Roman Mars of 99% Invisible recently published an excellent episode called The Mind of an Architect. It has to do with a set of research studies completed in the late 1950s by an organization at the University of California, Berkeley known as the Institute of Personality Assessment and Research (IPAR).
IPAR was founded by a personality psychologist named Donald MacKinnon. He initially worked for the precursor to the CIA and founded IPAR with the intent of studying “combat readiness and efficiency.” But over fears of how creative the Soviets were getting, the focus of IPAR shifted to instead studying creativity.
And architects were deemed to be an ideal test subject (from 99percentinvisible.org):
“Researchers saw architects as people working at a crossroads of creative disciplines, a combination of analytic and artistic creativity. As professionals, architects had to be savvy as engineers and businessmen; as aesthetes, they also acted as designers and artists.”
So over a series of weekends in the late 1950s, some of the most celebrated minds in architecture – including people like Philip Johnson, Richard Neutra, and Louis Kahn – were studied and picked apart.
They were asked to do quick sketches, create mosaics, and they were asked questions such as this one: “For the next 45 minutes we would like you to discuss this notion: if man had developed a third arm, where might this arm be best attached?”
In the end, here’s what they concluded:
The researchers began to notice certain patterns across creatives of all professions and genders, including a tendency to nonconformity and high personal aspirations. They also found many creatives shared a preference for complexity and ambiguity over simplicity and order. Creatives could make unexpected connections and see patterns in daily life, even those lacking high intelligence or good grades.
In short: IPAR found that creative people tend to be nonconforming, interesting, interested, independent, courageous and self-centered, at least in general. Many of these traits may seem obvious today, but they were not necessarily obvious prior to these studies. Back when their tests were being conducted and findings presented in the 1950s and ’60s, the very idea of a “creative personality” was a novelty in academic and public discourse.
The findings may not be groundbreaking to us today, but the documents and recordings produced during the study are certainly interesting. If you’re into this topic, there’s also this book you can pick up.
Oh, and if we are to have a third arm, I would like mine to run almost parallel to my existing dominant arm (right). That way I could double up on my most potent dexterity. It would also be far less intrusive than an arm on one’s head or in the middle of one’s back. Then again, it would ruin our symmetry as humans. And perhaps that third arms need to be celebrated instead of being masked.
What would you suggest?
Image: Institute of Personality and Social Research, University of California, Berkeley / The Monacelli Press (via 99% Invisible)
I just read an interesting chapter from Tim Smith’s book, "Pricing Strategy: Setting Price Levels, Managing Price Discounts and Establishing Price Structures." It’s Chapter 5: Psychological Influences on Price Sensitivity.
The chapter covers a number of pricing phenomenons, such as why prices ending in .99 tend to convey a discount and why whole prices ending in 0 tend to speak more to quality. It’s for this reason that art work is typically priced using simple round numbers.
But one of most interesting theories from the chapter is that of Prospect Theory. Not only because of its impact on pricing strategies, but because, I think, it also applies to the real estate development business.
Prospect Theory essentially describes the way people make decisions in the face of uncertainty. The two big takeaways for me are (1) that potential losses carry more weight than potential gains and (2) that both losses and gains experience diminishing returns.
What this effectively means is that people, when faced with risk, tend to focus more on the negatives, and the potential losses, than on the positives. This means that the gains just can’t match the losses, they have to be significantly greater if you’re going to inspire action (a purchasing decision, a change in behaviour, or whatever).
The second point basically means that these gains and losses become muted after a certain point. If you hit someone with enough of either, eventually they reach a point where they become desensitized in a way. Each additional amount of gain or loss produces less and less impact.
Besides the obvious point of making sure that your product or service results in lots of gain for your customer, there are a couple of other things you can do to respond to this theory.
The first is to “bundle losses” and “unbundle gains”. In other words, hit people with all the losses at once and then spread out the gains. What this does is maximize the psychological perception of gains and minimize the perception of losses because, remember, after a while people start to discount the losses.
The other thing you can do is transfer losses, which is often just the cost itself, from direct to indirect. Big box stores, as an example, are great at this. They offer low prices (a direct cost) in exchange for greater indirect costs: higher transportation costs to the user, greater environmental impact, and so on. Studies show that people feel direct costs much more than indirect costs.
There are a bunch of things you can do based on this theory, but again, one of the most fascinating things for me was how it also applies to the real estate industry. There’s a well known acronym in the industry called NIMBY. It stands for Not In My Back Yard, and it’s used pejoratively to refer to people who oppose development in their community.
However, if you look at NIMBY’ism through the lens of Prospect Theory, you realize that it’s almost an innate human reaction. Development and construction is disruptive and the end result is change in somebody’s community. And I suspect that most residents view it as a risky and uncertain situation. Therefore, it’s no wonder that they’re first reaction is opposition. They’re weighing the potential losses more than the potential gains.
So maybe we developers just need to apply a little Prospect Theory. We need to get better at producing and communicating gains.
Roman Mars of 99% Invisible recently published an excellent episode called The Mind of an Architect. It has to do with a set of research studies completed in the late 1950s by an organization at the University of California, Berkeley known as the Institute of Personality Assessment and Research (IPAR).
IPAR was founded by a personality psychologist named Donald MacKinnon. He initially worked for the precursor to the CIA and founded IPAR with the intent of studying “combat readiness and efficiency.” But over fears of how creative the Soviets were getting, the focus of IPAR shifted to instead studying creativity.
And architects were deemed to be an ideal test subject (from 99percentinvisible.org):
“Researchers saw architects as people working at a crossroads of creative disciplines, a combination of analytic and artistic creativity. As professionals, architects had to be savvy as engineers and businessmen; as aesthetes, they also acted as designers and artists.”
So over a series of weekends in the late 1950s, some of the most celebrated minds in architecture – including people like Philip Johnson, Richard Neutra, and Louis Kahn – were studied and picked apart.
They were asked to do quick sketches, create mosaics, and they were asked questions such as this one: “For the next 45 minutes we would like you to discuss this notion: if man had developed a third arm, where might this arm be best attached?”
In the end, here’s what they concluded:
The researchers began to notice certain patterns across creatives of all professions and genders, including a tendency to nonconformity and high personal aspirations. They also found many creatives shared a preference for complexity and ambiguity over simplicity and order. Creatives could make unexpected connections and see patterns in daily life, even those lacking high intelligence or good grades.
In short: IPAR found that creative people tend to be nonconforming, interesting, interested, independent, courageous and self-centered, at least in general. Many of these traits may seem obvious today, but they were not necessarily obvious prior to these studies. Back when their tests were being conducted and findings presented in the 1950s and ’60s, the very idea of a “creative personality” was a novelty in academic and public discourse.
The findings may not be groundbreaking to us today, but the documents and recordings produced during the study are certainly interesting. If you’re into this topic, there’s also this book you can pick up.
Oh, and if we are to have a third arm, I would like mine to run almost parallel to my existing dominant arm (right). That way I could double up on my most potent dexterity. It would also be far less intrusive than an arm on one’s head or in the middle of one’s back. Then again, it would ruin our symmetry as humans. And perhaps that third arms need to be celebrated instead of being masked.
What would you suggest?
Image: Institute of Personality and Social Research, University of California, Berkeley / The Monacelli Press (via 99% Invisible)
I just read an interesting chapter from Tim Smith’s book, "Pricing Strategy: Setting Price Levels, Managing Price Discounts and Establishing Price Structures." It’s Chapter 5: Psychological Influences on Price Sensitivity.
The chapter covers a number of pricing phenomenons, such as why prices ending in .99 tend to convey a discount and why whole prices ending in 0 tend to speak more to quality. It’s for this reason that art work is typically priced using simple round numbers.
But one of most interesting theories from the chapter is that of Prospect Theory. Not only because of its impact on pricing strategies, but because, I think, it also applies to the real estate development business.
Prospect Theory essentially describes the way people make decisions in the face of uncertainty. The two big takeaways for me are (1) that potential losses carry more weight than potential gains and (2) that both losses and gains experience diminishing returns.
What this effectively means is that people, when faced with risk, tend to focus more on the negatives, and the potential losses, than on the positives. This means that the gains just can’t match the losses, they have to be significantly greater if you’re going to inspire action (a purchasing decision, a change in behaviour, or whatever).
The second point basically means that these gains and losses become muted after a certain point. If you hit someone with enough of either, eventually they reach a point where they become desensitized in a way. Each additional amount of gain or loss produces less and less impact.
Besides the obvious point of making sure that your product or service results in lots of gain for your customer, there are a couple of other things you can do to respond to this theory.
The first is to “bundle losses” and “unbundle gains”. In other words, hit people with all the losses at once and then spread out the gains. What this does is maximize the psychological perception of gains and minimize the perception of losses because, remember, after a while people start to discount the losses.
The other thing you can do is transfer losses, which is often just the cost itself, from direct to indirect. Big box stores, as an example, are great at this. They offer low prices (a direct cost) in exchange for greater indirect costs: higher transportation costs to the user, greater environmental impact, and so on. Studies show that people feel direct costs much more than indirect costs.
There are a bunch of things you can do based on this theory, but again, one of the most fascinating things for me was how it also applies to the real estate industry. There’s a well known acronym in the industry called NIMBY. It stands for Not In My Back Yard, and it’s used pejoratively to refer to people who oppose development in their community.
However, if you look at NIMBY’ism through the lens of Prospect Theory, you realize that it’s almost an innate human reaction. Development and construction is disruptive and the end result is change in somebody’s community. And I suspect that most residents view it as a risky and uncertain situation. Therefore, it’s no wonder that they’re first reaction is opposition. They’re weighing the potential losses more than the potential gains.
So maybe we developers just need to apply a little Prospect Theory. We need to get better at producing and communicating gains.
Today I’m thinking about extraversion and third places within cities.
As many of you I’m sure know, the idea of a third place is that after your home (first place) and your work (second place), cities have what are known as third places. This could be a coffee shop, a barber shop, or a public space (to name only a few examples).
This, of course, is not a new idea. For decades people have been arguing that third places are essential for establishing a sense of community, place, and belonging. In fact, this emphasis on third place is one of the ingredients that made Starbucks so successful.
But with the rise of the internet and freelancing, third places are becoming even more important. That’s why coffee shops have become arguably the best example of a third place in today’s cities. They’ve even become the new second place for some (many?) people.
But beyond just a place to meet and socialize, I’ve been thinking today (while I was at a third place) about the psychological benefits of these spaces.
For example:
One of the key differences between extraverts and introverts is where they draw their energy from. For introverts, they tend to draw it from within. In order to recharge, they often feel the need to retreat and be left alone. Extroverts, on the other hand, draw their energy from the outside world. They charge up by being around other people.
When I was completing my MBA at Rotman, one of the things they had us do at the beginning and at the end of the program was complete the Myers-Brigg personality test.
In both instances, I was as extroverted as they come (I am consistently what is known as an ENTJ). And from experience, I can say that I definitely feed off the energy of other people.
But the interesting thing about this – to tie both of these topics back together – is that there appears to be a clear correlation between extroversion and a preference for living in urban centers. And given what I just said, that probably makes sense to you.
So if you too classify yourself as an extroverted person, then third places are more than just a busy coffee shop or a vibrant public space. They are where you derive your energy and where you feel alive. And that’s a pretty powerful thing in my view.
Today I’m thinking about extraversion and third places within cities.
As many of you I’m sure know, the idea of a third place is that after your home (first place) and your work (second place), cities have what are known as third places. This could be a coffee shop, a barber shop, or a public space (to name only a few examples).
This, of course, is not a new idea. For decades people have been arguing that third places are essential for establishing a sense of community, place, and belonging. In fact, this emphasis on third place is one of the ingredients that made Starbucks so successful.
But with the rise of the internet and freelancing, third places are becoming even more important. That’s why coffee shops have become arguably the best example of a third place in today’s cities. They’ve even become the new second place for some (many?) people.
But beyond just a place to meet and socialize, I’ve been thinking today (while I was at a third place) about the psychological benefits of these spaces.
For example:
One of the key differences between extraverts and introverts is where they draw their energy from. For introverts, they tend to draw it from within. In order to recharge, they often feel the need to retreat and be left alone. Extroverts, on the other hand, draw their energy from the outside world. They charge up by being around other people.
When I was completing my MBA at Rotman, one of the things they had us do at the beginning and at the end of the program was complete the Myers-Brigg personality test.
In both instances, I was as extroverted as they come (I am consistently what is known as an ENTJ). And from experience, I can say that I definitely feed off the energy of other people.
But the interesting thing about this – to tie both of these topics back together – is that there appears to be a clear correlation between extroversion and a preference for living in urban centers. And given what I just said, that probably makes sense to you.
So if you too classify yourself as an extroverted person, then third places are more than just a busy coffee shop or a vibrant public space. They are where you derive your energy and where you feel alive. And that’s a pretty powerful thing in my view.
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