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The Four-Letter Code to Selling Anything: Derek Thompson (Transcript)

Full text of journalist Derek Thompson’s talk: The four-letter code to selling anything at TEDxBinghamtonUniversity conference.

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Derek Thompson – Senior Editor at The Atlantic

For thousands of years, some of the smartest people in the world have been asking themselves versions of the same question: why do we like what we like? Is there a formula for beauty, for popularity, for human affinity?

And the ancient Greeks said yes, of course, there is. It’s the golden ratio 1.62 etcetera etcetera to 1 and then the Enlightenment thinkers said yes of course there is; it’s Kant’s theory of aesthetics.

But today we don’t have the golden ratio; we don’t have philosophers. We have Google and Facebook. We have advertisers.

And in the advertiser formula, the first variable is always novelty. This is a scientific fact; they actually went through several decades ago all of the words they could possibly find in all the advertisements that were out there, and the most common word in all of those ads wasn’t ‘buy’, wasn’t now; wasn’t risk-free warranty. It was new.

We are living in a cult of novelty. Companies want us to like new things, to buy new things, to crave new things. But the truth is that we don’t like novelty. In fact, we hate it.

According to the mere-exposure effect, one of the oldest and most robust theories in the history of psychology, the mere exposure of any stimulus to you over time will bias you toward that stimulus. In English, familiarity good. And indeed when you think about it, we seek out new songs. But the songs that we most reliably enjoy are those with familiar chord structures and timbers.

We seek out new movies but every year this century, a majority of the top ten films in America have been sequels, adaptations, or reboots. Familiar, familiar, familiar.

In fact, maybe the best proof of the power of familiarity is that thing that is so familiar to you, your own face. It turns out that people prefer the face they see in mirrors to the face they see in photographs. Maybe you have a friend who complains constantly about how he or she looks in Facebook photos but is often constantly admiring his or herself in the mirror.

Well, this is not pure vanity; this is mere exposure effect. The face is slightly asymmetric. We see different versions when we see a reflection versus a photo. And if you’re not a celebrity, then the version you’re most used to seeing is not in a photograph but rather in the most common reflection in the world in a mirror. You prefer that version of your face, not because it’s you at your most beautiful, but because it’s you at your most familiar.

In fact, the power of familiarity seems so deep that people think it must be written into our genetics. The evolutionary theory for the preference for the familiar is that if you’re a hunter-gatherer and you’re the trawling the Savannah of Africa, and you see a plant or an animal and you recognize it, that’s a very good sign that plant or animal has not killed you yet. So of course you should prefer it.

But this creates an enormous problem for creators, for creative types, because I just told you that people only like new things if they’re just like old things.

So the question before us today is: how do you balance familiarity and surprise in such a way as to design hits, to design things that people love? Is it possible to engineer a familiar surprise?

And to begin to answer that question, I want to tell you a short story about a man who was a hero of mine, a hero of my book but also a man that I would imagine 9% to 95% of this room does not know. His name is Raymond Loewy, and he designed the 20th century.

Raymond Loewy was a French orphan who came over to the United States after World War I and his brother picked him up in a cab. And this is the 1920s where they drive to Downtown Manhattan where one of the tallest buildings down there is the Equitable Building, which looks a bit like a tuning fork with sort of two large buildings rising into the sky.

And Raymond Loewy takes an elevator to the top of this building and he looks out over Manhattan from this vista. And he’s expecting from his dreams in Paris to see a world that is beautiful, that is round, that is feminine. But the New York and inferrals in front of him is the exact opposite. It’s grungy; it’s noisy; it’s the hokiness of the Industrial Age.

And Loewy makes a promise to himself and his brother; he says “I’m going to devote the rest of my life to beautifying America in my image.” And Loewy did just that.

Raymond Loewy designed the most famous Car of The 20th Century, the 1953 Studebaker. He designed the most famous train and locomotive of the 20th century, the Pennsylvania Railroad GG1. He designed the modern Greyhound bus and the modern tractor, the modern Coca-Cola fountain. He designed that pencil sharpener that looks like an egg with a little spindle coming out of it that you’ve seen in a hundred thousand classrooms.

He designed the logos for Exxon and USPS. He basically designed all of 1950s Americana. And in fact, one day Raymond Loewy was hanging out with his friend and he saw the President’s plane take off. And he said it looks gaudy. So President Kennedy invited Loewy to the Oval Office where they sat on the floor and cut little papers until they achieved the perfect design for Air Force One.

And in fact, the design that Raymond Loewy came up with there on the floor of the Oval Office with JFK still adorns the most famous plane in the world today.

So the question is: what did this man possibly understand about human psychology that he knew what we wanted from planes and trains and automobiles? This man was like Don Draper meets Steve Jobs for the 20th century. He understood everything.

Unfortunately, for us, Raymond Loewy had a grand theory of everything. It was called MAYA. M-A-Y-A, most advanced yet acceptable.

Raymond Loewy said that human preferences are torn between two opposing forces. On the one hand, there is neo philia, a love of new things and an appreciation for the new, a need to discover. But on the other hand, there is neophobia, a fear of anything that is too new, a deep conservativeness.

And Loewy said that in order to make hits, you need to make products that live right at that intersection of the familiar surprise. To sell something familiar, you have to make it surprising. But to sell something surprising, you have to make it familiar.

And Loewy was not a scientist. But this theory has been proved and validated by scores of studies and meta studies since he died. It has been used to explain hits in technology, in academics, in culture and even in politics.

Let’s start with technology. Technologists are often in the position of having to make something new and then make that new thing popular with an audience that doesn’t understand it. This was the problem recently at Spotify. Spotify, obviously the famous streaming music company, which was developing its app which probably many people in this audience have used called Discover Weekly.

If you haven’t used Discover Weekly, every single Monday, Spotify will dump 30 songs onto your phone and initially they wanted those 30 songs to be entirely new so that people had never heard the songs and they had never heard the artists. But when they were initially testing it, there was a bug in the algorithm that accidentally lets slip through some familiar songs and some familiar artists. So they quickly fixed the bug and they kept testing.

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