In 2003, two Spanish brothers bought a painting, a Goya, worth 250,000 Euros.
It was a bargain, so they made a 20,000 Euro down-payment and collected the picture.
They knew it was genuine because it had a certificate of authenticity.
It didn’t occur to them that if someone could fake a painting they could also fake a certificate of authenticity.
Which is exactly what happened, and an expert declared the painting and the certificate of authenticity were both fakes.
But the brothers knew they were smarter than most people.
If the forgeries were good enough to fool them, then they were certainly good enough to fool anyone else.
The brothers met a man who worked for an Arab Sheikh, he said the Sheikh would be interested in buying their Goya, the brothers said the price was 4 million Euros.
The man said he would want a fee of 300,000 Euros for arranging the sale.
They met in Turin, the man brought a suitcase with 1.7 million Euros as down-payment on the painting.
The brothers drove home via Switzerland but, when they got to the French border, customs officials opened the suitcase, they found the money was all fake.
The brothers had been paid 1.7 million Euros in forged notes.
Without telling the brothers, the French authorities phoned the Spanish authorities and when the brothers returned to Spain they were arrested for smuggling counterfeit currency.
The only genuine money was the 300,000 Euros they’d paid the middle-man, which they had borrowed and were now in debt for.
The brothers had been stupid to buy a fake painting in the first place.
But their bigger mistake was thinking that other people would be as stupid as them.
They thought they were smarter than everyone else so they could fool other people.
In financial markets this is known as the ‘Greater Fool’ theory.
Someone buys a stock, finds it is worthless, then believes they can find someone more stupid than them to sell it to, a ‘greater fool’ in fact.
A bubble happens when everyone believes this will continue, and the market carries on growing until it runs out of fools, at which point it collapses.
This is what is happening in advertising.
We know what we are doing is fake, but we don’t think anyone else will know.
Current marketing thinking is “brand purpose” advertising.
This is just a complicated way of saying whatever we’re selling let’s pretend it will change people’s lives, they’re dumb enough to believe it.
But why should people believe it, when we don’t believe it ourselves?
There isn’t a single person sitting in an advertising agency anywhere that truly believes a product will help you FIND YOUR NOW or LIVE YOUR DREAM or BE YOUR TRUTH.
They don’t believe it, but they expect ordinary people to swallow it.
Before he was a comedian, Jimmy Carr used to work in advertising.
When he graduated from Cambridge he became an account man, and he puts it like this:
“Adverts used to be about products. They would tell you what the product did and you would either need that thing or you wouldn’t need that thing. Real simple.
But then there was a shift in emphasis, a sleight of hand.
Now the advert is selling you a desire – power, success, peace of mind.
They pick a desire and they say, “If you had this, then you’d have that.”
We know we’re selling things we don’t actually believe ourselves, but we think consumers will believe it.
And yet we know that, before we got into advertising, we were just consumers ourselves, and we didn’t believe it then.
So who’s really the greater fool?