Threshold thinking in marketing!

There is an interesting story circulating on Wall Street: The San Francisco Chronicle held a stock selection contest. The first group of five stocks was selected by eight well-known economists, while the second group of five stocks was selected by a gorilla throwing darts at a cardboard with stock codes. In the end, the rate of return of the stock portfolio was calculated, and the gorilla's stocks won over the economists (1)...

This anecdote not only proves that the saying "It's better to trust XX animals than XX people" is applicable all over the world, but also mocks the economists who have a lot of knowledge and data but are useless when they come into play.

1. Are you throwing darts too?

Of course, economists are not the only ones in the world who make money from making inaccurate predictions. There is another group of people who are full of confidence and passion when presenting proposals during the day, using harsh words - deep insights, sharp creativity, accurate big data, strong media resources... It seems that this project has perfectly integrated science and art, and the boss is just waiting for the product to sell well and make money; but in the dead of night, they toss and turn, thinking in their hearts whether to forward the colorful koi or worship various gods before the project is implemented...

That’s right, they are you and me, miserable and guilty marketers.

It is tragic because a marketer’s career is about constantly making decisions and betting. As the last link in the company, all mistakes can be attributed to marketing. It is guilty because many marketing managers feel that whether a project promotion can be successful is a completely metaphysical issue, and they do every step blindly.

Apart from those wonderful cases packaged for awards, when new marketing people asked him how to ensure the success of a project, most of them were vague or they finally spit out two words after a long time - experience.

Yes, marketing managers dare not admit it, but the decision-making and success of many marketing projects are actually no different from a gorilla throwing darts.

2. Threshold Thinking Remakes the Target

If marketing budget and market opportunities are the darts in your hands, and throwing techniques are your business level, then threshold thinking can be regarded as the division and drawing of target scores. The reason for saying this is that threshold thinking is the most practical yet most easily overlooked underlying logic in marketing . The so-called underlying logic (first principles) (2) is the [most basic common sense] that everyone agrees on and does not need to be proven. For example, in geometry, “the straight line is the shortest distance between two points”, people do not need to prove its correctness to others, they can just use it directly.

Threshold thinking belongs to this type of underlying logic. Threshold means limit, so the threshold is also called critical value, which refers to the lowest or highest value that an effect can produce. Thresholds are widely used in all aspects of your life, including chemistry, biology, architecture, electricity, psychology, etc. The boiling and ignition points of objects involve thresholds, as do the hearing ranges of organisms. In motivational literature, the transition from quantitative change to qualitative change still involves thresholds... In marketing, whether each link can be activated and produce an effect also depends on thresholds.

To exaggerate a little, everything has a threshold! Just like the scores marked on a target board.

3. Can learning threshold thinking ensure the accuracy of marketing?

Since we have talked about threshold thinking, I guess you must have an expectation in your heart - just waiting for me to tell you what the threshold data for success in each link of marketing are, such as to what extent the creativity of an advertisement or TVC can break the circle; how much money should be spent to hire an anchor for an e-commerce live broadcast to have the highest return rate; or even how many words in the title of an article can ensure 100,000+... Unfortunately, I don’t have any of these threshold data. Not only me, even if you ask all the marketing masters, it is difficult to get an accurate and fixed answer, because the market and competition are inherently dynamic, interactive and irrational. It is impossible for them to remain unchanged for thousands of years like the boiling point of water.

So, in the face of the current situation where threshold data is not fixed, does threshold thinking still have practical value?

First of all, we need to reach a consensus - to understand the value of the thinking model, please think of it as a principle and law, rather than a set of fixed equations that can get results by inputting numerical values.

Secondly, I cannot provide a precise threshold for the success of each marketing action because different fields and forms have their own individual uniqueness, but that does not mean that you cannot continue to explore, optimize, and approach the marketing threshold of your market.

Finally, the most valuable function of threshold thinking is to help you open your mind to a God’s perspective in marketing activities, so that you can think and make decisions more calmly and comprehensively.

4. New discoveries from a God’s perspective

1. Digitalization of marketing thinking

In recent years, many marketers have deeply felt that their position in the workplace is precarious and they are far less popular than operations managers and growth hackers. Ultimately, it is because marketers’ thinking is too “advertising creative”. All decisions and judgments seem to be driven by emotion and experience, and are hardly supported by theory and data. Once challenged, they will be panicked inside.

If you have threshold thinking, it will be much easier to use data-driven thinking in decision making. Let’s use the boiling of water as an analogy. Suppose, a video ad that can be seen by 100,000 people (consciously) is considered a marketing success, just like water at 100℃ will boil. Then, in order to ensure boiling, you will be able to perceive the changes caused by various constraints more clearly and in a digitized way. For example, how many grams of charcoal need to be burned to release heat (the advertising information covers the population) to make the water boil, how many degrees of electricity are needed if the same amount of heat is converted into electricity (information channel selection), what material of kettle will have less heat loss when boiling water (information form), at what atmospheric pressure will water boil faster (information eye-catching intensity), etc.

Once you remember that everything has a threshold, you will naturally start the data quantification mode, and you will know the potential of each constraint, what the influencing variables are, and how to set up AB tests to accurately quantify them... Gradually, this information will be digitized in your mind, and then through continuous optimization and adjustment, it will be refined to a higher level of accuracy, and finally become your logical, data-based, shareable, and replicable practical experience.

2. Have a holistic view of marketing

Once you have the threshold thinking of marketing, your perspective on the project will naturally be elevated. You will no longer just focus on a certain line or a certain constraint. It will also be easier to understand that each project is a combination of collaboration under the influence of multiple conditions.

For example: if the budget (the calories provided) is limited, can we spend more time on creativity to make up for it, rather than using a 50-point budget to come up with 50-point creativity? For example: if a new brand is launched (the calorie conversion rate is limited), can we not be so ambitious, narrow the audience group, and focus on winning the most matching seed users, so as to stimulate a big impact in a small market area, and throw stones into the water tank instead of throwing them in the pond...

In this way, you can have a bird's eye view of the entire project and understand why your supervisor or boss allows some unsatisfactory results to occur. As the saying goes, if you lack talent, you can make up for it with hard work. If a marketing project lacks insight, it can be supplemented not only by creativity, but also by media channels, anchor experts, and even distribution channels and promotional prices... The boss knows more clearly the threshold to ensure the qualification of the project. As long as the total threshold can be reached, adjusting any constraint that affects the threshold will no longer be the only or important factor.

If you want to develop a better global perspective, in addition to awakening threshold thinking, MECE (3) in the pyramid principle is also a good tool.

Similarly, when you analyze other cases or review situations with threshold thinking, you will also be able to understand the effects of the mutual influence of various conditions more comprehensively and more focused, rather than just complaining about whether the creative copywriting is awesome or stupid.

3. Patience for short-term ineffective investments

If you understand threshold thinking, you will not only understand why a match is not enough to boil a pot of water, but also be able to explain to your boss in a logical and logical way why social distribution cannot make a return on investment immediately. More importantly, you will be able to deal with the anxiety and entanglement when (short-term investment has no effect) more calmly. In fact, for many projects, everything goes well, but they are often ruined because the water in the pot only heats to 60℃. Although it is hot to the touch, it is still a little short of boiling. This is the most challenging moment: whether to persist in investing or give up stop loss. Those who lack patience or a sense of threshold often find it difficult to resist the uneasiness in their hearts and give up hastily.

Think about it again, when you are doing the final review, how many marketers are only willing to report the meaningless vanity index (4) or point out small insignificant problems, but dare not or even unconsciously think about whether this project has really "boiled the water" or "abandoned halfway"? If the propagation threshold is not reached this time (the water does not boil), what improvement plans are there next time to allow the project to approach the threshold more effectively?

5. Using threshold thinking to solve the puzzle of (50% advertising waste)

After spending a lot of energy and words to explain why threshold thinking is the most practical basic thinking, the next step is to try how threshold thinking can help you re-recognize and solve marketing problems. Generally speaking, the thinking logic of threshold thinking can be divided into four steps.

• First, select a target.

In B2C brand promotion, the ultimate target of most brands must be individual consumers, and the purpose of the brand is to act on the minds of consumers and inspire them to take action. Then the target that must be selected and examined must be the consumers.

• Next, set the initial threshold

Brands in different product categories have different thresholds to inspire consumers to take purchasing actions. When you are not sure about the specific threshold, you can make an assumption first. For example, if the brand's information can effectively reach consumers 7 times, it will stimulate purchasing behavior.

• Afterwards, the key elements and interference conditions in the marketing value chain (5) are analyzed.

The process from the generation of brand information to its effective reception by consumers is not a smooth straight line. Information will be transmitted through different channels, will be lost in different media forms, and will encounter interference from various noises. So, try to outline the value chain of information delivery in the marketing projects you implement, which will make the various elements and constraints more intuitive. Simply put, strategic insight—creative expression—presentation form—media channel—consumer can be seen as a simplified version of the value chain. (The “Multiplication Thinking Model” will introduce in detail how to draw the value chain)

• Finally, the statistical threshold reaches the ratio.

Based on the effectiveness of different value chain conversions, we can calculate how large a range (number of consumers) the marketing project can ultimately reach effectively, and roughly what proportion of target consumers can reach the action threshold. Next, practice.

I know that half of advertising is wasted, the bad thing is I don’t know which half! (6)

I believe that marketers are no strangers to this sentence. Before, you may have regarded it as a complaint or a metaphysical mystery. This time, let’s try to solve it using threshold thinking.

At the target selection level: Is the 50% waste due to the lack of accuracy in the screening of target consumers? For example, in the sanitary napkin advertisements on TV, it can be asserted that the waste among the covered population (gender) exceeds 50%?

In setting the initial threshold: we still assume that the initial consumer action threshold is 7 effective touches, but here we must remind you that if there is a 50% waste, it does not mean that the number of marketing touches is only 7 × 50% = 3.5 times. Instead, it is based on a conversion screening rate. For example, the brand must be effectively reached 9 times to awaken action, but among the target consumer group whose reach exceeds the set threshold (7+), only 50% of them have achieved 9 reaches.

At the value chain analysis level: In the calculation of marketing information dissemination, is the consumer's ability to automatically block advertisements fully considered? Consumers today are bombarded with advertisements all the time, and their brains have long been accustomed to turning a blind eye, just like the famous psychologist's blind gorilla experiment (7). Therefore, it is very likely that your marketing information has been subconsciously blocked by the brain X times. Only after X times will consumers gradually realize that they have seen your advertisement, and only after continued accumulation of information will they take action.

Also, have you ever thought about how much of your marketing message is designed to counteract the distracting noise (8) created by your competitors? It's like being in a noisy farmers' market. The decibel level of your hawking should not be simply calculated based on the threshold that customers can hear. Instead, you have to hawk louder than your competitors' noise in order to be heard. Then this part of the waste of consumption is bound to happen. It's like a person feels full after eating two burgers and a bag of French fries. It cannot be said that the bag of French fries is what really makes him full and the burgers are wasted.

Of course, at the value chain level, we can also examine whether the combination of our information presentation type and media form has internal friction and is inconsistent with user habits. For example, in a 15-second elevator video advertisement, you leave a QR code in the last 2 seconds and expect consumers to scan the code to download it? Do you think consumers will hold up their cameras and wait for your brand’s QR code like paparazzi taking pictures of celebrities?

Finally, the statistical threshold reaches the proportional stage. Has every marketing value chain reached the threshold? Is there a situation where the investment is not enough and the water is not boiled, so the process is abandoned halfway? Is it because we are not allocating enough resources, or are we too greedy and stretching the marketing front too long? You see, if we use threshold thinking and think in reverse, we can find many nodes of potential problems. With these analyses, the puzzle of whether 50% of advertising is wasted is no longer confusing and unsolvable.

6. Marketing Application of Psychological Thresholds

The research and analysis of thresholds is no longer limited to the stereotyped cognitive level of the “three-strike theory” (9). In psychology, there are two very important sub-concepts about thresholds that are worth your in-depth study.

1. Absolute perception threshold:
The smallest stimulus that can be perceived is often called the absolute threshold

The extended application in the field of marketing can be, for example, what is the shortest length of time people can recognize a message. If it is 3 seconds, then a 15-second video ad can broadcast 5 repeated messages, which is equivalent to 1 for 5, thus quickly reaching the consumer's memory threshold. This is why so many brands choose simple and crude brainwashing ads!

However, if the information is 1 second long, the consumer’s absolute perception threshold may not be able to detect and recognize the information. The consumer may have already taken action on the 7th time, but continuing to watch will cause negative effects of disgust (eating two pieces of fried chicken is happiness, eating two pounds of fried chicken is torture).

2. Difference sensory threshold:
The minimum difference in the amount of stimulus that can just cause a difference in sensation

The difference perception threshold is more suitable for use in marketing competition tactics. As mentioned above, in a noisy vegetable market, how high do you need to raise the decibel level so that consumers can hear your message clearly among the shouts of many competitors? Similarly, on the shelves of supermarket terminals, why do Uni-President, Master Kong, and Jinmailang brands all insist on using purple packaging designs for the packaging of Laotan Pickled Cabbage Beef Noodles instant noodles?

In fact, it is to use the difference sensory threshold for terminal interception. Consumers may see an advertisement for Uni-President’s sauerkraut noodles on TV, but when facing a row of twin brothers on the shelf, they will remember that they are seeing the Master Kong brand and then put Master Kong into the shopping cart.

7. Threshold thinking brings new marketing opportunities

As the underlying logic, when you realize the practicality of threshold thinking, it will be easy to find more practical cases and to examine and understand marketing behavior from another new perspective. Due to space limitations, I will not discuss each one in detail, but will raise a few questions here. You are welcome to think and discuss.

Q1: Why do some people say that in 2016, Toutiao’s marketing promotion, graphic design and copywriting failed, but the advertising was successful.

Q2: How to use threshold thinking to guide the selection of brand spokespersons/close friends?

Q3: From the perspective of threshold thinking, what problems does H&H’s super symbol help brands solve?

Author: Uncle Talks Marketing

Source: Uncle Talks Marketing

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