Facts are not the Story. What you do with them is the Story...
Probably the thing I love most about marketing is mining insights based on human behavior and applying them to strategy. Not Probably. Definitely. Ok maybe the golf outings, boondoggles and steak and martini lunches from the early 2000s. But truly, I delve into human behavior, motivations, actions, it makes me feel just a little closer to the human race overall. Because many of these behaviors and motivations are pretty primal and instinctual, and although they may manifest with language in political posts and caustic tribalism, they are things that we share as commonly as our DNA as Homo Sapiens.
The source of insights...that's always been a tricky one for me. In our business you really have to "show your work" and cite syndicated resources or scaled primary research. Typically I'll use these after the fact to prove a hypothesis based on instinct, something I read, someone I've spoken to, something I've seen in the media. In the case I'm going to use in this article, which I find fascinating and will likely be a fan base of one, I haven't done the due diligence of backing it up with research; I'm going on one conversation I had this morning that rings so true, it feels like it doesn't need back-up. Here it goes.
Note: I want this to be an apolitical piece about human behavior related to something that has become politically charged. But it is not my intention to take the side of a political party. I want to take the side of the human heart and mind and potentially reveal undo anxiety through misperception caused by behavior.
Let's talk about the current division in the country about gas prices.
I filled up at the pump this morning. My Jeep Gladiator has a 22 gallon tank capacity, and I put in about 20 gallons. Gas prices do vary town to town, station to station, vendor to vendor. But for this article I'm going to use published averages because those numbers fuel the debate. And yes I had another gasp "I'm getting killed" moment that we've all had over the past few years when it topped out around $72.20. But something occurred to me about this morning's experience. For the past 3 years since Covid vaccinations more or less returned things to [new] normal, I've been DREADING getting gas because of the cost. So while I used to be one of those people who thought "oh my God I'm just below half a tank, I'd better get gas!" (you know us, we can't leave the house if our iPhone is less than 50% charged), I realized my sticker shock at the pump was heavily exacerbated by the AMOUNT of gas I was buying at each visit. I was buying less frequently, putting it off, and then at each visit getting hit hard, perpetuating the cycle. So I asked the expert: the woman who owns and manages the Lukoil in Madison, NJ (I did not get her name...rude). Keeping in mind she pumps gas morning, noon and night 7 days a week at her station, I take her observations as fairly authoritative and informed.
I asked her in very simple terms, if she has seen the AMOUNT of gas purchased per transaction increase, the way mine had, over the past few years. Without hesitating she confirmed that. These are the kinds of data she tracks to project cash flow, revenue, profits to make sure she hits her franchisee fees, can afford to fill up her tanks at the correct intervals and never runs dry, while paying for her house and feeding her kids. So she knows her business, for certain. I take that as an "expert" source, though admittedly focus group of one. However it seems unlikely that the citizens of Chatham and Madison NJ are behaving in ways that are wildly inconsistent with a large part of NJ, the Northeast and likely the US overall.
On any given day, I'll flip around between many "news" sources on YouTube, Cable TV, and other websites. And as we have all seen, it's like we live in two different realities (an oxymoron in itself). There is one world where gas prices have come down and are just fine. There is another where this country is going to Hell fast and gas prices are out of control in comparison to just 4-6 years ago. So let's just look at the numbers:
In 2018, gas prices hit a high of $2.95 / Gallon in NJ. This is an average across Regular, Mid-Grade and Premium (my statistician friends are already crying foul because perhaps those grades are not equally purchased...it doesn't matter...we're going to look at the prices in relation to each other over time; the relationship and percent difference is the important piece and will hold true for each grade or a weighted average).
$2.95 per Gallon in 2018, adjusted for the basic 20 year average inflation rate of 2.42% is $3.67 in 2024. If you applied the actual inflation rates that have roller-coaster'd for 3 years from upwards of 9% down to about 3.2% currently, that number is far closer to $4, perhaps slightly above. According to the AAA, the average gas price across all three grades YESTERDAY (January 28, 2024) was $3.61. No, those aren't typos or manipulated numbers; there's nothing funny there.
So what behavior is driving human perception? It is very likely the lingering dread of going to the pump, procrastination or reluctance, filling up more at each visit (albeit less often) and wincing at the cost.
Put in a real-life scenario, I would normally hit the filling station, put in half a tank or a little more (let's call it 12 gallons) which today would have been $43.32. Instead I got whacked for $72.20 (in 2018 terms adjusted for inflation, $73.40).
The scenario reminds me of a visual I've seen of a cylinder it from the side, projecting a rectangular shadow behind, and the same cylinder lit from behind projecting a circle in front of it. How can an object be a rectangle and a circle? Because the FACT is it's a cylinder. The perception we create by our actions make it a circle or a square.
The obvious application of the above information is best utilized by political parties in the coming year. But I would also posit that the fossil fuel / petroleum corporate giants could leverage this information to ease the heat on their vilification. Automobile manufacturers could find ways to disseminate this information, as the EV OEMs tout the high price of gasoline as strong lever to go electric.
As smart as we all think we are, we are just (as Aristotle called us) "naked apes". We are far more subject to our instincts, our behaviors are far more driven emotion, and our perceptions of reality therefore further from the truth than we would ever care to admit.
Keep your head on a swivel, keep your ears open. Insights come from anywhere at any time. And most interestingly and dangerously, the same "facts" may very easily enable opposing narratives. In politics that's partisanship. In marketing, that presents an incredible spectrum of messaging possibilities.
"The Average visit to the pump in the US is (example) $80 vs $45 just 5 years ago. Go Electric!" True
"The Average cost of a gallon of gasoline in January 2024 is actually LOWER than it was in 2018. Why pay $80,000 for an EV that weighs 500lbs more, has less range, fewer refilling locations and will explode if immersed in 6 inches of salt water?" True
And that's the business we're in. "STORIES well told", not "TRUTH well told" as they might say at McCann.
Since I've started pumping my own electricity into my battery tank, my interactions with gas station owners have gone down, but I couldn't agree more that they are a wealth of insights. If you want to know what's what, spend even 10 minutes with them, and you will get a technicolor view of the local economy and community.