Rory Sutherland, Vice Chairman of Ogilvy UK: The Ambassadorial Years How I Made It
In ‘Part Two’ of our extended interview with Rory Sutherland, we discuss Mad Men, the importance of behavioural economics, and the admirable qualities of Ronald Reagan and Arnold Schwarzenegger. We also find out exactly what the Vice Chairman of Ogilvy UK does with his precious time. He may simply describe himself as the ‘Fat bloke at Ogilvy’ on his Twitter profile, but he’s certainly much more than that. We reckon it’s about time you found out why!
From your role as Head of Copy, you moved into the role of creative director. The frequent misconception, mainly perpetuated by Mad Men, is that the creative director simply sits around drinking whisky, smoking cigarettes and pitching copy in an emphatic manner. Do you feel that this depiction detracts from people’s understanding of what a creative director actually does? What is it really like?
I’m not sure how realistic Mad Men is, even in the time in which it’s set. I’m sure there were agencies that worked exactly like that, but they weren’t in the majority. Jeremy Bullmore, who actually remembers the era, says that J. Walter Thompson (JWT) in the 1960s was an incredibly staid place, where the idea of having alcohol in the office would have been met with absolute horror. However, that’s not to say that it didn’t happen. After all, there were certainly eras in British advertising which were pretty hedonistic.
Nonetheless, the job of the creative director is one that has administrative components to it, managerial components, and large amounts of coordination. An enormous amount of it involves deciding which team works on which brief. Since advertising agencies are now paid by the hour, a bit like law firms, the whole thing is just a bit more fraught, and the administrative component has undoubtedly come to the fore.
After that, you were named Vice Chairman of Ogilvy One, before eventually becoming Vice Chairman of the entire Ogilvy Group in the UK. What does your role involve now?
I still try and write a bit of copy once a month or so, if I possibly can. One of the things I do, which takes up around 30% of my time, is trying to take what we do and translating it into language which is appealing and interesting to a wider public, whether that wider public may be chief executives or finance directors.
The whole issue of what you might call brand value, or intangible value, actually raises some fundamental questions of economics, of business and of how companies should actually be run, motivated, measured and incentivised.
One of the things I try to do is to use the discretion given to me in the use of my time to actually look at advertising obliquely. Some of the questions that advertising raises about the nature of value and how humans make decisions have enormous wider implications for business decision making, and I think we’ve lost that. I think we’ve become ad shops, where people say: “Here is some money, make an advertisement.”
The wider implications of the questions that making an advertisement forces you to ask are sometimes being lost. Jeremy Bullmore would make the point that the process of producing an advertisement is actually valuable in itself, even if you never run the advertisement, simply because of the questions it forces you to ask.
If you want to, and I do, you can actually take some of what you learn in advertising and parlay it into some very fundamental philosophical questions. For instance, how people choose products is largely based on grounds of brand fame, and people see brand fame as a proxy for product quality.
Now, to someone brought up on classical economics or engineering, as many people in business now are, that’s simply bonkers. They believe you should develop an independent measure of product quality, you should weight the different factors which constitute quality, and you should make a decision on a weighted average.
However, if you read some of the very best scientists, mathematicians and psychologists in the world, such as Nassim Nicholas Taleb and Gerd Gigerenzer, they would actually say that decision-making under uncertainty, the heuristic method, which is to take two or three measures and use them as a proxy, leads to better decisions than the scientific method. Now, that is almost impossible for most scientists to actually cope with.
Nonetheless, Taleb and Gigerenzer would actually say that the way in which people make decisions has a hidden logic to it. Indeed, advertising generates fame, and brand fame is assumed to be a proxy for product quality. Anybody who advertises does so because they have long-term faith in their product; it’s an upfront investment which you would not make if you weren’t expecting your product to go big. And therefore actually advertising is an indicator of a product which is likely to be high-quality, or certainly a product which is very unlikely to be bad.
If you look at your life, and also bear in mind that our behaviour is learning behaviour: when you buy things manufactured by major brands, such as laptops, cars, clothing or food, you expect those products to be of high-quality.
For instance, the likelihood of the sandwich you buy which is branded M&S or Waitrose being sh*t, is pretty low. However, if you go to a petrol station and you buy one of those funny sandwiches made by someone you’ve never heard of, not all of them are sh*t, but one sandwich in ten is absolutely disgusting. Using brands as a strategy for avoiding disaster, by which I mean a revolting sandwich that gives you a stomach upset, is an extraordinarily astute strategy to adopt.
Funnily enough, advertising people have instinctively come to conclusions which are scientifically right. What they’ve failed to do is adopt science that’s sophisticated enough to justify their position, because to someone who’s got the mentality of an accountant or an economist, the way in which people are making decisions based on brands is bonkers.
There are two basic ways of making decisions: what you might call the statistical, pseudo-scientific or scientific way, which involves statistics, a certain interpretation of probability and a certain idea of mathematical purity, and then there’s the heuristic way. What’s interesting is that chess players play heuristically, they don’t play probabilistically. If you want a computer to beat a chess player, you have to actually teach it to use heuristics, because the number of variables that they’re required to compute in terms of probable moves is simply greater than the number of atoms in the universe; it’s too vast. So what you’re going to have to do is learn what data to eliminate and ignore, and make decisions based on heuristics.
When you catch a cricket ball you use heuristics, you don’t use maths. The heuristic you use is this: you look up at the cricket ball, you calculate the angle of gaze and you move towards it at whatever speed keeps that angle of gaze constant. If you can do that, you will then move yourself to within a couple of feet of the point where the ball is going to land. You don’t need to calculate for wind resistance; you don’t need to use a quadratic equation; you don’t have to understand gravity. If you follow that simple rule, and if it’s possible to do so, you will catch the ball. Now, what’s really fascinating there is that, actually, that method is a better way of catching a ball than using perfect mathematics.
What I think we need to do is understand advertising and marketing in terms of ‘real science’, not ‘sh*t science’; by which I mean the ‘real science’ of understanding Darwinian psychology, understanding heuristic algorithms and understanding behavioural economics. What we can do then is use advertising and marketing as a way of reshaping business so that it’s more human-friendly.
I think that’s the ultimate task. Ogilvy’s given me a degree of autonomy, and what I try and do with that autonomy is do things that our clients would never pay us to do; mainly because they don’t refer to the next year or the next quarter, they actually refer to the next three or four years.
What kind of things do you do as part of that responsibility?
I spent my time as the President of the IPA basically trying to encourage the advertising industry to adopt behavioural economics. For instance, I got speakers in, like Geoffrey Miller from the University of New Mexico at Albuquerque, to talk about the Darwinian motives behind brand choice.
Would the talks you did for TED also be part of that responsibility?
Absolutely. In the wider sense, both marketing and creativity need a few John the Baptists. I think we can actually take the very skills, the ways of looking at the world and some of the insights of advertising and spread them more widely.
My ultimate approach is that this will benefit us in two ways. Firstly, it will benefit humanity, because I genuinely think the models of business and decision-making have become autistic. Secondly, it will benefit the industry, because if you have a wider appreciation of the role of psychology in human happiness, in well-being, and, indeed, in business success, businesses will actually spend more time and attention on marketing.
And that in turn will then benefit Ogilvy?
Yes. To be honest, I think it will benefit the whole industry. I think it’s necessary to have people who have a whole industry view. Competition can, in some senses, be a great distraction, because you can obsess about your comparative set, and then forget to ask the really big questions.
Ogilvy will do particularly well out of a wider adoption of behavioural economics, simply because we have the mix of disciplines to actually take advantage of it. We’re not just an ad agency. In fact, the ad agency is probably only 30% of the overall group, and so we’re quite a future-proof organisation. Shopper marketing, medical and pharmaceutical advertising, direct marketing, digital marketing and PR are as much a part of our entity as conventional advertising. That gives us a particular advantage in profiting from the wider understanding of what marketing is and a wider definition of what it can do.
There are loads of people that enjoy competing with J. Walter Thompson or pitching against AKQA, or whatever, but I don’t get my rocks off on that anymore. It’s necessary to an extent. Competition is healthy; it keeps people lean and honest and all that sort of thing, but, at some point, you have to look after the category benefit.
At one level, philosophically, Coke needs Pepsi. The worst thing that could happen to Coke, in a way, is that Pepsi should cease to exist. There all sorts of reasons for that psychologically, not least because, people like to have a choice within a category. It’s very difficult to be a category of one. If you produce a car that’s too weird, no-one buys it, because, however good it might be, it doesn’t fit within a set. Electric cars will take off when Ford and Renault and Toyota produce electric cars. There are large numbers of things, where actually what you need to do is move the category rather than move an individual brand.
My role is to look at what one might call the whole industry view. There are plenty of people competing to be more profitable than ‘Agency B’ or to win business off ‘Agency C’, but my role is to try and look at the whole agency issue and see what we can do.
Obviously, you’re very passionate about this. Is this what you want to continue doing for the rest of your career?
Pretty much. Jeremy Bullmore, who’s the most worthwhile career adviser I’ve ever come across, makes a very interesting point that if you’re simply interested in doing ads and you just enjoy the process, you’ll be very successful in advertising up to the age of 35 or even 40. Whatever it is, whether it’s some change of life or change of outlook, if you then want to stay in advertising after the age of 40, you’ve got to get interested in the wider ‘whys’. You’ve got to get interested in the wider context of what you’re doing, the reason why you’re doing it and the economic role of what you do.
And so I think I’d be perfectly happy doing this. I like writing a column for The Spectator once a fortnight. I like writing for industry periodicals. I like writing as a way of helping you think. That’s another great thing you learn from being a copywriter: that actually you don’t really know what you think until you’ve tried writing about it; you can babble on and talk about things, but actually the act of putting things on paper is valuable in itself.
I also like the public speaking role because I think there’s a huge unmet need for wider education in terms of human behaviour, decision-making and psychology, and indeed the ultimate questions of human happiness and well-being.
Every business is ultimately dependent on the whims of human choice, psychology, trends and selection. And the extent to which businesses are happy to proceed as though the only information you need to know about people is what you can derive from a balance sheet is extraordinarily dangerous. Metrics in many cases are just designed to measure what’s numerically measurable; it’s not what’s really important at all.
Do you feel that your passion for behavioural economics is symptomatic of why Ogilvy is so successful in the advertising industry?
I don’t particularly take huge personal credit for the success of Ogilvy; I think there are far more individuals who have been more instrumental than I have.
Let me put it this way: I hope I’ve created a culture of inquisitiveness, and also prevented an anti-intellectual culture, which can sometimes happen in business. David Ogilvy wanted the agency to be the teaching hospital of advertising; a place which practices but also teaches and does research.
I hope I’ve helped a bit in thought leadership, but also in culturally creating an open-minded approach to what advertising is at Ogilvy; something which has enabled us to become a power house in terms of multi-disciplinary advertising.
We’re not especially dependent on any particular form of marketing communications for our survival, which allows us to be disinterested in our recommendations, open-minded in our approach to creative solutions. And if I’ve spent the last ten years doing anything, I hope it’s promoting that.
Finally, if you could give one piece of advice to aspiring ad men and women, what would it be?
If you want to go into the advertising business now, you need to be good at two things. If you want to be good at one thing, if you want to be the best tennis player in the world, for instance, that’s bloody difficult because there will always be a thousand people who are better than you. So, I would suggest that you mentally become a bi-athlete or a tri-athlete.
Statistically, it is vastly more likely that you will manage to develop a unique niche for yourself if you’re good at two or three things, rather than being the best at one.
This is why I also write for The Spectator, because I think that doing something else, other than your main job, is just good for you. It makes you better at your main job. David Ogilvy always sought out ‘creatives’ who were extensive browsers in all kinds of fields. He saw inquisitiveness and a broad church of interests as the mark of good copywriters or creative people.
Bizarrely and not very fashionably, I kind of idolise Ronald Reagan. He was a very good baseball commentator; he was a pretty good actor; he was a pretty good Governor of California; and he was a pretty good President. Well, hells bells, that’s not bad!
He mastered every single medium. He mastered radio, he mastered film, he mastered television and he mastered politics. I’ve got an astounding admiration for that. I admire the sheer breadth of the man. In an age of career politicians, everybody was disparaging this guy because he’d been an actor. Well, at least he’d done something else.
Would it be fair to say therefore that Arnold Schwarzenegger is the next Ronald Reagan?
Yes, Arnie has to be there. He’s genuinely extraordinary. He started off not speaking a word of English in Austria, and through bodybuilding he built himself up to a position where he’d actually be one of the Republican presidential nominees if it wasn’t for the fact that he wasn’t born in the United States.
One of the things I’ve loved this business for is that it’s allowed me to be a hybrid. Become a bi-athlete or a tri-athlete and you stand a much better chance of winning.
Check out the first part of our interview with Rory Sutherland here.
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