System 1 vs. System 2

Rishi Rawat Blog Posts 6 Comments

As far as I’m concerned the key to developing an edge in marketing lies in our understanding of the subtle differences between System 1 and System 2.

These are states of mind.

System 1 is the default state. It’s what activates when you encounter anything. It’s emotional and irrational.

System 2 is the analytical state. You want to believe you bought your home using System 2 (even though you likely did it with System 1). System 2 is lazy as hell, which is partly why we use it so little even though we have every intention to do so.

And System 1 and 2 can fool even the most well-prepared individual.

Here is my story from this morning.

I used to use my wife’s Starbucks app for points. Last week I created my own account.

Starbucks app uses the heck out of gamification. The message states I’m x points to Gold status:

Starbucks app gamification
Starbucks app screenshot

I don’t really know what all that means but one benefit of gold status is that Starbucks waives the $0.52 fee when you get a refill on standard coffee. System 2 would scoff at this deal because I get a refill once every 60 days (2 months). At that rate I’ll be saving $3.12 a year.

But let’s look at my actual behavior: this morning I was planning to make a run and asked my wife what she wanted. She wasn’t sure so I nudged her to get a fancy drink. Why? Because my subconscious is dying to get to the magical 300. I’m wiling to waste money over coffee I would not normally get so I can get 20 points closer to a made up number. And I’ve been behaving this way ever since I downloaded the app.

What is going on? System 1 has taken over the asylum.

Don’t laugh. It’s taken over your head too.

Comments 6

  1. This is extremely true. I regularly follow deal sites. I often see great deals for things I want but don’t need. System 1 tells me I should get it and then I come up with reasons on why I need it. It’s always a battle keeping system 1 in check!

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      1. When I was younger, my friends and I were very into Remote Controlled airplanes.

        There was this one website called “Horizon Hobby” where we bought a lot of equipment and planes from.

        They cleverly gamified reviews.

        If you left a review, your account would say “top 10000 reviewers” and if you left more reviews it might say “top 100”.

        My friends and I got really into this and we would review every product we could so that our rank would be more impressive.

        I think the best we got was top 30… there were some old guys who killed it with the reviews and we could never catch up to them 😜

        Pretty interesting huh?

        A little badge on random website account technically means nothing, but it meant a lot to us. 😜

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  2. Immediately what came to my mind was how cereal companies (not sure if they still do because I don’t buy cereal) and Cracker Jacks put in a cheap toy inside the box. I wanted the toy more than the cereal or the Cracker Jacks. But the toy was basically a worthless piece of junk. But it was “free” and I was so darn excited to get it! That I would pester my mom to buy that stuff. When it would have worked out better for her to buy a cheaper version, and then also buy a cheap toy.

    Kinda similar to Happy Meals at McDonalds. My daughter didn’t really like McDonalds food but she liked the free toy that came with it. So guess where we went….

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      Hey, Ron. What’s remarkable is that even when know this it still subconsciously tugs at us. Thanks for sharing the cereal box story.

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