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How to think, not what to think

Article · December 2012

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Terry Grapentine
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MARKETING FORUM
IDEAEXCHANGE
A
bout 10 years ago, Professor Don Lehmann cautioned
that, “in increasingly challenging times, the pressure to
make quick decisions increases. Consequently, reflection
and careful consideration are too often viewed as luxu-
ries.” This pressure was likely influenced by the rapidly peaking
and deflating Internet boom, and the subsequent sharp recession
at that time.
Now looking at the last 10 years there is even more pressure
for quick decisions. We’ve had a much bigger recession. Company
management teams operate even leaner than before. There is also
increasing support in the media (popular, business and academic)
for quickness over consideration. For example, Malcolm Gladwell’s
Blink: The Power of Thinking Without Thinking (Little, Brown & Co.
2005) argues that people often make sound decisions based on
small observations of experience.
The last decade also marks a huge growth phase for digital me-
dia, e-commerce and social networking. Among other outcomes,
these developments have generated many times the volume and
velocity of electronic data than existed previously. For marketers,
this data is raw material of consumer experience and creates the
expectation that it will enable even faster (e.g., real time) assess-
44 | M A R K E T I N G M A N AG E M E N T | W I N T E R 2 012
ment of how to respond to consumers.
Marketers should be open to many new types of information to
help generate insights and facilitate effective action. But the faster
and even more automated path to action may not necessarily al-
ways be better. Someone is still responsible for the interpretation
of data. And people may disagree on the interpretation (e.g., how
many opinions are there on “is the economy improving?”), leading
to confusion.
While some of the traditional methods for assessing the
soundness of information seem outdated and maybe irrelevant
(probability sampling, for example), there is still a need for some
ground rules for assessing accuracy, drawing conclusions and
making recommendations. As Lehmann put it in his MSI Working
Paper, “The Relevance of Rigor” (03-105, 2003): “Intuition works
for the gifted; rigor is for the rest of us. Give me facts described as
stories, not stories represented as facts.”
In the article that follows, Terry Grapentine offers a perspective
on the role science has to play in helping marketers take effective
actions. Even when time is compressed there is room for consider-
ation. ­
— Gordon Wyner
 How to
Think, Not
S
olving
marketing
What to Think
prob-
lems the
traditional way is
not working well,
with hundreds of Move beyond ‘flavor-of-the-month
millions of dollars
being wasted every marketing problem solvers’
year. Major business
By Terry Grapentine
publications—such as The
Wall Street Journal, Bloomberg
Businessweek, Forbes and Fortune—
regularly chronicle and try to explain
business failures due to flawed marketing
thinking and business decisions. The topic keeps authors
busy. I recently searched “marketing success” on the
Amazon books website and obtained nearly 28,900 results.
Under “business success,” the list approached 61,000. With
so much written on the subject, why do businesses con-
tinue to make dumb marketing mistakes? There must be a
better way.
Instead of having “flavor-of-the-month marketing prob-
lem solvers” guiding our thinking, we can reason more
rigorously about our problems like a scientist solving a
research problem or a mathematician analyzing a puz-
zling mathematical conjecture. Just think about some of
the most recent scientific success stories—detection of the
Higgs boson (physics); mapping of the human genome (bi-
ology); and the discovery of plate tectonics (geology). We
must begin to apply the principles of scientific reasoning
that led to these discoveries to solve marketing problems,
but we first need to learn how.
This article lays the groundwork for helping Marketing
Management readers understand why and how applying
selected principles from the philosophy of science can
improve decision-making effectiveness. Unlike many other
kinds of business advice, this article focuses on how to
think, not what to think.
The Need to Synthesize
New and larger data sources are overwhelming the mar-
keting decision-making process. Consider the following
emerging areas of
knowledge confront-
ing today’s market-
ers:
“Big data.” The
analysis of consumer
information gleaned
from mobile de-
vices, the Internet, and
larger and ever-growing
customer-relationship-
management databases. Big
data has become so important it
was discussed at the World Economic
Forum Annual Meeting 2012 in Davos,
Switzerland.
Qualitative data mining. As part of
big data, companies can now mine social
networks, blogs and message boards to examine brand
sentiment and other consumer attitudes affecting brand
choice.
Neuroscience. By exposing consumers to marketing
stimuli, we can now map how the mind interprets such
information.
Behavioral economics. Academic authors such as Dan-
iel Kahneman, “Thinking Fast and Slow” (Farrar, Straus
and Giroux, 2011) and Dan Ariely, “Predictably Irratio-
nal” (Harper Perennial, 2010) have discovered how subtle
changes in the context and circumstances surrounding
human decision making (e.g., making a brand choice) can
influence those decisions.
Making Sense of It All
This is where the philosophy of science and critical think-
ing skills can come to the marketer's aid. I give three brief
examples on how to apply scientific reasoning to decision-
making drawn from my book: 1) the difference between
“attributes” and “constructs,” 2) the concept of coherence;
and 3) building strong marketing propositions.
Attributes vs. constructs. To generate more sales and
profits, managers often want to know what attributes they
can add or modify in a product—aside from a reduced
price. Rarely is there such a single attribute. For example,
W I N T E R 2 012 | M A R K E T I N G P OW E R . CO M | 45
 28,900
The number of results
the author’s search for
“marketing success”
yielded through Amazon.com’s books department.

an international office furniture manufacturer wanted to a set of conflicting subsystems” (The Structure of Empirical
develop a new cubicle design that would create a more Knowledge, Harvard University Press, 1985).
“comfortable working environment.” You can imagine that We can develop a coherent belief system
this task is complex, because it is a multidimen- by conceptualizing it in three
sional undertaking. It involves many dif- dimensions, as measured
ferent characteristics such as lighting, by (a) the number of
color, the length and depth of a cu- individual beliefs
bicle’s work area, the shape and in the system,
“feel” of cabinet door handles
and so on. In short, the idea "The intangible aspects (b) the variety
of sources
of a “comfortable working
environment,” is something
of a product are often more from which
those beliefs
that is both real and, at
the same time, intangible.
critical than a product’s are based
and (c) the
The intangible aspects of a
product are often more criti-
tangible features in affecting extent to
which these
cal than a product’s tangible brand choice." beliefs have
features in affecting brand been empirically
choice. supported through
Scientific reasoning lesson. testing, which is a
When formulating marketing decisions, measure of their validity.
look beyond mere product attributes that your How, then, should you go
research might uncover and try to understand about strengthening the validity of your
the intangible dimensions that better reflect marketing belief system? Answer: Learn as much as
the needs and wants of your customers. you can in a diversity of fields. Read more, especially in
Coherence. Marketing strategies are generally based on new fields that are influencing marketing thought, such as
decision makers’ beliefs about their markets. Therefore, in behavioral economics and neuromarketing. Talk to indus-
applying scientific reasoning to marketing, a fundamental try experts and attend marketing conferences.
question to ask is: “How justified are my beliefs?” Scientific reasoning lesson. The more you know, the
The “coherence theory of empirical justification,” or more coherent your marketing belief system will be, and
simply “coherence” for short, can help. As defined by phi- the better you can justify the beliefs supporting marketing
losopher Laurence Bonjour, coherence is, “a matter of how recommendations.
well a body of beliefs ‘hangs together;’ how well compo- Develop strong marketing arguments. A marketing
nent beliefs fit together, agree or dovetail with each other, recommendation is a kind of logical “argument,” a set of
so as to produce an organized, tightly structured system statements comprising premises and a conclusion.
of beliefs, rather than either a helter-skelter collection or All recommendations in marketing are arguments in

46 | M A R K E T I N G M A N AG E M E N T | W I N T E R 2 012
 which one’s conclusion (e.g., we should increase advertis- How plausible are they to your audience? How can you
ing by 10%) is supported by a variety of premises (e.g., we make the premises more plausible? This requirement of
entered a new sales territory where consumers have making a good argument is called fulfilling the argu-
not heard of our brand). ment’s “truth condition.”
All marketing arguments Scientific reasoning lesson: Study
are inductive. This means the elements of good inductive
that the premises of the logic. The more you are able
arguments, if true, do to construct strong and
not guarantee their
conclusions. There
"The more you are able to cogent marketing recom-
mendations, the more
are many reasons
for this, including
construct strong and cogent persuasive you’ll be
in leading others and
that marketing
decisions are
marketing recommendations, making effective mar-
keting recommenda-
always based the more persuasive you’ll be tions.
on incomplete In summary, big
and imperfect in leading others and making data and new insights
information. To from fields such as
develop good in- effective marketing behavioral economics
ductive arguments in and neuromarketing will
marketing, you need to recommendations." flood decision makers with
do the following: information (if they haven’t al-
• First, assume the premises ready). Two essential proficiencies
supporting your conclusion required for translating this informa-
are true. Then examine how tion into effective marketing decisions are
strongly your premises support using critical thinking skills and approaching decision
your conclusion. For example, making more like a scientist does. “Applying Scientific
concluding that you should Reasoning” will help you achieve those goals. MM
increase advertising by 10%, because that’s what you
have always done in the past, is not a logically strong
argument. This requirement of making a good argument TERRY GRAPENTINE is principal of Grapentine Company LLC. He is
is called fulfilling the argument’s logic condition. also the author of the new book, Applying Scientific Reasoning to the Field
• Second, assume your argument fulfills the logic condi- of Marketing: Make Better Decisions, from which the ideas in this article
tion—that is, if your premises are true, your conclusion are drawn. Portions reprinted with permission from Business Expert Press,
logically follows. Now, look at the argument’s premises: Copyright 2012. Grapentine may be reached at TGrapentine@gmail.com.

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