do this better than
publicly owned companies).

“No one ever got fired for

buying IBM.”
 37

T H E OBJECT IVIT Y T R A P
And, as Keynes spotted, one of the biases that might be produced by this asymmetry is a kind of
hyper-rationalism. You make decisions not on the basis of what you believe is best, but on the basis of
what is easiest to defend. If the decision can be shown to have been based on a reductionist model
or algorithm, however pseudoscientific this might be, you are more likely to escape censure. Even if
we don’t see it in ourselves, blame avoidance is a deep-set, instinctive corporate behaviour.

As a result, much activity within workplaces is almost certainly arse-covering disguised as rigour
- where people are using statistics, as David Ogilvy once said, “As a drunk uses a lamppost: for
support rather than illumination.”

I once asked Gerd Gigerenzer what corporate life would be like if we did not practice defensive
decision-making. He replied “We could finish the week at lunchtime on Wednesdays.”

But the fact that businesses do not make decisions in the way that economists think they do is good
news for people who believe in magic – since it suggests that a kind of psychological magic might
be deployed in B2B dealings every bit as much as when selling to consumers. Innovations in price-
sharing, in risk-sharing or the ability to make a small commitment before making a larger one might
do much to reduce fear in the B2B buyer. New forms of measurement might be offered to prove the
value of the buyer’s job to others in the organisation.

Contrary to what is believed about business decision-making, the humans who make business
decisions are no more immune to deep psychological motives than anyone else. Fear of blame, after
all, may be as old as humanity itself.

It also explains why brands are much more valuable to B2B marketers than they themselves realise.
A decision to appoint a respected brand is much less reputationally risky than the appointment of an
unknown. If you appoint a well-known company to a task and things go wrong, your colleagues are
likely to blame the supplier. If you appoint someone obscure, they may blame you.

As with medicine, there is a pharmacological effect and a placebo effect. One tends to be respected
while the other is discounted on the grounds that it is seemingly ‘magical’. Yet both can work in
tandem. The best treatment would maximise the placebo effect alongside the pharmacological
effect – the alchemy alongside the chemistry.
 39

T H E OBJECT IVIT Y T R A P
The loneliness
of the long-term
marketer
40

In many organisations, this hyper-rational business culture is not one which is welcoming to
marketing thinking. The role of the marketer may hence become lonely, unenviable and short-lived.
It is also becoming more and more narrowly circumscribed, with a very short average tenure. None
of this bodes well for the long-term creation of marketing value: and the most sustainable forms of
value in marketing are mostly created over the longer term.

Yet the requirement to make counter-intuitive judgements based on no firm data is career
-threateningly dangerous in a highly rationalistic business environment.

But with the right mentality, a single marketer, by virtue of his different mindset, could provide
spectacular value in unexpected places. Value which no one else would think to create. The
opportunity to do this is greatly heightened by the development of behavioural science as a
discipline. The great advantage of behavioural science is that it describes marketing practice in
terms people of a rational mindset can respect. One acquaintance of mine, who runs a behavioural
science practice in Silicon Valley, describes her role as follows: “the Marketing Director hires me to
explain what she does to the engineers.”

How might this work?

Well, for example, conventional economic logic suggests that for any given product or service, the
only way to increase your sales to rational business buyers is to improve the attributes of the product
or to reduce the price they pay. As a result of this reductionist thinking, no thought is given to a
magical solution – which is to charge for the product in a way which makes people instinctively
willing to pay more. A marketer would think to do this. A marketer knowledgeable in behavioural
science would know how to defend his instincts, and could cite scientific papers in support of his
assertion.

One B2B marketer for a law firm ingeniously charges a monthly retainer for legal services to
transport and haulage firms. But he frames the price very differently. Not “£1000 a month for a fleet
of 80-100 vehicles” but “from 33p per vehicle per day”. To an economist, this would seem a trifling
distinction. But he repeatedly finds it makes selling the product inordinately easier. Framed against
the £250,000+ value of a large truck, 33p seems a trifling amount, whereas £1,000 a month sounds
like a rather painful cost. Here, and in the case below, the use of the phrases “anchoring” and
“framing” could be decisive.

In the same way, in the early stages of a food delivery brand (now worth over £1bn), the proposal
was to pay the restaurant directly for each meal it supplied and then to invoice them monthly for the
commission on the month’s past sales. A marketing thinker pointed out that this was a mistake. “We
should keep the money from each meal sold, deduct commission, and then send them a payment
every month.” He or she understood that, if the restaurant saw the new business as a source of
incremental revenue, they would value it; if they saw it primarily as a cost, they would look for ways to
avoid it. Again, in economic terms, there is no difference between the first proposal and the second,
but the psychological effect on the business will be dramatically different.
 41

T H E OBJECT IVIT Y T R A P
Price Framing

“we make them psychologically more desirable...

and increase price ”

“we manufacturer them faster

and decrease price!”

Price reframing

I have repeatedly asked utilities why they drop the price of their energy to businesses, rather than
keeping the price the same and paying a rebate at the end of the year. “What’s the difference?”
they all ask me. Because when a finance director receives a rebate, he or she can move it into any
budget they like. They’d much prefer that. I don’t know a great deal about finance, but I do know that
the freedom to move money about gives accountants great joy. It’s pretty much what they live for.
Again, no non-marketer would think of doing this, since in their reductionist model, money is money.
Actually, money is psychology. The value of money rests on a mutually shared delusion.
And a finance director values moveable money far more highly than a discount.
 43

T H E OBJECT IVIT Y T R A P
If you want growth,
avoid reductionism
44

If there were more behaviourally-informed marketers in a host of organisations which currently has
no access to this thinking, it might end such companies’ mistrustful attitude to psychological value –
and as a result release a great deal of extra value.

This doesn’t only apply to B2B; it is also commonplace in almost all organisations with a strong
technical, financial or engineering culture. People who run railway companies obsess about
punctuality and speed. What they need to be told is that, if you keep customers informed of delays
throughout the journey, and explain the reasons, people are much less annoyed. It also means they
can break the bad news to their clients gently in advance, rather than arriving at a meeting late and
in a flustered condition.

In most internal functions of business (HR is an obvious exception), objectives can be defined in very
simple, objective terms. Speed, time, weight, cost. Success can be defined in advance, and progress
can be measured against these aims. When put into practice with human beings, the rules will never
be so neat. Good organisations need to learn to lose their aversion to ambiguity.

In marketing, the metrics that matter are defined by the customer, not by the organisation.

These metrics may change over time. And vary enormously between different customers and
different marketing strategies.

In a business culture which is obsessed with quantification and measurement, there is an ever-
present risk that the need for accountability makes the value created by marketing smaller rather
than larger. If you spend your money doing only what can be proven to work, you may be missing
out on things which are more effective but less demonstrable. You will also focus disproportionately
on short-term wins over long-term value creation.

This is inclined to happen in any organisation with an expensive sales function, since sales will tend
to dominate marketing. Sales will principally judge marketing as a source of leads, especially in the
short term. This is by no means an unimportant function of marketing, but it is a narrow activity, not
a state of mind. By narrowing the remit of marketers down to a single purpose or metric, you will end
up trying to optimise the wrong thing.

Or, equally, by demanding that marketing expenditure is wholly accountable, and maximally
efficient, you may confine your communications to low impact, highly-targeted media which fail
to deliver any of the wider benefits of fame, and which fail to reach influencers (IEUs) and other
colleagues who may still be involved in ratifying the final decision.

As I mentioned at the start of this article, marketing is probabilistic, not deterministic. You cannot
define its effects fully in advance, nor measure them fully in retrospect. It is valuable for a business
to be famous in all kinds of ways – because fame vastly increases a business’s scope of possible
opportunity. At a simple level people cannot buy from you if they do not know you exist. But they
cannot buy confidently from you if they have never heard of you before. As fame increases, other
possibilities will present themselves that you could not possibly have predicted. Suddenly people
return your CEO’s phone calls. You attract investment. Your stock value rises. Other businesses
approach you, suggesting partnerships. People bring you new ideas. Better candidates demand
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T H E OBJECT IVIT Y T R A P
less money to work for you to enhance their resumés (and LinkedIn profiles). They work for you for
longer. You win more bids. Your employees feel 20% cooler at parties. In none of these cases can the
ends be predetermined or the full value quantified. Does that mean you should make no attempt to
be more widely known? I don’t think so.

What is interesting here is that individuals, when it comes to their own brands, understand the
probabilistic nature of opportunities instinctively. They spend hours polishing their LinkedIn profiles
with no specific audience in mind and attend as many networking events and industry functions as
they can – without performing a cost-benefit analysis in advance. Yet when businesses perform these
functions, they proceed on the convenient fiction that everything is knowable, and success must
always be the kind you plan for in advance.

But wider fame often works better than narrow focus.

Take a big idea from B2B: American Express’s “Small Business Saturdays.”
46

This is an idea whose principal focus is to build relationships with many small retailers and
restaurants. But to measure it exclusively by its success in acquiring and maintaining the footprint
of smaller stores which accept the card would be to undervalue it. It has resonance far beyond the
intended audience, and may contribute as much value in driving Cardmember loyalty as it does in
creating Card acceptance from merchants.

This provides a glimpse of what B2B marketing could do if it were to consider a broader remit for
marketing ideas.

A simple first step to putting this right.

A marketer at board level, armed with the right amount of behavioural science could challenge
these assumptions,and could point-out the risks of decision-making biases in all manner of internal
decisions.

But above all, the injection of a marketing mentality into a senior position in a B2B company could
help that company innovate and grow, by suggesting new psychological forms of differentiation,
and by pointing out that not everything that is costly is necessarily a cost. This would challenge the
mindset typically deployed in board meetings – where, as Professor Jules Goddard explains, “a
balance sheet containing seven cost lines and one revenue line leads to costs and earnings being
discussed in that same ratio.”

What might be an important first step to obtaining this? For one, in all organisations, especially in
B2B, at least one non-Executive Director should be sought from a marketing, media or psychology
background. This will help the cognitive diversity of decision-making.

We also need to use behavioural science to update the language of marketing in terms which
are more board friendly, and more science friendly. The language and vocabulary of Behavioural
Economics, sharing much terminology with the language of Finance, can only help here. The recent
publication of the B2B Institute’s whitepaper ‘Marketing to the CFO’ is a useful addition to any
marketer’s reading list.

Our long-standing pretence that psychological effects shouldn’t count does wonders for making us
look rational and scientific. But it costs us very dear - in money and in health.
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In Summary...
1 There’s another map
It’s a convenient fiction that business decision-making is aligned with conventional
economic axions. Behavioural science offers a valuable counterpoint to this
logical or quantifiable view of business, providing marketers with an entirely new
experimental space in which to play. Remember, if you can understand what others
assume to be true but actually isn’t, you’ve already found a means to differentiate
yourself.

2
Marketing is a ‘mindset’
It’s a convenient fiction that it’s always better to win on product and price. The
reality is that there’s power in the psychological monopoly unlocked by embracing
a marketing mindset. There are potentially billions of pounds of unrealised
economic value waiting to be discovered if marketing were used more often,
creatively and wisely. Remember, while a technological advantage can be
copied in months, the injection of a marketing mentality (particularly outside the
marketing departments) can help companies to innovate and grow by suggesting
new psychological forms of differentiation.

3
We don’t rationalise or calculate, we avoid blame
It’s a convenient fiction that procurement decisions are made rationally and
logically for the benefit of the business. In reality, they are heavily influenced by a
second consideration, “what decision has the least worst-case consequences for
me personally?” Blame avoidance is a deep-set, instinctive corporate behaviour.
To lessen its sting, we should continue to explore innovative approaches to price
and risk-sharing. By helping to make a smaller commitment before a larger one, we
can do much to reduce fear in the B2B buyer.

The report identifies five key principles

4 Playing the long game is key, particularly in B2B
It’s a convenient fiction that the importance of marketing is proportional to the media
budget. Yet, unless you have a powerful marketing presence somewhere in your
organisation, the natural tendency of most is to pursue short-term sales, and incremental,
objective improvements. The reality is that short-term interventions work, but only in the
short-term. With the right mentality, greatly heightened by the development of behavioural
science, a single marketer can provide spectacular value in unexpected places.

5
If you want growth, avoid reductionism
It’s a convenient fiction that everything is knowable and quantifiable through objective
terms like speed, time, weight and cost. It’s fiction too that success must always be the kind
you plan for in advance. Perhaps counterintuitively, it is the very messiness of marketing
which makes it one of the first places any B2B company should look to for enduring growth.
You cannot define its effects fully in advance, nor measure them fully in retrospect. It is
probabilistic, not deterministic. Because of this, brand fame vastly increases a business’s
success by presenting opportunities that would otherwise have been impossible to predict.
By narrowing the remit of marketers to a single metric, you will end up trying to optimise the
wrong thing.
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Behavioural Science Principles Profiled

Defensive Through the lens of defensive decision making, an employee might believe
‘Option A’ is best for their company, but instead settle for a safer option – not
Decision one that advances the company’s interests, but minimises the risk of blame
Making for themselves as an individual. This line of reasoning often takes place
subconsciously.

Implication
To leverage defensive decision making for your benefit, keep in mind
your target customer’s professional ambitions in positioning a partnership
opportunity.

Gigerenzer, G. (2014). Risk savvy: How to make good decisions.

When individuals make evaluations under uncertain conditions, hearing the

Correlated perspectives of others will skew the accuracy of their judgement. Similar to
Error the outcomes of the childhood game “telephone”, where the first opinion
given influences those of the listener, which then influences the next person
involved in discussion. Conversely, when multiple people are asked to make
a judgement independently, the accuracy of those estimates rises when
averaged.

Implication
Create space for team members to develop their opinions independently
to preserve the value of individual contributors. If everyone copies their
neighbour’s guess in procurement decisions, outcomes will suffer.

Surowiecki, J. (2005). The Wisdom of Crowds.

Abilene Abilene Paradox: The Abilene Paradox describes a group dynamic whereby
each member mistakenly believes their preferences are out of step with the
Paradox rest of the group. Subsequently, under the misguided assumption that the
other group members prefer it, they collectively agree to a decision that no
one individual thinks is a good idea.

Implication
To counter the influence of social conformity, encourage team members
or customers to push back on their assumptions by creating a feedback
“safe word”. In this way, playing devil’s advocate can actually become a
constructive norm.

Harvey, J. B. (1974). "The Abilene paradox: the management of agreement".

Organizational Dynamics. 3: 63–80.
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T H E OBJECT IVIT Y T R A P
Principal When there’s an asymmetry of information between the decision maker (the
Agent) and the person they’re making choices on the behalf of (the Principal),
Agent we find ourselves with a moral hazard: the Principal is liable to make a
Problem decision that benefits their personal interests more than would benefit the
Agent.

Anchoring Anchoring is a particular form of priming whereby initial exposure to a

number serves as a reference point and influences subsequent judgements
about value.

In a classic study, after writing down the last two digits of their randomly
generated social security number, participants were asked to specify the
maximum amount they would pay for a rare bottle of wine. Those with the
highest digits, bid an average of $37.55, whilst those with the lowest digits bid
an average of $11.73.

In the context of B2B, the implications for pricing are immense.

Ariely D., Loewenstein, G., & Prelec, D. (2003) "Coherent arbitrariness":

Stable demand curves without stable preferences. The Quarterly Journal of
Economics, 118(1), 73-105.

Framing “Framing” information is a verbal and psychological device that changes

people’s perspective, understanding and then behaviour according to the
way that information has been presented.

The way in which an outcome is framed can effect our subsequent choice.
For example, it has been found that doctors can increase the number of
people that willingly agree to surgery by framing the survival rate as 90%
chance of success rather than 10% of mortality. This framing causes us to focus
on the “survival” and discount the “mortality”, giving a potentially lifesaving
intervention closer consideration.

Implication
In a B2B context, framing can be useful in helping customers to balance the
potential risks and benefits of a product.

Kahneman, D. & Tversky, A., (1981). The framing of decisions and the
psychology of choice. Science, 211(4481), 453-458

Kahneman, D. & Tversky, A., (1981). The framing of decisions and the
psychology of choice. Science, 211(4481), 453-458.
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Behavioural Science Principles Profiled

Loss The psychological pain of losing is twice as powerful as the pleasure of

gain. That is to say, we’d far prefer to not lose £5 than to find £5 in the street.
Aversion: Consequently, loss aversion impacts our risk taking behaviour as well as the
way we respond to incentives.

Following these implications, be quicker to highlight what clients risk missing

out on, and instead of incentivising customers with a discount, potentially
offer them the chance to dodge a surcharge.

Kahneman, D., & Tversky, A. (1979). Prospect theory: An analysis of decision

under risk. Econometrica, 47, 263-291.

Social Proof In situations of uncertainty, we look to the actions of others to help guide our
decisions. This phenomenon is evolutionarily hard-wired and rooted in the
evolved assumption that the people around us have a better understanding
of the current situation than we do. Social proof has particular applications to
e-commerce, where we see customers routinely looking to review websites
like TripAdvisor or Yelp to see what other people have decided when faced
with similar choices.

Implication
In many ways, fame operates as a form of social proof, and can be leveraged
as such for a B2B audience.

Cialdini, Robert B. Influence: Science and Practice. New York: Harper Collins
College Publishers, 1993.

Amblee, N., & Bui, T. (2011). Harnessing the influence of social proof in
online shopping: The effect of electronic word of mouth on sales of digital
microproducts. International Journal of Electronic Commerce, 16(2), 91-114.
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T H E OBJECT IVIT Y T R A P
Defaults When at risk of decision fatigue, we have a tendency to go with the flow when
presented with pre-set options. Opt-in / opt-out choices are perfect examples
of this. For example, a large national railroad in Europe changed its website to
automatically include seat reservations with ticket purchases (at an additional
cost of £1-£2), unless the customer actively unchecked a box on the online
booking form. The proportion of tickets including reservations jumped from
9% to 47%, earning the railroad an additional $40 million annually.

Implication
Think carefully when positioning options related to your service offering.
Their ordering will (disproportionately) influence your customer’s decision.

Goldstein, D.G., Johnson, E.J., Herrmann, A., & Heitmann, M. (2008). Nudge
Your Customers Toward Better Choice, Harvard Business Review, December
2008 Issue.
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T H E OBJECT IVIT Y T R A P
First Published in July 2020 by The B2B Institute
at LinkedIn

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