Putting beer next to diapers to boost sales

Sixty readers at The Big Read Meet had a spirited debate over the mysteries of decision-making, as detailed in author Michael Lewis' The Undoing Project

Beer and diapers might not seem like things that belong together on a supermarket shelf.

But savvy marketers who want to boost sales of their beer will position it next to diapers in supermarkets, noted Ms Carynn Tey at The Big Read Meet on Wednesday.

"That's because it's usually fathers who get the diapers and, when they see the beer as they're grabbing the diapers, they get that as well," said Ms Tey, 32, an assistant marketing manager at Penguin Books Singapore.

She was among the 60 readers who turned up at the National Library Board headquarters to discuss the mysteries of decision- making, as detailed in American author Michael Lewis' new book, The Undoing Project.

The Big Read Meet is a monthly non-fiction book club run by The Straits Times and the board and moderated by this writer.

In this book, Lewis - whose bestsellers include Liar's Poker (1989), The Big Short (2011) and Flash Boys (2015) - focused on Israeli-American psychologists Daniel Kahneman and Amos Tversky, whose life's work debunked the long and widely held belief among economists that people behaved rationally and predictably when they made decisions.

Kahneman and Tversky showed that people rarely decided anything objectively, but instead were influenced greatly by their biases, as well as when and where they were making their decisions.

The duo were shunned by economists and other established academics for decades because of their work, but Kahneman was vindicated in 2002 when he was awarded the Nobel prize in economics largely for their findings.

Tversky died of cancer in 1996.

Retired business don K. Pelly Periasamy, 69, cautioned against seeing decisions as being either rational or irrational, but rather points on the "continuum" of lifelong learning.

Dr Periasamy, a former assistant dean of the Nanyang Business School here, added: "We judge a decision as being rational or irrational only in retrospect."

Agreeing, German economist and Meet regular Hans Schniewind, 58, said: "We see everything in hindsight. If you go to the casino and win, would you say you've won because you behaved rationally or because you were lucky?"

Dr Periasamy's comments triggered a spirited debate.

Ms Tey thought it important to distinguish between decisions made rationally and irrationally, so that one could go behind what or who were manipulating people to make such decisions.

Former futures trader Lawrence Low, 50, who is self-employed, noted that people were swayed greatly by their personal biases whenever they made decisions.

He cited as an example most people's preference for a decorated war hero, who was vegetarian and hardly smoked or drank, as their country's leader over another candidate who drank and smoked heavily and was a philanderer.

The rub was, Mr Low said, the abstemious vegetarian was Adolf Hitler while the indulgent philanderer was the late British prime minister Winston Churchill.

Then again, Mr Schniewind noted, making snap decisions was an effective way to cope with the pace and complexity of life.

"If you were confronted with many varieties of sausages in a supermarket, you would not ask for the chemical formulation of each before deciding which to buy," he said. Belgian economist and Meet regular Bart Remes, 51, pointed out that no single person could have complete information when making a decision and so, in that sense, "every decision one makes is subjective".

Ms Pearl Lim, 36, who is a marketer for medical devices, said it might be more helpful to see each decision one made as a "narrative" of one's life and experience.

Meet regular Alvin Lee, 58, an engineer and founder of social enterprise Castles Can Fly, wondered how people decide if money and other economic considerations were not an issue.

This moved Mr Gan Jin Yee, 48, an assistant director at the Ministry of Social and Family Development, to cite the example of an artist who made 13 exact copies of a painting and then hung them up for sale.

People bought all of them - at divergent prices.

Noting that objects had no intrinsic value, only that which individuals assigned to them, he cited the example of American violinist Joshua Bell, whose concert tickets went up to US$1,000 a pop - but who got only a few coins when, once disguised as a beggar, he fiddled away in the subway.

•The next Big Read Meet will be on Feb 22.

A version of this article appeared in the print edition of The Straits Times on January 28, 2017, with the headline 'Putting beer next to diapers to boost sales'. Print Edition | Subscribe