Chapter 2

Epistemology and Philosophy of Science

Why They are Useful for Marketing

Think.

—IBM founder Thomas J. Watson, Sr.’s one-word slogan for his company

Thinking is hard work, which is why you don’t see a lot of people doing it.

—Sue Grafton, U.S. mystery novelist

Thinking and Acting Scientifically

Scientific discoveries have enhanced and even saved our lives, and most discoveries were preceded by sound scientific reasoning. It’s true that some, such as the discovery of penicillin, the smallpox vaccine, and X-rays, occurred by chance, if not just plain dumb luck. But it took scientific tools such as the development of theories for these breakthroughs to achieve their true potential. For example, cell theory—the study of the structure, function, and operation of cells—was a necessary condition for Dr. Alexander Fleming’s serendipitous discovery of the penicillium mold to be manufactured into an efficacious antibiotic drug.

Other discoveries have come about simply by the brute force of experimentation and scientific reasoning. Notable examples are Albert Einstein’s special theory of relativity (1905), James Watson and Francis Crick’s discovery of the double helix structure of the DNA molecule (1953), and the publication of the first human genetic map (2001).

The common denominator across all these revelations is something the philosopher Mario Bunge characterizes as a scientific “style of thinking and acting” that scientists use to create knowledge.¹ This characterization is broader than how people typically describe science’s success vis-à-vis the scientific method (TSM), which is a term generally described as follows:

Scientific researchers propose hypotheses as explanations of phenomena, and design experimental studies to test these hypotheses via predictions which can be derived from them. These steps must be repeatable, to guard against mistakes or confusion in any particular experiment.²

Science’s style of thinking and acting is much broader than TSM, as you will learn in this book. Scientific reasoning involves activities such as applying deductive and inductive logic to problem solving, avoiding logical fallacies, and developing theories that explain and predict phenomenon we see in nature or, in the context of this book, in markets.

If marketing is to plow the conceptual field that has so amazingly nurtured scientific discovery, we need to learn how to apply scientific reasoning to solving business problems. This means becoming familiar with some of the critical thinking tools that drive scientific discovery. This goal is not academic. Rather, it is one of the most practical endeavors a marketer can pursue, and might help us avoid making the same kind of mistake as Brunswick Corporation.

Brunswick: A Failure to Reason Scientifically

Brunswick, based in Lake Forest, Illinois, owns a variety of popular brands, such as Life Fitness exercise equipment, Brunswick pool tables, and bowling alley equipment. What you might not know is that Brunswick is heavily invested in the boating market. They own many boat brands as well as Mercury Marine, a marine engine manufacturer, headquartered in Fond du Lac, WI. In 2005, they purchased Sea Pro Boats Inc. for approximately $51 million in cash.

Brunswick wanted to increase and protect Mercury Marine’s market share by implementing a “captive business” model—purchase boat manufacturers and ensure their boat brands are only sold with Mercury Marine engines. If you purchase a Sea Ray boat, for example, it only comes with a Mercury Marine engine. In May of 2008, while I was director of Consumer Insights for Brunswick, the company discontinued the Sea Pro line of saltwater fishing and recreational boats. Part of Brunswick’s worldview of the saltwater boat market was the belief that the boat brand was significantly more important than the engine brand in the consumer’s purchase decision. This belief was supported by the company’s historically successful strategy of acquiring other boat manufacturers such as the freshwater, aluminum boat brands Crestliner, Lowe, and Lund. But boat buyers balked when they discovered they no longer could get the Yamaha engine they wanted on a Sea Pro boat.

For a variety of reasons, such as perceived product quality and brand reputation, competitors such as Yamaha and Honda had become (and still are) the major sellers of outboard engines in the saltwater boat market. Clearly, there were other mitigating factors influencing management’s decision to shutter Sea Pro by May of 2008, such as a weakening economy, but the fact remains that Sea Pro’s sales began to sink when customers could no longer get their preferred engine on their preferred boat.

From the perspective of applying a scientific style of thinking and acting to marketing, Brunswick made two critical mistakes of reasoning: First, their decisions were driven by unjustified beliefs rather than knowledge. As such, they did not critically examine the premises underlying their argument when purchasing Sea Pro. A premise is a reason for believing a conclusion.³ Their incorrect premise was that the Mercury engine would not negatively affect Sea Pro’s sales. Second, they made the inductive logic mistake of thinking that the “captive business” model that worked so well for freshwater boats would transfer seamlessly to saltwater boats. Ironically, marketing research conducted before the acquisition could have easily shown them the fallacy of their premise and the error in their logic.

Epistemology and the Philosophy of Science

To apply this particular scientific style of thinking and acting to marketing, we need to focus on two fields: epistemology and the philosophy of science. Epistemology is the “study of the nature of knowledge and of how it is acquired and justified.”⁴ Philosophy of science studies what it means for an area of inquiry to be called a science.

Epistemology can be considered the broader of the two terms, since it is “that part of philosophy concerned with the nature, sources and justification of knowledge.”⁵ In the field of marketing, marketing research plays the primary role of turning beliefs into knowledge, which are two terms I will elaborate on shortly. This is not, however, a marketing research textbook. Rather, it focuses on the scientific reasoning skills required before launching a marketing research study, skills such as defining one’s beliefs (introduced in the next section), and developing theories to explain and predict marketing phenomenon (the topic of Chapter 12).

“Philosophy of science, with its focus of attention on the character of scientific knowledge and on claims about scientific knowledge, may conveniently be construed as a sub-discipline of epistemology.”⁶ Philosophy of science explores relatively broad issues such as: what methods do scientists use to learn about a given field? And are some methods of inquiry better than are others? In today’s newspapers you will occasionally read about another focus of philosophy of science—“What is the difference between science and a pseudo-science?” This issue is particularly relevant with regard to the textbooks our children use in school, especially biology textbooks and the debate about whether Creationism should be taught alongside Darwin’s theory of evolution. Most of our emphasis in this book, however, is on epistemic matters, with occasional reference to philosophy of science issues as they relate to marketing and marketing research.

Definitions as Thinking Tools

The first step we need to take to learn about epistemology and the philosophy of science—as we would whenever we want to learn about any new subject—is to understand some key terms. Definitions are important because they can help you think more effectively. Let me give you a quick example that I will expand on in much greater detail in later sections. First, read the question below, then close the book while you answer the question in your mind, and then come back. Here is the question:

What does the term important mean with respect to understanding what consumers are looking for in a product? Close the book now!

Answer: It means nothing! Here is why…

Important is a vacuous term because it is extremely vague and ambiguous, often meaning different things to different people.⁷ For example, when asked what is important when purchasing a product, some respondents will talk about what is desirable. Others will talk about what affects their purchase decisions. Attributes that are desirable and influence consumer behavior are called determinant attributes. But unless you know how respondents interpret an “importance question,” you will not know whether consumers are talking about merely desirable attributes or determinant ones. When I was director of Consumer Insights for Brunswick, department policy was not to use the word “important” in verbal or written communications to internal clients, unless it was for the purpose of explaining why we did not use that word.

If you do not possess a basic understanding of a subject area’s concepts and definitions, you cannot think clearly or accurately about that subject. Marketing managers whose vocabulary includes the concept “important,” but not “determinant” cannot think clearly or accurately about what motivates consumer behavior, just as a brain surgeon cannot perform effective surgery unless he or she knows concepts such as neuron, synapse, cell, and the various parts of the brain such as the cerebellum, cerebrum, and the brainstem.

Some Preliminary Definitions

Now I need to define the following five terms: belief, fact, truth, knowledge, and theory. We do not need a comprehensive understanding of them to begin our journey—indeed, whole books have been written about the meaning of these concepts; however, as we learn more about them, our understanding of what they mean and what it means to think scientifically will become clearer. We can start with working definitions, although if I presented them in that room of philosophers I introduced you to in Chapter 1, at least three would jump out of their chairs and say I’m wrong.

Belief: A belief is what we accept to be true.⁸ For example, the following could be a few beliefs held by a hypothetical marketing manager: (1) “I believe that our advertising increased product sales by 10% this quarter,” (2) “I believe that consumers perceive the quality of our product to be the same as our competitors’ products,” and (3) “I believe that locational convenience is more influential than price in driving store sales.” Beliefs are often informed by past or current experiences. For example, “I believe that our advertising increased product sales by 10% this quarter” might be based on something you learned from an advertising course in college (e.g., advertising can increase sales), or from a direct claim made by your advertising agency. Additionally, a belief “is not an all or nothing matter but a matter of degree.”⁹ We hold some beliefs more strongly than others.

Fact: As the former senior senator from New York, Daniel Patrick Moynihan was famous for saying, “You are entitled to your own opinion, but you are not entitled to your own facts.”¹⁰ Narrowly defined, a fact is “anything that is known or assumed—with some ground [i.e., credible evidence]—to belong to reality.”^11,12 Clearly, a belief is not necessarily a fact. We will return to our discussion of beliefs versus facts later in this book when we discuss logic.

Truth: I personally like Shelby D. Hunt’s discussion of truth. “In viewing marketing science as a truth-seeking enterprise, we conceptualize truth as not an entity, but an attribute. It is an attribute of both beliefs and linguistic expressions [what we say and write]. …The truth-content of an expression is the extent to which what the expression refers to does, in fact, correspond with reality.”¹³ Brunswick’s tacit belief that the engine brand did not play a critical role in the prospective Sea Pro’s customer’s decision process did not correspond with reality, and therefore it was false.

Knowledge: Two kinds of knowledge that most concern us¹⁴ are called capacity knowledge and propositional knowledge. Clearly, Michael Phelps, eight-time gold medalist at the 2008 Beijing Olympics, knows how to swim. That is capacity knowledge (i.e., being able to do something).¹⁵ In one sense, this book is about capacity knowledge because its goal is to give you some tools (e.g., definitions, concepts, and a description of proper scientific thinking) to help develop your skills for applying scientific reasoning to marketing. But to think scientifically requires an understanding of propositional knowledge—the extent your propositions about reality are truthful.

Defining propositional knowledge is problematic. I will flesh out a more detailed discussion of this troublesome term, and its relationship to marketing, later. For now, we need a working definition that will not mislead, but still take us a fair way toward that juncture. A proposition is “a sentence or part of a sentence that expresses one and only one complete thought, which can be true or false.”¹⁶ To understand propositional knowledge, we start with Plato’s definition of knowledge as “justified true belief.”^17,18

• Justification: Knowledge is justified because it has “proper” empirical support—it is not merely a guess on your part. This is where the definition of knowledge gets complicated. If you are asking yourself, “What does ‘proper’ mean?” you are beginning to get a sense of why defining knowledge is problematic, and why I will return to this topic later.¹⁹

• True belief: Knowledge is true belief because a proposition has to be true or “approximately true,” to be considered to be knowledge. Bear with me. How, “approximately true” figures into knowledge is a topic I will address later in this book after we get more of an epistemic foundation under our feet.

Consequently, our working definition of “knowledge” is as follows: a properly justified true belief that is not a guess on your part, and which you take to be true. This is not a perfect definition—and actually, none exists to tell the truth of the matter.²⁰ But we can use it for the next several chapters until we revisit the notion of knowledge and how knowledge is created through the development of theories.

Theory: I dedicate all of Chapter 12 to the discussion of theory. For now, consider a theory to be your best explanation for a current or expected marketing phenomenon. There are, of course, good and bad theories. Good theories have at least two key elements. They enhance our understanding of marketing phenomenon (e.g., “Why was product X so successful?”), and they have some predictive power (e.g., they enable us to predict with some level of confidence how a manager might successfully affect market outcomes—to make product X successful). Keep in mind that the term theory has many connotative meanings that are totally irrelevant to our discussion. A “theory” does not mean that a proposition is impractical or “academic.” As you will see, there is nothing more practical than a good theory.

Personal Observations

The purpose of this book is to change the way you think about solving marketing problems, which brings up another vexing issue that forces me to lay my cards on the table. Many senior executives—some of the same ones, by the way, who do not know the difference between what is important versus what is determinant—do not like the word “theory.” As a friend of mine—a former McKinsey consultant—put rather forcefully in an e-mail to me regarding how theory is received in the business world:

From bitter experience I know that the American corporate world is not just anti-intellectual.…it’s rabidly anti-intellectual. ‘Theory’ smacks of academia…aversion to its explicit cultivation in business [is] one of the defining differences between the two cultures.

This point was driven home to me recently when I was told by another consultant not to use the terms theory or hypothesis with the director of research and development at a client company, because it sounds too academic. If, however, we are to deploy the greatest principles of scientific discovery and problem solving to marketing, we need to cultivate an understanding of these terms, and others—such as belief, knowledge, truth, and experiment—and not be afraid to use them when appropriate.

In conclusion, the first step in solving marketing problems is to learn how to approach them in a scientific way. The word “science” derives from the Latin scientia, meaning “knowledge.” Therefore, it is only appropriate that I conclude this chapter by using a deductive logic argument (I discuss deductive logic in detail in Chapter 10) that, literally, proves my point:

Premise A: Effective decision making requires knowledge

Premise B: Marketers want to make effective decisions   

Conclusion: Marketers require knowledge

Rest assured, I am not recommending that managers research all their questions and mimic what scientists do in universities. Above all, this is a practical book. In fact, if your situation simply does not grant you much, if any, marketing research budget, you and your organization can still benefit by applying principles of scientific reasoning to solving marketing and business problems. Why? Because applying scientific reasoning, but not doing formal marketing research, is much better than letting muddled thinking alone guide your research investigations.