Why Malcolm Gladwell Wants You To Be Poor: Blink, The Tipping Point, and Personal Finance

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In the past two months, I’ve had the opportunity to read both of Malcolm Gladwell’s recent books, Blink and The Tipping Point. While both books discuss psychological phenomena that are genuinely interesting and useful, in both cases applying the message to your personal life is at best questionable, at least for the average consumer.

The Tipping PointTake The Tipping Point. The titular tipping point refers to the moment when something unique bcomes common; in other words, those points when something in society begins to change from one state to another.

When these phenomenon occur (think of the impact of the iPod since 2000, for example), the power of the phenomenon can convince people to buy things simply because of the force of the cultural change. Most of The Tipping Point focuses on the general methodology for starting such phenomena, such as identifying connectors (people with wide social circles), mavens (influential people who are considered “smart”), and salesmen (people who can convince others easily). Identification of these people and convincing them to evangelize for your product can result in a tidal wave of buying, and this is happening all the time – it’s this reason why I’m starting to get offered a lot of “perks” for promoting certain things to you and why some bloggers were given laptops with Windows Vista on them on the mere hope that they would evangelize about Vista. (Note to my readers: I will never write about something just because it was given to me – that’s just not how I roll. However, if something is given to me and it is in fact actually useful and appropriate to personal finance, I won’t hesitate to write about it.)

BlinkBlink, on the other hand, focuses on the power of the mind to make near-instantaneous decisions – in other words, instinct. In the book, Gladwell refers to this phenomenon as “thin slicing” – in other words, a person’s ability to gauge what’s important and interesting with a very small set of experiences – and the fact that these decisions are often “better” than ones that are carefully thought out.

As with the first book, however, there are ways to corrupt this process. Information overload is one key method, and this is part of the reason that in an aisle full of toothpaste, the more expensive products are often brightly packaged and loaded with bits of information about how great the product is. If you are strolling through the store and think “Oh, I need toothpaste,” you have to make a quick decision about what toothpaste to get, so the advertisers are hoping to affect your ability to “thin slice” by literally inundating you with information. You don’t have time to evaluate 100 different types of toothpaste in the store, so you gather bits of information quickly and often end up grabbing the one that will ensure a large profit for the company.

What’s your problem with Gladwell? I don’t have a problem with Gladwell at all; in fact, it’s a statement to the high level of quality of his writing – and the cultural impact that it has had – that this piece even exists. Both books make some very dramatic and interesting points about wider cultural phenomena and about how people think.

However, both books describe sociological phenomena that are especially powerful in marketing and in convincing people to buy more by leveraging these phenomena. In a nation where people are more and more susceptible to marketing and have convenient credit available to them, they are buying more than ever – and acquiring significantly more debt than ever before.

What can I do? If you want to be able to resist the allure of effective marketing, it pays to know something about how marketing and advertising works. Thus, if you read either of these books from the perspective of a layperson or consumer, keep your eyes open for how these things actually work to affect your purchasing. For example, whenever a hot, new faddish item appears, recall from The Tipping Point that this is merely the amplification of the salesmanship of a small number of people. If you get home from a shopping trip and find that you’ve made a number of impulse buys, recall Blink and the fact that advertisers are intentionally inundating you with information so as to influence that split second when you make a decision to buy.

Although Gladwell’s books have been quite influential to marketers, don’t forget that they can be just as informative to you as a buyer.

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18 thoughts on “Why Malcolm Gladwell Wants You To Be Poor: Blink, The Tipping Point, and Personal Finance

  1. I quite liked his books, and I don’t understand the title you picked for the post. By writing these books, isn’t he simply informing the consumer of things that marketing teams have known for quite some time? Which would be…good? Knowledge for the consumer?

  2. The ideas in both books, when applied to consumer transactions, do not benefit the consumer. Knowing about them helps, but their existence makes it more difficult for anyone to resist consumerism.

  3. Interesting point about both books Trent, although I think Gladwell would argue that your consumer / marketing example isn’t the best example of “thin slicing.” It seemed to me that it had a lot more to do with things whether someone was a friend or foe or why someone “just knew” a business decision would be a good one.

  4. I’m finding the title of this post offensive. It’s offensive because the logic is specious at best and seems like it’s framed to cause controversy, and thus, call attention to your blog.

    Malcolm Gladwell did not invent these marketing tactics, nor does he work for a marketing firm, nor is he advocating that anyone be poor or that he wants people to be poor. You didn’t support the title of this piece with any evidence whatsoever.

    You’re really overstepping yourself here with the title of this post, and you’ve lost a recent reader as a result. I don’t understand why you’re writing about things that you don’t understand fully. I am not a Gladwell apologist, I don’t even know that I like or agree with him, but what I don’t like is the way you tried to twist your review of these books in order to generate controversy.

    BTW, companies have sent out free samples for years. It’s called publicity, people, and bloggers are not some kind of holier than thou segment of the population. Microsoft didn’t invent that, either, so let’s not hold that up as a reason they are a ‘bad’ company – I guarantee you Apple hands out free stuff too.

  5. Former Reader: my only guess is that you read the title, skimmed the article quickly, and then posted this comment. I have no explanation other than that for what you said, because I gave clear examples for both books how the ideas within are used by marketers to effectively coerce consumers into buying things. The reason America is deep in credit card debt is because people buy too much stuff that they do not afford, and these books do nothing but reinforce the idea that this is appropriate.

    Of course, I do not expect a discussion on this topic because rather than sticking around to discuss it (as would normally be expected), you’re announcing that you’re no longer going to read this blog. “Blink” at work, indeed.

  6. I’m all for having a sensitivity to be offended when those offensive moments come, but I’m scratching my head trying to figure out how the title of this post is so offensive. People yelling racial epithets is offensive, but titling a post with the aim to show that eating up the marketing machine can lead us to being over our head in debt???

    I like the Gladwell’s writing and the topics he has chosen to write about. I think more education is always more helpful, especially in managing our money. In other words, if we know how marketing phenomenas happen, we can counter the lies that the marketers want us to hear.

  7. Former Reader: I find it hilarious how you tell Trent that he shouldn’t write about something that he himself does not fully understand yet you do the exact same thing.

    It is obvious that you did not fully read the article, and it is obvious that you jump to a conclusion and could not get past the title. You did not fully understand what Trent was talking about yet you still commented? You violated your own rule.

    You also accuse Trent of causing controversy yet you make such a big deal out of the whole article as if to have an alternative motive. You commented in a way expecting to influence other readers with your opinion. Another violation of your own rule.

    I have read both of Gladwell’s books which is why I thought it was very clever how Trent titled the article. Of course if you had read Gladwell’s books, and actually read the article you would have known that.

  8. The problem with the title is you are taking several leaps. In essense his books are describing how our society works. He explains it and tries to teach the reader how to master both aspects. In the tipping point its largely about getting that idea, product, whatever to the tipping point. In Blink it is how to master, trust, and use your ‘intuition’ to your advantage. You are focusing on a just a portion of his ideas that deal with consumerism and then saying that because he talks about consumerism and successful marketing that he wants people to spend more money than they earn and thus be poor. The title seems more about sensationalism that the content of the article. You seem to be implying that by writing about this somehow created it or taught companies how to make us buy more things.

    You could easily make the reverse statement and say that he wants us to be rich by teaching the common person how to successfully market themselves or their products.

    Anyways I don’t care what you title your posts, but it is an eye catching title, that doesn’t represent what you are talking about (unless you really think that Gladwell want people to spend more than they earn). Something like, “How Maxwell Gladwell thinks society tries to keep you poor” would be much better.

  9. Trent, some of your comments about marketing and consumerism reminded me of two books I read by Juliet Schor. Both “The Overspent American: Why We Want What We Don’t Need” and “Born to Buy: The Commercialized Child and the New Consumer Culture” were incredibly fascinating and disturbing and eye-opening. I think you’d find them both informative and worth writing about here.

    One other thing: have you thought of recommending your readers get their books from the library? That’s even better than buying books, except for the really rare ones that are worth repeat reads.

    Thanks for your blog; I’m a new reader who plans to stick around.

  10. I have read the article again and still do not see the logic in the author wanting us poor. I have read The Tipping Point, and while it is largely about conformist trends centered around merchandise, I can’t make the leap to the author’s intention to reinforce this behavior at our expense.

  11. Well….isn’t one point of writing a blog to share one’s experience and point of view? Not to get to cliched with the PC comments (ugh), but Trent’s view of the book is perfectly valid. It may (or may not) be flawed, but he’s writing an OPINION piece.

    It would be much more appropriate if somebody dislikes what Trent has to say, to provide a counterpoint argument rather than to launch an ad hominem attack on Trent and his ethics as a blogger?

    Did I mention yet that one part of a good blog post is one that invites comment and discussion of the ideas expressed within?

    db
    http://www.debtblitzkrieg.com

  12. I have read the Tipping Point and some of Blink and I would have to agree that while the books are interesting, I find it hard (as a consumer) to take the ideas presented within and use them for my own benefit. In my opinion, it is always good to know WHY you are making a decision, but to keep in mind all the elements in play that Mr. Gladwell tells us about in his books would take a fair amount of concentration.

    I think the average reader will take away about 10 – 20 percent of the material and actually have it in mind when the common everyday purchase/negotiation. Like I said, I do find Gladwell’s books interesting. If you like those two books, you should also check out Robert Cialdini’s Influence book.

  13. Trent,

    As a former financial journalist, I enjoy your writings and insight. That said, I do think your take on Blink is slightly off-target.

    It’s been a couple of years since I read it, but wasn’t Blink primarily about micro-slicing; the idea that we see and recognize split-second facial movements people make? Our subconscious ability to recognize these movements influence our decisions more than we realize.

    The concept is more applicable to, say, talking to a Real Estate agent or stockbroker, than buying toothpaste. Ralthor’s take on the book is very accurate.

    Just my $0.02

  14. I’m at a loss as to the reasoning used in this post. Do you really think that advertising professionals were unaware of these techniques before Gladwell wrote about them? The net effect of these books is to educate the public, not to provide ammunition to marketers.

    In several responses, you mention that “the ideas” within the books are used to stimulate consumption, and seem to think that that’s sufficient to show that Gladwell is in favor of that outcome. Gladwell is simply explaining actual phenomena. He’s describing tactics that are already known and in use.

    Claiming that his explanation of the factors that influence how people make decisions means he is in favor of consumerism is as silly as claiming that Newton’s Theory of Gravity means he’s in favor of airplane crashes, or that Greenpeace’s literature on endangered species means they’re in favor of poaching.

  15. I’m in agreement that the title of the post is inaccurate, but that doesn’t make it a bad title. The phenomena that Gladwell writes about, may indeed make us poor and its also very difficult to guard against them. Thanks for bringing that to my attention Trent.

  16. And Malcolm Gladwell is another idiot who doesn’t know what “tipping point” means.

    Tipping point is the moment of inflection: when one is now going south, rather than West; when the pendulum stops swinging left; when straw lands on the camel’s back.

    Most particularily, it is when the thing _starts_ to move, not when everyone notices it moving rapidly.

  17. #9 beth – Welcome Beth! You’re right that this is a good blog, and it sounds like your brain is already moving in the same direction as Trent’s. As a long-time reader, I can say for Trent that he is a big fan of the library and of Paperback Swap. Funny enough, some of the biggest comment controversies on this blog were his articles about going to the bookstore to get content without buying (eg taking notes, reading while at the store, etc), and oh heavens his Prius purchase! Pretty funny posts to catch up on, if you like to see people getting really riled up about something really minor :)

    Oh, and if you are a new reader, also check out his homemade laundry soap, and his ode to how great his wife is (very sweet).

  18. #16 Thoglette – “And Malcolm Gladwell is another idiot who doesn’t know what “tipping point” means. Tipping point is the moment of inflection: when one is now going south, rather than West; when the pendulum stops swinging left; when straw lands on the camel’s back.”

    to your tone – This kind of sweeping, unexamined, unconsidered vitriol really gets me down when I go on the Internet. For some reason the anonymity of the Net makes it so that so many people say the thoughts in their heads in the worst possible way, without any kindness or compassion. I always feel a bit depressed about people when I read comments sections as a result.

    To your point – I’ve always found Malcolm Gladwell to be pretty darn intelligent, and a gifted writer who excels at communicating. So to call him an idiot based on your understanding of a term makes you look unkind, but also sweepingly ill-considered, and probably at least partly uninformed. It’s especially interesting because language is determined by usage (tip of the hat to my 8th grade English teacher), so if Gladwell had such a profound impact on our national discourse (which I believe he did), then his definition of “tipping point” may have become common enough to have usurped your definition. In which case he is not an idiot for his use of language any more than Shakespeare was.

    Also, straight from the horse’s mouth, you’ll see that he never said a tipping point was when “everyone notices it moving rapidly.”

    Gladwell: “The word “Tipping Point”, for example, comes from the world of epidemiology. It’s the name given to that moment in an epidemic when a virus reaches critical mass. It’s the boiling point. It’s the moment on the graph when the line starts to shoot straight upwards. AIDS tipped in 1982, when it went from a rare disease affecting a few gay men to a worldwide epidemic. Crime in New York City tipped in the mid 1990′s, when the murder rate suddenly plummeted. When I heard that phrase for the first time I remember thinking–wow. What if everything has a Tipping Point? Wouldn’t it be cool to try and look for Tipping Points in business, or in social policy, or in advertising or in any number of other nonmedical areas?”

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