Decoded: The Science Behind Why We Buy

A book review, originally posted on my old blog in 2014

I have just finished reading a great book by Phil Barden called Decoded. The book shows us how branding works in order to influence our purchase decisions.

“Strong brands have a real effect in the brain, and this effect is to enable intuitive and rapid decision making without thinking” — Phil Barden

The main foundation of the book is based on the work of Daniel Kahneman. Kahneman won a Nobel Prize in 2002 for showing that people are not the rational agents that economists once thought they are. In his book, Thinking, Fast and Slow, Kahneman states that the mind incorporates two systems: an intuitive “system one”, which makes many decisions automatically, and a calculating but lazy “system two”, which rationalizes system one’s ideas and sometimes overrules them.

Figure taken from Phil Barden’s book, Decoded

Back to Phil Barden and his book Decoded. He incorporated the ideas of Kahneman into the field of marketing saying:

“There are two decision-making systems at work in any decision we make: an implicit system working like an autopilot, and an explicit system”.

Thus, when we make a purchase decision we are under the influence of both System 1 (Autopilot) and System 2 (Pilot).

The explicit pilot system is a rational one and rule-governed. So you may argue, why do we base our decision on the implicit autopilot system which is irrational. The point is that the autopilot system is fast and can process multiple pieces of information in parallel, and above all, it is effortless and doesn’t consume much of our energy, as opposed to the implicit system. Thus, in our day-to-day tasks we cannot make use of the the explicit system all the time.

You may think of implicit autopilot system as our intuition, it is what helps us to turn the steering wheel in a fraction of a second when we face some dangerous situation while driving. It is also the one that is trained that the red color means stopping or rejection and the green color means proceeding or acceptance, and that’s why when our mobile phones ring, we press on the answer button based on its color…