Can Buyer Behavior Ever Be Explained?

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“Explanation binds facts together but goes wrong when it increases our impression of understanding,” Naseem Taleb wrote in The Black Swan.

Sometimes we pay homage to explanations just by dint of their having professorial packaging. The Seven Reasons Men Don’t Listen to Women. Quod erat demonstrandum. Puh-leeze! There are an infinity of reasons. Maybe we’re just suckers for bite-sized explanations:

Why salespeople succeed or fail
Why satisfied customers defect
Why customers buy from you
Five reasons why customers want social customer service

Can we accept these explanations when we know the existence of more fundamental unknowns? We don’t yet know what makes us human, how the brain works, or how people decide. We also don’t know the relationship between customer loyalty and profits, how to define Customer Centricity, why consumers value specific brands, or what happens on the buyer’s journey. These are some of marketing’s most intricate issues. Do explanations clarify unknowns, or do they give us pretenses of knowledge and illusions of understanding? As H. L. Mencken wrote, “For every complex problem there is an answer that is clear, simple, and wrong.”

“We are ignorant, and will remain so”, said Emil du Bois-Reymond, a visionary electrophysiologist. Self-deprecation, but we’d all be better off admitting it. That will never happen if advertisers have their way. “The combination of social media analytics with company data predicted customer behavior with up to 90% accuracy in a pilot project . . .” Whoa, Nelly! Through HP’s software, we’re more predictable than previously imagined! Huxley’s Brave New World has arrived!

These days, nurturing healthy skepticism about explanatory power seems as rare as sighting a Livestrong bracelet. In Adobe’s Metrics not Myths video advertisement, an underling digital media consultant gets slapped by his superior when he says “measuring ROI on social media is a myth.” The slapping continues for every statement he makes, as he progresses toward his final acquiescence, “you can definitely measure ROI on social media.” Ahhh, conformity! Now that’s more like it!” It’s a horrible ad.

“Ignorance follows knowledge.” In a May, 2012 interview on NPR’s Diane Rehm show, Columbia University neuroscientist Stuart Firestein said “. . . you know, we all like our ideas so we get invested in them in little ways, and then we get invested in them in big ways, and pretty soon I think you wind up with a bias in the way you look at the data . . . There is an overemphasis on facts and data, even though they can be the most unreliable part of research . . . I think science and medicine has set it up for the public to expect us to expound facts, to know things. And we do know things, but we don’t know them perfectly and we don’t know them forever.”

According to Firestein, “knowledge enables scientists to propose and pursue interesting questions about data that sometimes don’t exist or fully make sense yet. I use that term purposely to be a little provocative. But I don’t mean stupidity. I don’t mean dumb. I don’t mean a callow indifference to facts or data or any of that. Instead, thoughtful ignorance looks at gaps in a community’s understanding and seeks to resolve them.”

I’m convinced. We routinely overestimate what we know, without considering that uncertainty and randomness are extraordinarily consequential. Predictive models don’t accommodate every variable or recognize every contingency. My most thoughtful, reasoned sales forecasts could never have anticipated e coli invading the food supply chain, or more recently, Hurricane Sandy.

I’d still like to know what motivates a purchase decision, why superior products aren’t consistently commercially successful, how social networks influence consumers, and how people gather and use information. I’d also like to know how people perceive value, exactly what thwarts a buying process, and why two salespeople with similar skills, motivation and experience can produce wildly different results.

I’ll keep reading and listening for explanations. As Taleb wrote, “Things work out best when you know where your ignorance lies.”

Republished with author's permission from original post.

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