3.6: Creativity as Costly Signalling
If you can’t afford to pour money into the paper or the printing of your wedding invitation, you can use another scarce commodity that I’ll call ‘creativity’, although it encompasses a variety of talents: design, artistry, craftsmanship, beauty, photographic talent, humour, musicality or even mischievous bravery. A handmade birthday card can be cheaper and yet still more moving than an expensive bought one – but it has to involve a level of effort.* A video recording of a self-composed song as a wedding invitation could, with enough talent and tolerable production values, be sent by email, but a straightforward and factual unfunny email invitation just isn’t the same – it has no creativity and is just a statement of fact.
The meaning in these things derives from the consumption of some costly resource – which, if not money, may be talent, or effort, or time or skill or humour or, in the case of risqué humour, bravery.* But it has to contain something costly, otherwise it is just noise.
Illustration by Greg Stevenson
Bravery and wit can be a form of costly signalling.
Effective communication will always require some degree of irrationality in its creation because if it’s perfectly rational it becomes, like water, entirely lacking in flavour. This explains why working with an advertising agency can be frustrating: it is difficult to produce good advertising, but good advertising is only good because it is difficult to produce. The potency and meaningfulness of communication is in direct proportion to the costliness of its creation – the amount of pain, effort, talent (or failing that, expensive celebrities or pricey TV airtime) consumed in its creation and distribution. This may be inefficient – but it’s what makes it work.
Quite simply, all powerful messages must contain an element of absurdity, illogicality, costliness, disproportion, inefficiency, scarcity, difficulty or extravagance – because rational behaviour and talk, for all their strengths, convey no meaning. When Nike chose to use Colin Kaepernick, the American football player who had instigated the practice of kneeling rather than standing for the US national anthem before games, as the figurehead for their 2018 campaign, it was an example of a kind of costliness through bravery. He was not an expensive choice – his career was in limbo – but he was a brave one, since he was so closely identified with the NFL protests against police brutality. As this campaign demonstrated, meaning is conveyed by the things we do that are not in our own short-term self-interest – by the costs that we incur and the risks we take.
One of the most important ideas in this book is that it is only by deviating from a narrow, short-term self-interest that we can generate anything more than cheap talk. It is therefore impossible to generate trust, affection, respect, reputation, status, loyalty, generosity or sexual opportunity by simply pursuing the dictates of rational economic theory. If rationality were valuable in evolutionary terms, accountants would be sexy. Male strippers dress as firemen, not accountants; bravery is sexy, but rationality isn’t. Can this theory be extended further? For instance, is poetry more moving than prose because it is more difficult to write?* And is music more emotionally potent than normal speech because it is more difficult to sing than to talk?*
3.7: Advertising Does Not Always Look Like Advertising: The Chairs on the Pavement
A few years ago, a coffee shop opened on a fairly busy road a mile or so from my house. There were about twenty seats inside, and a few benches on the pavement outside. It wasn’t a bad coffee shop, but in time it failed. Some new people took over, following what seemed to be an identical formula, but they failed too.
The third owners to take over the premises therefore seemed overconfident in trying the same formula, yet they miraculously created a successful business. The food and the prices did not seem to be any different from that of their predecessors. In fact the only thing they changed seemed trivial: they bought more attractive chairs and tables, and placed them outside at the start of the day, as well as a waist-level gauze fence which surrounded the chairs, making a kind of terrace. This was less efficient than the old benches, since this moveable (and therefore thievable) furniture had to be stored away at the end of each day, and replaced every morning.
However, I think it was precisely this change that was the reason for the new shop’s success. I mentioned that the café was on a busy road – in fact, to anyone concentrating on their driving, its existence wouldn’t have been immediately obvious. Even if you did spot the sign saying ‘coffee’, it was far from clear, when no one was sitting outside, whether the coffee shop was open – you could have spent five minutes finding a parking space only to find it was closed.* The old benches that permanently sat outside were meaningless as an indicator of whether the shop was open. By contrast, the new chairs and the fence, which might have been stolen or have blown away if left unattended, were a guarantee that the shop was open – no one who had closed their shop would have gone home and left them in the street.
‘Oh, come on,’ I hear you say. ‘This is all very well in theory, but nobody driving down an A-road consciously calculates the probability that a café is open by assessing the portability of the furniture outside.’ In one sense you are right, but they don’t do it consciously – they do it instinctively. And to make such calculations we use mental processes, which take place beyond the reach of conscious awareness. We draw unconscious inferences from environmental cues everywhere we go, without having the slightest awareness that we are doing so – it is thinking without thinking that we are thinking.
These mental processes are psycho-logical rather than conventionally logical, and rely on a different set of rules to those we adopt when we use conscious reasoning, but they are not necessarily irrational, given the conditions under which our brains have evolved. Our brains did not evolve to make perfect decisions using mathematical precision – there wasn’t much call for this kind of thing on the African savannah. Instead we have developed the ability to arrive at pretty good, non-catastrophic decisions based on limited, non-numerical information, some of which may be deceptive. Far from being irrational, the inferences we are able to draw just from seeing chairs outside a café are surprisingly clever, once you uncover the reasoning behind them.
A sign that said ‘Open’ could be a meaningless claim, because someone could simply have forgotten to turn the sign to ‘Closed’ – and in any case it would be hard to read from a car. A neon sign that said ‘Open’ would be a more reliable indicator, since someone leaving the shop would probably switch it off to save electricity.* But light, stackable chairs behind a windbreak – now that’s a signal you can trust. In other words, the chairs act as an effective advertisement; the cost of their purchase and the daily effort entailed in arraying them outside the business and restacking them at the end of the day is a reliable signal of the existence of a functioning coffee shop, and one that is tacitly understood rather than consciously processed by human reason. Having worked in advertising for over 25 years, usually for large companies with big budgets, it still fascinates me how great an effect unconscious signalling can have on the fortunes of a tiny business. And more than that, it frightens me to think how many perfectly worthwhile businesses have failed that might not have done if they’d implemented a few trivial signals.*
Relatively small businesses that might not be able to afford to advertise in any conventional sense, could transform their fortunes by paying a little attention to the workings of psycho-logic. The trick involves simply understanding the wider behavioural system within which they operate. Cafés could boost sales by improving their menu design. Many small shops are inadequately lit, and so passers-by assume they are closed – how much business do they lose as a result?* Pubs are often needlessly intimidating because their windows are made of frosted glass, preventing people from looking inside before entering. Pizza delivery firms could differentiate themselves in a crowded market by agreeing to deliver tea, coffee, milk and toilet paper alongside a pizza. Restaurants might increase sales by allowi
ng the kerbside collection of take-away meals – or by adding a sign which says ‘parking at rear’.*
In the unlikely event that either of the failing cafés had decided to appoint a management consultancy to solve their business woes, I doubt anyone would have suggested changing the furniture; doubtless they would have received a long list of recommendations covering all the left-brain facets of the business – pricing, stock control, staffing levels and so forth. Anything that could be included on a spreadsheet would be analysed, quantified and optimised, in order to increase efficiency. But no one would have mentioned the chairs.*
I will now take my idea one step further. Not only would we reliably infer from the presence of tables and chairs that the café is open, I also believe we go deeper still – I think we subliminally deduce that any place that goes to the trouble of erecting chairs on the street will serve coffee that, at the very least, is unlikely to be terrible. That seems a silly use of mental energy – surely the way to determine whether the coffee is good is to buy one and find out?
‘I knew the coffee was going to be good because of the chairs,’ sounds like a very silly sentence, but hold on a moment – maybe, using psycho-logic and a bit of social intelligence, we can identify a connection. For a start, someone who invests in new chairs and goes to the trouble of placing them on the pavement every day is not lazy, and has also invested in their business. Furthermore, they seem to expect their business to be a success – had they not, they would not have undertaken the expense. The chairs don’t promise perfection, but they are a reliable indicator of at least reasonable quality. The business owner who buys the windbreak and the chairs has probably also invested in a decent Gaggia machine, proper milk and coffee beans – and in training his staff. It suggests the owner, rather than playing the short game of immediate profit maximisation, is playing the long game, building a reputation and a loyal customer base – which will mean a cappuccino that is palatable at the very least.
Of course, you might have to be careful not to overdo this kind of signalling. Putting expensive armchairs outside might lead people – not unreasonably – to conclude that the establishment is also expensive. This question is a significant dilemma in supermarket design: the main factor which influences human price perception in shops is not, bizarrely, the actual prices charged, but the degree of opulence with which the store is fitted out.
If this emphasis on advertising seems excessive and self-serving, I sympathise – in fact, I thought this myself. However, it all depends how you define advertising; in nature, it is often necessary for something to present a persuasive message, and in a way that can’t be faked. Information is free, but sincerity is not, and it isn’t only humans who attach significance to messages in proportion to the costliness of their creation and transmission; bees also do it.*
3.8: Bees Do It
When signalling their enthusiasm for a potential nesting site, bees waggle about in an exponential relationship to its quality; the amount of energy they expend in the signalling of a potential nest site is proportional to their enthusiasm for it. But they also make use of expensive ‘advertising’, in order to decide where to devote their time and attention.
The advertisements which bees find useful are flowers – and if you think about it, a flower is simply a weed with an advertising budget.
Flowers spend a great deal of their resources convincing customers that they are worth visiting. Their target audience is bees, or other insects, birds or animals that may help to pollinate the flower – a process that dates back at least to the time of the dinosaurs.* For the pollination process to be effective, the flower needs to convince the customers of its worth. To borrow the language of the Michelin Guide, a flower can be ‘vaut l’étape’, ‘vaut le détour’ or ‘vaut le voyage’; ‘worth stopping at’, ‘worth going out of your way for’ or ‘a destination in itself’. To do this, the flower places a costly bet, offering a generous source of nectar that rewards bees for their visit, and encourages them to stay at the flower for long enough to collect pollen on their bodies for dispersal elsewhere. But this nectar is kept out of sight – how can the flower, at a distance, convince the bee of the existence of a reward which it cannot verify until it has already exerted time and effort?*
The answer is that they use ‘advertising and branding’ – they produce distinctive, hard-to-copy scents and large, brightly coloured petals. These are noticeable, but producing them is risky, as they may attract the attention of herbivores that might eat them. The distinctive scent and petals act as a reliable (though not infallible) proxy for the presence of nectar, which a bee can use to help decide whether the visit is worth it or not.
A plant which has sufficient resources to produce petals and scent is clearly healthy enough to produce nectar, but using its resources for distinctive display will only really pay off if bees visit more than once, or if they encourage other bees to join them – there is no point in advertising heavily up front if you only make one sale. When you come here, the display says, I’m betting that you’re going to come back, or all my effort will have been wasted.
The system of information-sharing between the two species is also reliable – there is often a correlation between the size of petals and the supply of nectar. This saves a lot of wasted visits, because it means that a bee can tell from some distance away whether a plant is ‘a destination in itself’. It also requires that the plant use their resources on being distinctive as well as noticeable. If any type of flower is a better source of nectar, this generosity will only be rewarded with ‘customer loyalty’ if bees can learn to recognise it and so choose to make repeat visits. If all flowers looked and smelled alike, any incentive they offered to the bee – more nectar, perhaps – would be ineffective, because the bee might not be able to distinguish between that kind of flower and other less rewarding plants. It is only by having a recognisable identity that a flower is able to improve the value exchange* and increase the chance of repeat visits.
I have used marketing jargon here, because what flowers need to establish in the minds of bees is, effectively, a brand. Why don’t flowers cheat, by devising an alluring advertisement of huge petals, and then delivering no costly nectar? Well, sometimes they do – false advertising is common in orchids, which often seem to be the scam artists of the plant kingdom. At least one orchid species mimics the appearance (and smell) of female insect genitalia; many mimic food sources and some mimic other plants. But this can only work on a small scale* – play that trick too often and insects will just learn to avoid you.
To put it another way, if there is the possibility of bees either refusing to return to a plant, or encouraging a wider boycott among their fellow bees, the resources spent on advertising through scent and colouration is an unrewarded cost. However, orchids are the tourist restaurants of the floral world – they rely on people visiting only once so are less worried about ripping off visitors, because they know they are never going to come back anyway. However, if there is a prospect of repeat visits or of positive reputational gains spreading among your prospective clientele,* it pays not to cheat. This mechanism isn’t perfect: as with humans, it only works well where there is the prospect of a regular repetition of exchange or a mechanism for reputational sharing. In categories where we only buy infrequently* and where we don’t talk to each other about our satisfaction, it will break down.
Economists tend to dislike the idea of branding and are inclined to see it as an inefficiency, but then they might view a flower as an inefficient form of weed. The reason they might not understand the flower’s extravagance in squandering its resources on producing scent and colour is that they don’t fully understand what it is trying to do or the decision-making and information-transfer context in which it is trying to do it.
It is not any more irrational for human consumers to pay a premium for heavily advertised products than it is for bees to prefer to visit heavily ‘advertised’ flowers. It seems unlikely that a company would spend scarc
e resources advertising a product they believed to be bad – it would simply lead to the unpopularity of a bad product spreading more quickly. Moreover, a company with a long-established reputation for high-quality products has much more to lose from customer disappointment than a company with no reputation. To quote a Caribbean proverb, ‘Trust grows at the speed of a coconut tree and falls at the speed of a coconut.’ As with bees, this mechanism works because we are able to punish cheats: either an individual can never revisit, or a group can collectively boycott the brand through negative word of mouth (or in bees, though word of waggle dance).*
In advertising, a large budget does not prove a product is good, but it does establish that the advertiser is confident enough in the future popularity of the product to spend some of his resources promoting it. Since at the moment you make a purchase decision, the advertiser knows more about his product than you do, a costly demonstration of faith by the seller may well be the most reliable indicator of whether something is at least worthy of consideration (remember the Knowledge with London taxi drivers). It also proves that the seller is in sufficient financial health to advertise in the first place. However, for this to work, you need stable distinctive identities, as well as laws to prevent manufacturers pretending their goods are those of someone else (this is called ‘passing off’ in commerce; in biology it is known as ‘Batesian mimicry’).*
Reproduced with permission from Augie
Batesian mimicry in action.
3.9: Costly Signalling and Sexual Selection
Costly signalling theory, which was first proposed by the evolutionary biologist Amotz Zahavi, is, I believe, one of the most important theories in the social sciences.* The idea of signalling and its role in sexual selection is necessary to explain many evolutionary outcomes, but it didn’t always seem that way, not even to Charles Darwin. In a letter to a friend, Darwin remarked that ‘the sight of a feather in a peacock’s tail’ made him ‘physically sick’. The reason for this strange aversion was that the male peacock seemed a living refutation of the theory of evolution through natural selection – the idea that something so beautiful and yet so ostensibly pointless sat more easily with the idea of a divine creator than with the idea of natural selection. After all, a decorative tail in no way enhances fitness or survival and rather makes the peacock conspicuous to predators, and is an encumbrance when it needs to evade them. The ability to lurk unobtrusively in the shadows is an advantage both to predators and prey, but being highly visible seems to be a disadvantage to both.
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