Photo credit: Julian Hanford
Photo credit: Julian Hanford
A view from Dave Trott

A view from Dave Trott: the sunk cost heuristic

In 1912, The Titanic hit an iceberg and sank.

The experts said it couldn’t happen, it was unsinkable.

But the iceberg didn’t care what the experts said.

And around 1,500 people drowned because experts said it was unsinkable.

Well, yes, that’s partially true, but it’s not the whole reason.

The real reason so many people died was a stupid law.

Everyone could have been saved if there’d been enough lifeboats.

The law said there were enough lifeboats.

But it was a stupid law.

The 1894 Merchant Shipping Act governed the amount of lifeboats a ship must have.

Ships all the way up to 10,000 tons.

(Because no-one could foresee a ship bigger than 10,000 tons.)

A 10,000-ton ship must have 16 lifeboats, enough for 990 people.  

But, by 1912, ships were many times bigger than 10,000 tons.

The experts hadn’t noticed this, so the law hadn’t changed.

Titanic was 46,000 tons.

Titanic had 20 lifeboats, enough for 1,178 people.

But she could carry 3,327 people.

So she needed three times as many lifeboats.

Her original design had been for 64 lifeboats, but the owners thought they spoiled the look of the ship.

So they cut it down to just 20 lifeboats, so the first-class promenade deck would have a nice clear view.

After the sinking, the Wreck Commissioner’s Inquiry made the following recommendation: 

"The number of lifeboats should be based on the number of persons intended to be carried by the ship, not upon the tonnage."

No shit, Sherlock.

I used to work on a ship of about 10,000 tons.

We only carried cargo and had a crew of about 30.

An ocean liner of 10,000 tons carries around 200 passengers and has a crew of 150.

That’s more than ten times as many people as the ship I worked on, although they weighed the same.

So what difference does weight make?

Cargo doesn’t need lifeboats. 

So what a ship weighs is totally irrelevant.

Yet we had people making laws who couldn’t even spot that.

And that is why we should never trust experts, in any field.

Experts don’t like simple answers.

Experts like complicated answers.

But I’ve found, if something doesn’t make sense to an ordinary person, it usually doesn’t make sense at all.

If I ask a bus driver or housewife what’s the most important job of an ad, they’ll probably say something like: remembering the name of whatever is being advertised.

Because if you can’t remember the name, you can’t buy it.

Fair enough; that’s pretty basic stuff.

But ask our experts and they’ll say: brand metrics, big data, mobile optimisation, storytelling, content curation, sunk cost heuristics, algorithms, native advertising.

Everything except remembering the name.

Something as basic as remembering the name is totally forgotten.

Which is why most advertising is totally forgotten.

For me, it’s similar to judging the number of lifeboats by a ship’s weight instead of by the number of passengers.

We’ve forgotten what the job is.

Dave Trott is the author of Creative Mischief, Predatory Thinking and One Plus One Equals Three