Since my wife was going to be away for a few days last month, she anxiously read me the instructions on the bottle of Night Nurse, knowing full well that I wouldn’t do so myself.* ‘It says here that you should under no circumstances take this medicine for more than four consecutive nights,’ she said nervously. Immediately I felt the placebo effect doubling its power. The fact that it should not be taken in large amounts is proof of its potency.* Which brings me, again, to Red Bull.
4.9: The Red Bull Placebo
Red Bull is among the most successful commercial placebos ever produced – its powers at hacking the unconscious are so great that it is repeatedly studied by psychologists and behavioural economists all over the world, including the great Pierre Chandon at INSEAD, one of the top business schools in Europe. So potent are the drink’s associations that the very presence of the logo seems to change behaviour. However, no command economy could ever have produced Red Bull, and nor could a bureaucratic large multinational – it took an entrepreneur.
The most plausible explanation for the incredible success of Red Bull lies in a kind of placebo effect. After all, it shares many of the features of a great placebo: it’s expensive, it tastes weird and it comes in a ‘restricted dose’. In its early days, Red Bull also benefited from repeated rumours that its active ingredient, taurine, was about to be banned. In addition to the price and the taste, the small can is particularly potent. You might expect a new soft drink to be distributed in a standard, Coke-sized can; perhaps we notice the small tin in which Red Bull is sold and unconsciously infer, ‘That must be really potent stuff: they have to sell it in a small can because if you drank the full 330ml, you’d probably go doolally.’
A 2017 article in the Atlantic by Veronique Greenwood suggested that the risk-taking behaviour associated with cocktails containing caffeine and alcohol might be caused less by the drink itself and more by our perception of it. Greenwood explained that in 2010, the sale of such pre-packaged drinks was already banned by the FDA because of a concern that caffeine would mask the alcohol’s effects. This theory seemed to be confirmed by a 2013 study which found that people consuming such drinks were twice as likely to be involved in an alcohol-linked car accident or a sexual assault as those who had drunk alcohol without caffeine.
A more recent study described by Greenwood suggests that the effect might be psychological rather than chemical. Researchers from INSEAD and the University of Michigan asked 154 young Parisian men whether they believed that energy drinks intensified the effects of alcohol. Each then drank the same cocktail of vodka, fruit juice and Red Bull, but it was labelled as either ‘vodka cocktail’, ‘fruit juice cocktail’ or ‘vodka Red Bull cocktail.’
All the men were then set three tasks. First, they played a gambling game in which they won money each time they inflated a balloon a little further, with a chance that they would lose everything if it popped. The next task involved looking at photos of women and considering whether they thought they would get their numbers if they approached them in a bar. Finally, they completed surveys describing how drunk they felt and how long they would wait before driving. The results showed a clear trend: although everyone had drunk exactly the same drink, the ‘vodka Red Bull group’ reported feeling much drunker, took more risks than the others and were more confident when it came to approaching women. Furthermore, the effect appeared to be stronger in men who believed that mixing energy drinks and alcohol makes you take risks and reduces inhibitions, suggesting that the altered behaviour is not caused by the drink’s composition but by what you believe it does to you. The one area where this group was more risk-averse was in relation to driving – once again, an attitude based on the perceived and not the actual effect of the drink.
According to Pierre Chandon, the branding of Red Bull, through slogans like ‘Red Bull gives you wings’ or the extreme sport competitions they sponsor, may not merely determine whether people buy the product but also how they respond to its name in a cocktail and how they interpret its effects. Are there lessons here that pharmaceutical companies could learn from? For instance, rather than merely putting medications in containers with a childproof cap, might they insist that they are kept in a metal container with a combination lock? After all, even if the contents aren’t particularly poisonous or potent, our inner monkey can deduce that they are – remember that the prefrontal cortex isn’t involved in this decision at all, and that it is the monkey alone who decides whether a placebo works.
To those five giant industries that exist by selling mood-altering substances – alcohol, coffee, tea, tobacco and entertainment – should we add the placebo industry? After all, it’s not just the purchase of cosmetics that can be explained in this way – I would contend that a large proportion of consumerism is designed to achieve the same thing. In fact, much luxury goods expenditure can only be explained in this way – either people are seeking to impress each other, or they are seeking to impress themselves.* Is almost everything a mood-altering substance?
4.10: Why Hacking Often Involves Things That Don’t Quite Make Sense
So signalling to ourselves or others – whether to obtain a health benefit (boosting the immune system), applying make-up (boosting confidence) or buying luxury goods (boosting status) – always seems to come accompanied by behaviours that don’t make sense when viewed from a logical perspective. However, rather than being a coincidence or a regrettable by-product, it may be a necessity.
For something to be effective as a self-administered drug, it has to involve an element of illogicality, waste, unpleasantness, effort or costliness. Things which involve a degree of sacrifice seem to have a heightened effect on the unconscious, precisely because they do not make logical sense. After all, eating tasty, nutritious food is unlikely to signal anything to the immune system, since it doesn’t feel out of the ordinary; drinking something foul, on the other hand, carries a greater amount of significance, since it is something you only do under unusual circumstances.
Think back to earlier in the book. Our body is calibrated not to notice the taste of pure water, because it is valuable in evolutionary terms that we notice any deviation from its normal taste. The qualities we notice, and the things which often affect us most, are the things that make no sense – at some level, perhaps it is necessary to deviate from standard rationality and do something apparently illogical to attract the attention of the subconscious and create meaning. Cathedrals are an over-elaborate way of keeping rain off your head. Opera is an inefficient way of telling a story. Even politeness is effectively a mode of interaction that involves an amount of unnecessary effort. And advertising is a hugely expensive way of conveying that you are trustworthy.
My contention is that placebos need to be slightly absurd to work.* All three elements that seem to make Red Bull such a potent mental hack* make no sense from a logical point of view. People want cheap, abundant and nice-tasting drinks, surely? And yet the success of Red Bull proves that they don’t. Something about these three illogicalities may well be essential to its unconscious appeal, or to its potency as a placebo. If we are to subconsciously believe that a drink has medicinal or psychotropic powers, perhaps it can’t taste conventionally nice. Imagine a doctor saying, ‘I have some pills here to treat your extremely aggressive cancer – take as many as you like. Now, would you like them in strawberry or blackcurrant flavour?’ Somehow, that last sentence doesn’t quite work.
If you look at behaviours to hack the unconscious, they all seem to have an element that is wasteful, unpleasant or downright silly. Cosmetics are insanely overpriced and time-consuming to apply. Alcohol, when you think about it, doesn’t really taste very nice: on a really hot day when you are parched, which would you honestly prefer – a glass of Château d’Yquem or a raspberry Slush Puppie? Placebo treatments like homeopathy involve a large amount of ritual and nonsense. Medicine tastes horrid.
At some point, we have to ask a vital question: do these various things work despite the fact that they are il
logical, or do they work precisely because they are? And if our unconscious instincts are programmed to respond to and to generate behaviours precisely because they deviate from economic optimality, what might be the evolutionary reason for this? It seems rather like the lesson that is taught to aspiring journalists: ‘Dog Bites Man’ is not news, but ‘Man Bites Dog’ is. Meaning is disproportionately conveyed by things that are unexpected or illogical, while narrowly logical things convey no information at all. And this brings us full circle, to the explanation of costly signalling.
Part 5: Satisficing
5.1: Why It’s Better to Be Vaguely Right than Precisely Wrong
The modern education system spends most of its time teaching us how to make decisions under conditions of perfect certainty. However, as soon as we leave school or university, the vast majority of decisions we all have to take are not of that kind at all. Most of the decisions we face have something missing – a vital fact or statistic that is unavailable, or else unknowable at the time we make the decision. The types of intelligence prized by education and by evolution seem to be very different. Moreover, the kind of skill that we tend to prize in many academic settings is precisely the kind that is easiest to automate. Remember, your GPS is computationally much more capable than you are.
Here’s a typical school maths question:
Two buses leave the same bus station at noon. One travels west at a constant 30mph, while the other travels north at a constant 40mph. At what time will the buses be 100 miles apart?*
Here’s a typical real-life problem:
I need to catch a plane leaving Gatwick at 8am. Should I get there by train, taxi or car? And at what time should I leave the house?
The odd thing about the human mind is that many people would find the first question difficult, and the second easy, yet the second question is computationally far more complex. This says more about the evolution of our brains than the difficulty of the problem. The reason is that the first question is tailor-made for computation, being what you might call a ‘narrow context’ problem. It assumes an artificially simplified, regularised world (where buses miraculously travel at a constant speed), it involves very few variables (all of which are numerically expressible, and allow for no ambiguity) and it has one single, incontrovertibly correct answer.
The question of how to get to Gatwick is what you might call a ‘wide context’ problem. It allows for vagueness and multiple right answers, and it doesn’t demand absolute adherence to any precise rules. There is no formula for the solution, it allows scope for all kinds of possible ‘right-ish’ answers and all kinds of information can be taken into account when coming up with an answer.
These are the problems we seem instinctively better equipped to solve, but which computers find hard. If I were to delve into my unconscious and uncover some of the variables at play in my brain when I next have to get to the airport, they might include ‘Is it raining?’, ‘How much luggage do I have?’, ‘How long am I going to be away for?’, ‘What is the average time via the M25 versus taking the A25?’, ‘What is the variance of journey time on the M25 versus the A25?’* and ‘Does my flight leave from the North or South Terminal?’
If you think of getting to Gatwick as a narrow problem in the way your GPS does – a simple question of getting to the airport as quickly as possible – some of these factors may seem irrelevant, but they are all important in real life. The weather affects the traffic. If I am going away for two weeks rather than one night, it affects the cost of parking, and therefore the relative cost of going by train, car or taxi – and the amount of luggage I have. The variance of travel time on the M25 matters to whether it’s worth risking. And heavy luggage makes the train less appealing, especially if you are flying from the North Terminal, which is much further away from the rail station.
It’s interesting that we find solving complex problems like this so easy – it suggests that our brains have evolved to answer ‘wide context’ problems because most problems we faced as we developed were of this type. Blurry ‘pretty good’ decision-making has simply proven more useful than precise logic. Now, I accept that the need to solve ‘narrow context’ problems is much greater today than it was a million years ago, and there’s no denying the contribution that rational approaches have made to our lives – in fields such as engineering, physics and chemistry. But I would also contend that our environment has not changed all that much: most big human problems, and the majority of business decisions, are still ‘wide context’ problems.
The problems occur when people try to solve ‘wide’ problems using ‘narrow’ thinking. Keynes once said, ‘It is better to be vaguely right than precisely wrong’, and evolution seems to be on his side. The risk with the growing use of cheap computational power is that it encourages us to take a simple, mathematically expressible part of a complicated question, solve it to a high degree of mathematical precision, and assume we have solved the whole problem. So my GPS answers a narrow question like ‘How long will it take to drive to Gatwick?’ brilliantly, but the wider questions like ‘How should I get there and when should I set off?’ still remain. The GPS device has provided a brilliant answer to the wrong question. In the same way, companies can, for instance, optimise their digital advertising spend to a huge degree of precision, but this does not necessarily mean that they have answered the wider marketing questions, such as ‘Why should people trust me enough to buy what I sell?’
We fetishise precise numerical answers because they make us look scientific – and we crave the illusion of certainty. But the real genius of humanity lies in being vaguely right – the reason that we do not follow the assumptions of economists about what is rational behaviour is not necessarily because we are stupid. It may be because part of our brain has evolved to ignore the map, or to replace the initial question with another one – not so much to find a right answer as to avoid a disastrously wrong one.
The unconscious question is not the one we are supposed to ask, and the one that might be ignored when we try to construct rational rules for decision-making. Take the case of an advertising agency pitching to potential clients. It’s common for clients at such pitches to be furnished with an ‘evaluation matrix’ or ‘scorecard’, designed to ensure the process is transparent and objective. The intention is that each agency’s presentation is marked on criteria such as quality of strategy, creative work, cultural fit, knowledge of sector and cost-competitiveness. The idea is that these things are scored independently and then totalled to determine the winning agency but if you ask anybody who’s been involved in this procedure, they will often admit that they simply decided which agency they wanted to win and back-filled all the numbers accordingly. It may be that in situations like this what people do is substitute a completely different question to the ones they have been given, and answer that instead. This practice of answering an easier proxy question is what leads to a lot of ‘irrational’ human behaviour. It may fall short of being perfectly rational and it may not even be conscious, but that’s not to say that it isn’t clever.
Never call a behaviour irrational until you really know what the person is trying to do. A few years after university, I was living in London with a group of friends and we had each accumulated just about enough money to buy our first ever second-hand cars. We all did exactly the same thing without knowing why – we returned to the small towns where we had grown up and bought a car from someone vaguely known to our parents, whether an acquaintance, friend or relative. To an alien onlooker, this behaviour would seem bizarre, especially since second-hand cars in the provinces are slightly more expensive than they are in London. But the question we were unconsciously asking was not, ‘What car should I buy, and where?’, but ‘Who could I find trustworthy enough to sell me a really cheap car?’ We weren’t trying to buy the best car in the world – we were trying to avoid the risk of buying a terrible car.
The question we were asking, ‘Who can I find who won’t rip me off?’, was a sensible one:
the one thing you can’t afford to do when your budget is so tight, is fall victim to a con artist, which is why we needed someone with reputation at stake. That substitute question – ‘Who do I trust to sell me an X?’ – seems a perfectly reasonable proxy for buying good products. Find someone who has reputational skin in the game, ask their advice, and buy from them.*
Like bees with flowers, we are drawn to reliable signals of honest intent, and we choose to do business where those signals are found. This explains why we generally buy televisions from shops rather than from strangers on the street – the shop has invested in stock, it has a stable location and it is vulnerable to reputational damage. We do this instinctively; what we are prepared to pay for something is affected not only by the item itself but by the trustworthiness and reputation of the person selling it.
Try this simple thought experiment. Imagine you have turned up at somebody’s home to look at a second-hand car. You assess the condition of the car, which is parked on the street, and having decided it is worth £4,000, you ring on the doorbell, prepared to offer that amount. In scenario A, the door is opened by a vicar.* In scenario B, the door is opened by a man naked except for a pair of underpants. The car has not changed, but what has changed is its provenance. The vicar is likely to be a man with a great deal invested in his reputation for probity, while the second man is clearly immune to any sense of shame. Would you seriously say that the amount you are prepared to pay would not increase in the first instance and decrease in the second?
It seems silly to regard this behaviour as irrational when it is really rather clever. My late mother knew absolutely nothing about cars, but had an eagle eye for people.* It would have been interesting to set her the task of buying ten cars based on her instincts about the people selling them, while at the same time tasking ten automotive engineers with acquiring ten cars at auction. I’m confident the cars my mother bought would have been every bit as reliable as the cars chosen by the engineers, perhaps more so.
Alchemy Page 19
