A horse, a dime and an insurance policy.


Many years ago I watched a horse run the track at Ellerslie. I remember it well for a number of reasons, not least of which it was the first time I ever made a bet and the horse stole my hat.  I put $20 on the nose for a win. When Celsius crossed the finish line a length ahead of the rest of the field he was paying $22 for a win. I was thrilled and so began my passion for gambling.

In truth I didn’t expect to win, I didn’t expect he’d whip my hat off as he returned to the stables either.  I missed the next race he ran at Ellerslie. It didn’t go so well. About 150m into the run Celsius almost fell after stepping into a loosely repaired rabbit hole on the track. He stumbled, regained his composure, finished the race but did not place.

The next time he was at Ellerslie I put another $50 on Celsius. I’ll admit that I was expecting another great result. He was the first out of the gates and the hat thief was in control – right up until he slowed at 150m where he’d stumbled previously. He skipped sideways a little, pulled away from where he knew the hole had been and ended up boxed in. Celsius never won again at Ellerslie . The memory of the pain he’d experienced when he almost fell was etched on his memory.

So what has a horse got to do with marketing?

In short, it illustrates how we learn. I didn’t predict a win and Celsius didn’t predict the rabbit hole. We both learned a lesson that day that modified our behaviour. However, unlike poor Celsius, I had experienced a positive prediction error.

Specifically when I first won, my mid-brain dopamine neurons activated a “phasic excitatory response” – it happens during times when we’ve been exposed to visual, auditory and somatosensory reward-predicting stimuli, and physically intense visual and auditory stimuli. Blah, blah, blah … for all the neurology, click here.

Cutting to the chase “Surprise is addictive!”

If you give a customer an experience they didn’t expect, be it positive or negative then they ‘learn’ about your brand through this experience.

Dumbed down …  Dr. Wael Asaad, an expert in Surprise and Memory explains, “Positive prediction errors encourage you to repeat the activity that led to the reward, whereas negative prediction errors nudge you to try an alternative strategy.” Hence the horsing around!

What it means for the marketer.

This creates a compelling case for the construction of a mechanism that can reinforce loyalty for existing customers, but also for re-training
‘promiscuous’ customers.

If you think you can’t afford to be delighting your customers, here’s some dopamine for you. It costs less that you think to change someone’s feelings and perceptions.

Back in 1987, Norbet Schwartz (no I didn’t make that name up) conducted a study. It measured the life outlook of subjects who had found a dime on a photocopier versus those who didn’t.  A dime (albeit worth more in 1987) bought happiness, based on the experience of something good happening that day. It’s not the value of what they found. It’s that something positive happened to them.

Connect that feeling with a customer experience and you have a powerful, near addictive moment where a customer ‘learns’ more about your brand.

Two things happened to me in the last year: I got married; and one of my dearest friends died of cancer. It got me thinking about many things, including my life insurance – or lack thereof. For the first time I took out a life insurance policy. It wasn’t an onerous experience and all the paperwork was processed quickly. It was a brief foray into thinking about my own mortality and it was done and dusted.

Two weeks after it was approved I received a $50 pressie card in the mail in recognition of my third policy with this insurer.

I didn’t expect it. It was a surprise! And it builds on some already great experiences with this insurer. Good luck to anyone else trying to woo me away. It was $50 well spent.

By the way, Celsius retired to a farm outside Whangarei and, because of his small stature and gentle nature, remained the favourite of the Riding for the Disabled kids for years.

For a world class case study, click here.

 Author: Marnie Brannigan, Senior Account Director