Data can prevent businesses from asking imaginative questions

The human mind does not run on logic any more than a horse runs on petrol, says Rory Sutherland. The Vice Chairman of advertising agency Ogilvy in the UK—who was in Mumbai to speak about his recently-released book Alchemy: The Surprising Power of Ideas That Don’t Make Sense—believes that businesses that are over-reliant on data tend to be under-reliant on instinct.

“Data gives you information when you need it and that’s reassuring for a business, but it can also prevent you from asking much more imaginative questions. For example, should we do something because everyone does it and that’s what people want, or should we launch a business that could be successful because there is a need that has not been recognised and there’s no one else in that space?,” asks Sutherland. “If all businesses look at the same data and deploy the same logical techniques, then businesses will become more alike, which will destroy economic value.”

The book, published by Penguin, draws from the ad-man’s three-decade long career in the industry to explain why logic and science must be kept aside to discover seemingly irrational solutions that appeal to people and solve human problems.

Sutherland, 53, who set up the behavioural economics division at Ogilvy that employs psychology graduates to “test counterintuitive things because no one else does”, uses anecdotes and psychology research to explain how irrationality and the desire to take risks has helped create successful brands like Red Bull, McDonald’s, Wikipedia and Starbucks, which started out with ideas that did not make complete business sense.

While calling the Indian advertising industry a “powerhouse” of brilliant ideas and content, Sutherland believes that there is a need for marketing and advertising to be defined by a universally-accepted science too. “Finance, economics and other parts of the business world can draw on some form of science make their case, but the language of marketing seems like astrology, only sounding reasonable if you are talking among fellow believers. So creating a common code or classification will be useful.”