Weblogsky: Predictably Irrational

Predictably Irrational

I haven't read Dan Ariely's Predictably Irrational: The Hidden Forces That Shape Our Decisions, but I sat in on an hour-plus phone interview Brian Massey led with Dan last night at a Bootstrap Web meeting, and I was impressed by his insight, based no diligent research into into irrational thinking and its impact on our behavior and decisions. Decison-making is difficult and complex, and it's worth studying how we decide what we want, which always happens in context. We make relative comparisions. He mentioned how Olympic Bronze medal winners are happier than Silver medal winners, because the silver winners are thinking, "damn, a little better and I could've had the gold," whereas bronze winners are thinking "wow, a little worse and I would've had zilch." He also discussed how Starbuck's created an experience that differentiated them from Dunkin Donuts, though both derive significant revenues from beverage sales. He also noted Dunkin Donuts' advantage in sales: their coffee drinks are really mostly coffee, where as Starbucks' coffee drinks are mostly milk, which is more expensive.

Dan has many snippets of insight as videos on his site (via YouTube). Here's an example, on relativity: