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Leadership, Authority and Influence are All Intertwined

I’ve spent a lot of time the past six months immersing myself in leadership material from Focus 3 because it’s really good stuff. They’re called Focus 3 because they focus on three things: leadership, culture and behavior. Their overarching view is this: leaders create the culture within an organization which drives the behaviors that lead to results.

Tim Kight, the founder of Focus 3, did a presentation on How Leaders Achieve Great Results and during that talk he said something that resonated with me. He told the audience, “Leadership is not authority based on a position you’ve been given. It is influence based on trust you’ve earned.”

Are you a leader? Leaders have followers. You may have the title and corner office but that’s no guarantee that people will follow you. Even if they follow, are they doing so enthusiastically or begrudgingly? If they’re only following because they have to then they’re not much better than those who don’t follow.

Getting people to follow you is where influence comes in handy. Influence, when used correctly and ethically, can help build relationships and trust as well as motivate people to action.

How do you build relationships?

Engage the principles of liking and reciprocity and you’ll find it a bit easier because when people like you they’ll be more inclined to do what you ask. But the key isn’t to try to get them to like you. Rather, you should make every effort to come to like them. Pay attention to others and look to connect on what you have in common.

Your other opportunity is to have the mindset that you want to catch them doing what’s right. When you do so and pay the person a genuine compliment it also works on your mindset. After all, don’t you generally think more highly of people you compliment?

As a leader, do you actively look to help your people grow and develop?

The second way to build relationship is by engaging the principle of reciprocity. When you coach them, provide resources and help them achieve their goals they’ll appreciate you and naturally look to repay the favor. When your team knows you have their best interest at heart it builds relationships.

Are you an expert and do you use it to help others?

It’s one thing to be good at what you do but it’s quite another to use your competency to help others get better too. The other half of the equation is trust. It does little good to be some kind of expert if people don’t trust you. Much of your trust comes from your character. Do you do what you say you’ll do? That’s why Aristotle said, “Character may almost be called the most effective means of persuasion.”

Finally, a leader needs to get people to take action.

The most effective way is by using the principle of consistency. Instead of telling people what to do (this doesn’t engage the principle) try asking. The big reason this is so effective is because once someone has agreed to do something they feel internal psychological pressure and external social pressure to follow through on their commitment. This is why I always encourage audiences to stop telling, start asking.

Becoming an effective leader isn’t rocket science but there is a science to it. When ethically looking for opportunities to engage the science of influence you’ll build relationships, gain trust and move people to take the actions necessary to ensure success.

Brian Ahearn, CMCT®, is the Chief Influence Officer at InfluencePEOPLE. His Lynda.com course, Persuasive Selling, has been view more than 100,000 times! Have you seen it yet? Watch it to learn how to ethically engage the psychology of persuasion throughout the sales process.

Overcome Mistakes, Mend Fences, Restore Trust

In life mistakes happen. In fact, they happen all the time because we’re imperfect humans. Quite often that means we need to mend fences if we want to overcome mistakes and restore trust. If you look up the phrase “fence-mending” one definition you’ll see comes from Dictionary.com; “the practice of reestablishing or strengthening personal, business, or political contacts and relationships by conciliation or negotiation, as after a dispute, disagreement, or period of inactivity.” Because mistakes are inevitable we need to know how to overcome the negative impact they can have on relationships. Let’s take a look at a simple three step process.

Apologize

Step one is to apologize. The good news is apologizing isn’t a skill you don’t possess. Apologizing is a choice any of us can make. It might feel awkward and uncomfortable but we can all choose to apologize if we can let go of our fear and negative emotions.

Ask for Forgiveness

It’s always good to know whether or not your apology was accepted. Simply ask, “Do you forgive me?” I’ve had people say that’s awkward in business so another approach might be asking, “Are we good?” There are two possible outcomes: you’re forgiven or you’re not.

If you’ve been forgiven that’s cool so leave it alone. In sales there’s something called “selling past the close,” and it can be fatal to making the sale. If someone says they want to buy then it’s time to shut up because talking more might cause them to change their mind! By the same token, when someone forgives you it’s time to shut up because your continued talking might reopen the wound you want to heal.

Let’s say the other person doesn’t acknowledge your request for forgiveness or says they don’t forgive you. Take the high road. You might say, “I’m sorry you feel that way. I can’t change the past so all I can do is apologize and try to do better going forward.” If nothing else you can leave the situation knowing you did the right thing. And maybe, just maybe the other person will forgive you in that moment or sometime down the road.

Prove Yourself

If you get the opportunity to prove yourself take it! I also encourage you to make sure the other person knows about your change. Let’s say you got a report in late and that negatively impacted a teammate at work. The next time you have to turn something in look to get in to your coworker a day or two in advance of when they asked for it. When you give it to them you might say, “I know I blew it last time but I wasn’t going to let that happen again so I wanted to get you this as quickly as I could.” Actions speak louder than words but words can be used to highlight your actions and bring them to consciousness for the other person.

Silver Linings

There are a couple of silver linings with mistakes. First, sometimes when you work to correct mistakes relationships can actually improve. For example, some studies show people rate the service higher at restaurants and hotels when there was some mix up but it was corrected to the satisfaction of the customer. Why is that? When you go out of your way to make things right you engage reciprocity. Most people see that extra effort and feel obligated to give a better tip, rating or satisfaction score.

Another silver lining is this; admitting a mistake can make you more trustworthy and enhance your authority with others. Authority is the principle of influence that tells us people defer to those with superior wisdom, knowledge or expertise. Authority rests on two things – credibility (you know what you’re doing) and trustworthiness (you can be counted on). The net positive with enhancing trust is increased authority which means people are more likely to follow your lead or advice down the road.

To Do

This week I encourage you to actively look for your mistakes that impact others. When you see them, don’t wait for someone else to discover them, own up to them immediately. This taps into Dale Carnegie’s advice, “When you’re wrong, admit it quickly and emphatically.” Doing so will allow you to practice a much-needed skill for interpersonal relationships and make it easier to do when the stakes are higher.

Remain Calm to Maintain Your Presence and Personal Power

I just finished Amy Cuddy’s new book Presence: Bringing Your Boldest Self to Your Biggest Challenges. I’ve been a fan of Cuddy’s since I first saw her Ted Talk which focused on how we can use our bodies to feel more confident and powerful. I highly recommend watching it and picking up a copy of her new book.

As I read the book I came across a section where she shared how her reactivity to criticism actually hurt her presence and thus her personal power. Her story reminded me of several huge lessons I learned early in my career at State Auto Insurance.

In the mid 1990s I moved into a new job which was a newly created position in the company. One of my responsibilities was to create new sales reports using Microsoft products so senior management wouldn’t have to wait for the old mainframe reports. They recognized creating and revising reports would be much faster and easier using the new technology.

I had produced a series of sales reports that were distributed to mid-level and senior managers throughout the company. A couple of managers from one office disagreed with some of my numbers and labels but rather than get with me to discuss the matter they sent a scathing memo to my boss and several others, including the CEO.

I remember where I was when I read their memo and I was pissed! Fortunately, I had the presence of mind to tell myself, “Your self-worth is not wrapped up in those reports.” With that I decided not to respond for a few days.

Once my head cleared and my emotions subsided I went through the memo and addressed every criticism in a response to my boss, the Vice President of Sales. Where I made mistakes, I owned up to them and told him what corrections I would make. Most of the report was correct and I made sure to point that out and why I believed that to be the case. My only goal was to make sure my boss knew I was on top of it.

Unbeknownst to me, he shared my response with the CEO. In turn the CEO promptly sent a note to all managers which said, “When I put Brian in this position is wasn’t to make him the resident S.O.B. of the company. If you have issues with what he produces please see me.” When the CEO has your back that’s a good feeling!

But here’s the icing on the cake. During a big market strategy session, with more than 50 of our top brass in attendance, one of the people who authored the memo was presenting information about his territory. As he discussed his market strategy report, which he had prepared himself, he told the assembled group of managers to, “Cross out that number because it’s wrong.” Moments later the company president slipped me a note that read, “Paybacks are a bitch,” and he smiled as I read it.

Between the backing of my boss, the president and our CEO, I knew I had made the right choice to respond rather than react to the situation.

Here are three big lessons I learned that might come in handy for you someday.

  1. Don’t be reactive. As Cuddy points out, you diminish your personal power when you react because you don’t allow yourself to consider the best options. This is especially true the more emotional you are.
  2. Admit mistakes. Dale Carnegie famously said, “When you’re wrong, admit it quickly and emphatically.” Doing this builds what Robert Cialdini calls your “authority” because you’re viewed as being more honest and trustworthy.
  3. Hold your ground when you’re right. It would have been a big failure on my part to not point out all the areas where I had produced correct information. The last thing you want it to continually be on the defensive if you want to be successful when it comes to persuasion.

Most situations you face are not life and death where thinking too long could be fatal. In the vast majority of the situations you encounter you have time to respond but you need to quickly remind yourself of that fact. Remember, you’ll have more personal power in the moment if you respond rather than react. I hope remembering this post proves as beneficial for you just as pausing did for me.

Persuasive Coaching: The Right Relationship, The Right Coach

Not too long ago, on a Saturday afternoon I was having a cup of coffee with my daughter Abigail. One of her friends stopped by and as you might expect, the conversation turned to what each of them had done the previous Friday night.

Abigail’s friend talked about how she and her boyfriend played pool. Her friend said she’s not a good pool player and her boyfriend tried to “coach” her. If you’re thinking, “I bet that didn’t go too well,” you’re right.

After a while I shared with the two of them that in order for coaching to work you have to have the right relationship and the right coach. For example, my wife Jane is an avid golfer. On her best days, she shoots in the upper 70s. I learned the game as a kid, took lots of lessons, and even played at one of the best courses in the United States – Jack Nicklaus’s Muirfield Village Golf Course. Despite my background, I don’t give Jane any advice unless specifically asked. If you’re been married for any length of time you know what I’m talking about. Having shared that, many people – perhaps even you – could give unsolicited advice to Jane and she’d give it serious consideration.

This phenomenon doesn’t just apply to spousal relationships. Why is this the case? Sometimes the more we’re known the more we’re taken for granted. Jesus noticed this an said, “A prophet is not without honor except in his own town, among his relatives and in his own home.” (New Living Translation)

Sometimes those most familiar to us, even though they have our best interest at heart, are rejected when it comes to advice. This can happen in business as well as personal life. Someone within the confines of a company can be seen as just a coworker and not an expert even though they may have plenty of expertise.

How can you overcome this? Tap into the principle of authority in two specific ways; create expertise inside the business and establish your expertise outside of your company.

Within the business work on getting one coworker to listen to your advice and try it. Once you’ve done this (assuming your advice worked well) you’ve established beachhead of sorts. With one person won over it becomes easier to win over the second, third and so on. By doing this you gain advocates (the principle of consensus) which makes future opportunities easier because those advocates can “brag on you” in ways you cannot, at least without seeming like a boastful jerk.

Outside of the business how can you establish expertise? You can blog, write a book, give presentations, create videos to name just a few. As you do this and begin to gain some notoriety. When people at work see others paying attention to your expertise it’s likely they will too. That’s also the power of the principle of consensus.

When it comes to persuasive coaching, assuming you’ve done a good job establishing rapport and building trust, people want to know they’re dealing with someone who really knows their stuff – an expert. What are you good at, known for and/or passionate about? Make sure others know that about you and you’ll begin to attract the right people to coach because you’ll have the right relationship and be seen as the right coach.

Persuasive Coaching – Competency and Trust, Two Sides of the Same Coin

In order for business coaches to be successful two elements are absolutely essential. First, they have to know what they’re talking about. In a word, they have to be competent. Second, they need to gain the trust of the people they’re coaching.

It’s of little value to be exceptionally intelligent if someone doesn’t trust your advice and direction. On the flip side, it won’t matter how trustworthy you are if you don’t know what you’re talking about. Competency and trust are two sides of the same coin so let’s see how persuasion can help those qualities come to the forefront in coaching.

Competence is simply knowing your stuff. This is important because it’s human nature to be more open to new ideas and change when we know the person we’re interacting with has expertise. That’s Robert Cialdini’s principle of authority in action.

Having expertise doesn’t mean coaches know everything. A coach doesn’t always have to know more than the person they’re coaching although it certainly helps. What’s important is that good coaches have trained eyes and ears they use skillfully to observe situations and behaviors. They may make suggestions based on their observations but the better route is to ask good questions because doing so allows the person being coached to come up with their own solutions. Taking this approach is especially helpful because it taps into the principle of consistency.

Consistency alerts us to the reality that people feel internal psychological pressure and external social pressure to be consistent in what they say and what they do. When someone believes they’ve come up with a solution, as opposed to being told what to do, they own it more because of consistency. A sense of pride comes into play because we all feel our ideas are good ideas. This is why Dale Carnegie encouraged readers of How to Win Friends and Influence People to, “Let the other person to feel the idea is theirs.” Remember, competent coaches ask good questions!

Competence is also displayed through wisdom which is the application of knowledge. It’s not enough to be smart, you have to know how to apply those smarts in ways that help the people you’re coaching. When you know someone has done something for a long time you naturally assume they’re good at it. Something as simple as, “Sally, I’ve been doing this for more than 15 years now and what I’ve found is…” That little reminder of  years of experience makes the coach more credible. Of course, this can also be accomplished with a good bio or third party introduction.

When it comes to trust, credibility can be enhanced by admitting weakness. Nobody has all the answers so sometimes admitting that to the person you’re coaching gains trust because they view you as more honest. “Joe, that’s a great question, one I’ve never considered before. Would it be okay if I looked into it and got back with you during our next coaching session?”

Another way to gain trust is by displaying good character and adhering to consistency can help you. As a coach, when you do what you said you would do you’re more believable and trust grows. In the example above, getting back to Joe in the next coaching session gives Joe a reason to trust you. Little acts of doing what you promised reveal character and build trust over time.

One last way to enhance trust is by engaging the principle of liking. Liking tells us it’s easier for people to say “Yes” to those they know and like. When you engage this principle don’t focus on getting the other person to like you. Instead, engage the principle with the intent of coming to like the person you’re coaching. When someone sees you truly like them you get a whole host of benefits and one big benefit is trust. After all, we naturally assume people who like us want the best for us and will do right by us. In short, you gain trust when someone knows you truly like them.

Remember, competency and trust are different sides of the same coin. You need both to be an effective coach and now you have a few simple ways to enhance them using persuasion when you coach.

The Immediate Influence of Behavior

Have you ever read Viktor Frankl’s classic work Man’s Search for Meaning? If you haven’t I can’t recommend it enough! It’s one of the most impacting books I’ve ever read. Despite the sobering description of life in Nazi concentration camps the book has sold more than 12 million copies since it was first published in 1946.

I recently suggested the book to several friends, so I decided to reread the book myself…for no less than the sixth time. Each time I go back to it something new jumps out at me and this time the following quote stood out, “The immediate influence of behavior is always more effective than that of words.”

Think about that quote for just a moment. Frankl’s insight from life in with most horrible conditions lines up with other similar observations from other great thinkers.

“Character may almost be called the most effective means of persuasion.” – Aristotle

“Who you are speaks so loudly I can’t hear what you’re saying.” – Ralph Waldo Emerson

Words do matter because they conjure up images, thoughts and feelings that lead to actions. Frankl acknowledged this when he wrote, “But at times a word was effective too, when mental receptiveness had been intensified by some outer circumstances.” However, as someone who wants to be an effective persuader your words will fall on deaf ears if your words and deeds don’t line up. “Do as I say, not as I do,” won’t cut it. After all, if you don’t believe what you’re saying or you don’t adhere to the principles you espouse then why would anyone else?

Nobody is perfect and people don’t expect you to be perfect. When you fail your best bet is to follow Dale Carnegie’s wisdom, “If you’re wrong admit it quickly and emphatically.” I believe most people are forgiving and many times you’ll actually gain credibility when you own up to your mistakes. This taps into what Robert Cialdini calls the principle of authority and the studies he cites show you can gain trust by admitting weakness or mistakes. The sooner you ‘fess up the better.

I observed this not too long ago when State Auto’s CEO Mike LaRocco interacted with employees across the country in an open forum. Since his arrival last May, Mike has encouraged a culture that embraces candor. During the open forum someone spoke up about fear of reprisal from managers when being candid and Mike made a flippant remark and basically blew off the person’s concern. But almost immediately he caught himself and said his response was wrong. He then proceeded to address the concern. Not only did his actions stand out to me, they stood out to many others I spoke with afterwards. He’s talking the talk and more importantly, he’s walking the walk.

So to come full circle, if you want to be effective when it comes to influencing others start with yourself and remember Frankl’s immortal wisdom, “The immediate influence of behavior is always more effective than that of words.” Be a person of consistency and integrity and you’ll enjoy far more professional success and personal happiness.

Persuasive Marketing the Old Fashioned Way

People often ask me if Robert Cialdini’s principles of influence are as effective today as they were when he first wrote about them 30 years ago. I emphatically reply, “Yes!”

The methods of communication may be changing – email instead of letters, text or instant messaging instead of phone calls, online advertising instead of television commercials, to name a few – but humans have not evolved nearly as much in the last century.

The human brain has not changed as rapidly as technology so you can rest assured the principles of influence work every bit as well today as in the past IF you understand them and employ them correctly.

Even though the preferred methods of communication may be changing, things like television ads, phone calls and letters are not going away any time soon so the smart marketer will be looking to use the principles with traditional media during this transition.

A friend recently gave me a marketing letter he received from AT&T because he knew I’d be interested in it from a persuasion perspective. I’d like to point out several places where AT&T is effectively using influence.

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At the top the letter had my friend’s name – John – which personalized the communication. Dale Carnegie said the sweetest sound to anyone is the sound of their own name. Our name catches our attention and that’s the marketer’s opportunity to keep you reading.

In the opening paragraph it reads, “Per your request…” Closely read the letter and you’ll realize it isn’t directed to the person who received the letter. It’s written to David Banks of AT&T’s Consumer Marketing Department. Like most people reading something like this I didn’t pay close attention so it took me a couple of reads to figure that out.

If the person reading the letter assumes it’s directed at them then “Per your request” taps into consistency. This principle tells us people feel psychological pressure to be consistent in what they say and do. If you requested something it’s much more likely you’ll take time to read the rest of the letter and consider the offer.

The next paragraph mentions a number of free offers. People love free to the point of irrationality. Dan Ariely wrote about our obsession with free in Predictably Irrational. One example Ariely frequently cites is how often people purchase additional items on Amazon just to get the free shipping. In the end they spend much more money!

Being offered the free items up front is an attempt to engage reciprocity although it doesn’t actually do it in this letter because unless you take AT&T up on the offer you’ve not received anything. It’s only when you get something that you feel obligated to do something in return. Nonetheless, a potential free offer keeps the reader interested.

The fourth paragraph reads, “We don’t want John to miss out on this great deal.” This is the principle of scarcity. People hate the thought of losing out, especially on great deals, so it motivates behavior that wouldn’t otherwise happen.

At the bottom of the page the “Reviewed” stamp adds an element of authority. As noted above, the letter is to David Banks from AT&T’s Consumer Marketing Department and the stamp shows he reviewed and approved the offer.

Last but not least is the “hand written” yellow sticky note affixed to the top of the letter. In a blog post I called 700,000 Great Reasons to Use Sticky Notes, I went into detail about how using these little post it notes can dramatically increase response rates. This sticky note looks hand written and that engages reciprocity because the perception is that someone took a little more time to put the sticky note on the letter and more time to actually write the note.

Now you may be thinking this would never work on you and you might be correct. However, it works on enough people that AT&T and many other smart companies incorporate this type of psychology into their communications. If it didn’t work they’d quickly abandon approaches like this in search of others that do work.

Using the principles of influence won’t make a bad product good or a lousy offer better. But, in a day and age where we’re assaulted thousands of times a day with marketing messages, small tweaks to communications might be the things that grab attention and keep people reading. And that’s the goal of marketing because in the absence of that, nobody would take AT&T up on an offer like the one you just read.

8 Simple Phrases to Become a More Persuasive Salesperson

I think it’s safe to say the easier something is to remember the more likely you are to act on it. State Auto’s Chief Sales Officer Clyde Fitch drove home this truth during his tenure with the company. Clyde had many memorable sayings we affectionately called “Clyde-isms.” He used these simple messages to drive home various points. Here are just a few of Clyde’s well-known sayings:

“Self-interest isn’t the only horse in the race but it’s the one to bet on.” A great picture of the reality that most people will do what’s in their best interest most of the time.

“If you only have bananas, sell bananas.” Don’t complain about what you don’t have or bemoan what your competitor has. Instead, make the best of what you’ve got because complaining gets you nowhere.

“Creativity is fine. Plagiarism is fast.” Learn from others by taking what they do well and making it your own. Sometimes it’s not about originality, it’s about having the tool to get the job done quickly.

I’ve learned a lot from Clyde and as I reflect on his “Clyde-isms,” I recall influence phrases that can serve the same purpose for you. Below are eight that will help you be a more persuasive salesperson if you commit them to memory.

“People live up to what they write down.” It’s scientifically proven people are more likely to do what you want if you can get them to put pen to paper. The act of writing and the visual reminder of what was written compel people to follow through more than those who don’t engage in this simple act. This is the principle of consistency.

“Less is more.” Hitting people over the head with too many facts, features, benefits, etc., works against you. One study showed this when people were asked to list reasons they would buy a particular car. Contrary to what most people would guess, those who listed fewer reasons felt more compelled to buy the car! It’s easy to come up with three reasons (probably the best ones come most easily) but if you struggle to list 10 reasons you might convince yourself the car isn’t the right one for you after all. This is the principle of scarcity.

“In wins!” This phrase is short for, “If you retreat in the moment you win. If you retreat from the moment you lose.” No matter how good a salesperson you are people will say no to you. However, if you come in with a second proposal immediately you’re very likely to hear yes because you’re seen as a reasonable, somewhat giving person. This is an application of the principle of reciprocity.

“Compared to what?” In sales you hear “Your price is too high” all the time. Something can only be high or low, big or small, inexpensive or expensive compared to something else. You need to know what that something else is because all too often it’s not a valid comparison. Yes, this Cadillac is expensive…compared to the Volkswagen you currently own…and there are lots of reasons for the difference in price. This is the contrast phenomenon.

“Keeping up with the Joneses.” Despite the fact that we’re all individuals and want to be recognized as such, people are social creatures. We want to know what others are doing; especially those who are most like us, because that’s an indicator we should be moving with the crowd. If you’re a salesperson touting what other customers (just like the one you’re talking to) have done makes getting the sale much easier. You may have heard this called peer pressure, social proof or the principle of consensus.

“People like to do business with people they like.” I’ve heard people say, “My job isn’t to be liked, it’s to get things done.” You may not be paid to be liked but you’ll get a lot more accomplished if people like you. So why not make friends of coworkers, vendors, clients and others so you can accomplish more (that’s what you’re paid to do!)? Oh yea, and one other benefit – you’ll enjoy what you do even more than you currently do. This is the liking principle.

“No pain, no gain!” This too is short for a longer phrase, “People are more motivated by what they stand to lose versus what they might gain.” Studies from Nobel Prize winner Daniel Kahneman and his late research partner Amos Tversky proved that people generally feel the pain of loss anywhere from 2.0-2.5 times more than the joy of gaining the same thing. Point out the downside of not going with your proposal and people will me more motivated to take it. This is the principle of scarcity.

“Stop telling and start asking.” Nobody wants to be told what to do but beyond being polite there’s another reason to ask instead of tell. Once someone tells you (verbally or written) they’ll do something, research shows they’re much more likely to do so as opposed to those who are told. Ask people questions to get them to verbalize what they want and your job as a salesperson gets a whole lot easier. That’s because asking triggers the principle of consistency.

So there you have it, eight short phrases I encourage you to commit to memory. Do so and you’ll become a more persuasive person as you recall them and act on them.

V = WIG/P … What?

Don’t worry; this post isn’t about algebra or calculus. This week we’re going to look into the value proposition and how salespeople can use the principles of influence to make sure their product or service offering shines.

First, let me say my introduction to the value proposition came nearly 20 years ago when John Petrucci joined State Auto. I learned more about sales from John in his first year with the company than I had in my previous 10 years in the industry. One concept he shared with me, and others throughout the company, was the following formula for the value proposition:

V = WIG/P

Value equals What I Get divided by Price

Let me illustrate. Let’s say currently you can buy 12 widgets for $6. That means the value of each widget is 2. At some point in the future, if you can get 18 widgets for $6 then the value of each widget is 3. Or, maybe you can get still get 12 widgets but now they’re only $3, which makes the value of each widget 4. In each case the value of the widget has gone up which is a better deal for you!

Conversely, if you can only get 12 widgets but the price has gone up to $8, then the value of each widget is only 1.50. Perhaps the price stayed at $6 but now you can only get six widgets. The value you get from widgets has dropped to 1. In both cases, not as good a deal as it once was.

Bottom line; if you can get more and pay the same OR if you get the same but pay less, you’ve received more value. On the flip side, if you get the same and pay more OR get less but pay the same as you always have, then you’ve received less value.

Oh if life were only so easy as a formula! If it were, we would just plug in the numbers and always make the best choice. But here’s the problem – rarely do things play out in real life like they do in the classroom or on paper. Most of the time what we’re offering, be it a product or service, has many components that become hard to value in a formula. Here’s an example from the insurance industry. Many people assume one automobile insurance policy is like another. To some degree that’s true but here are factors that may account for much of the price difference:

  • Coverages – Not all policies have the same coverages and not all have the same coverage limits. More coverage or higher limits means paying more.
  • Bells and whistles – Many policies have extra coverages that are intended to make the policy more valuable. While these may be free (you can’t remove them and save money) they add value to the policy.
  • Claims – Not all companies handle claims the same. Those with better claims service usually charge more because they have more and better staff.

As you can see, it becomes hard to measure value when there are so many factors involved. However, if you’re in sales you’d better know how your product or service is different from your competitors. Your offering may not appeal to everyone but you may have a niche market you go after. That usually makes highlighting value easier.

So how you do use some of the principles of influence to highlight value? Here are three easy-to-incorporate examples.

Authority – People look to experts for guidance when they’re not sure what to do. Can you point to unbiased sources that show the superiority of your product or service in certain areas? Can you fall back on your expertise (years in the business, training, breadth of experience) to make a potential customer feel more comfortable?

Consensus – Humans are essentially pack animals. The vast majority of people feel better knowing what others have said about a product. Can you incorporate information about what the masses think about your product? Is there an opportunity to narrow the focus to people just like the person you’re trying to sell to?

Scarcity – People are much more motivated by what they may lose versus what they might gain. Talking about saving $100 (if your product is less expensive) will not be as effective as telling the prospective customer what they’ll will lose out on by overpaying.

Most people only have a vague idea about the value of what they’re getting even when they do a little research. For more on that just go back and reread my article on buying something as simple as an iron. Do we really know the value of the work done on our car? How about buying a lawnmower? Hiring a personal trainer? The list could go on and on with products or services where we can only “ballpark” to get an estimate of value.

A good salesperson will ask lots of questions to identify someone’s needs. From there they’ll begin to point people to products or services that best meet those needs. While doing so they will look for ways to ethically incorporate authority, consensus and scarcity to the degree that each is available. Doing so will help highlight the value of their offer and lead to a better buying experience for the customer.

So remember, even if you’re not a math whiz, V= WIG/P is a formula you want to know cold if you hope to succeed in sales.

Jerry Seinfeld: Following the Lead of an Expert

I’m a big Seinfeld fan. No matter how many times I’ve seen an episode I always laugh. I’ve watched reruns so many times over the past 25 years I feel like Jerry, George, Elaine and Kramer are personal friends. What I appreciate most is how the show portrays everyday situations in such a humorous light. An episode I watched recently went right to the heart of one of the principles of influence, so I felt compelled to write about it.

In this particular Seinfeld rerun Jerry bought a fancy, very expensive tennis racquet from Milosh, the owner of the sporting goods store associated with the tennis club Jerry belonged to. A short time later Jerry discovered Milosh was a terrible tennis player while playing at another club with Elaine. Apparently Milosh was so bad he wouldn’t play at his own club because he knew it would kill his reputation and sales. The following conversation ensued between Jerry and Elaine later at Jerry’s apartment:

Elaine – “So he was bad. What do you care?”

Jerry – “Elaine, I paid $200 for this racquet because he said it’s the only one he plays with. He could play just as well with a log.”

What sealed the deal for Jerry was the thought of a tennis pro – an expert – playing with the suggested racquet. He thought if it was good enough for the pro then of course he should play with it too because pros only use the very best equipment.

Jerry’s actions go to the heart of the principle of authority – we rely on those with superior knowledge, wisdom or expertise, when making decisions. And the advice of an expert is even more effective when someone isn’t sure what to do.

Jerry had been playing with a wooden racquet and had no idea there was a better option available until the pro told him so. Any newer racquet would have been an improvement but the more expensive racquet must be better because, after all, “you get what you pay for,” according to the old saying.

This happens quite often, especially when someone takes up a new sport. They buy lots of fancy, expensive equipment because that’s what the best athletes use. Unfortunately the novices could have saved a lot of hard earned cash by going with good, but less expensive equipment, until they got much better. The very best equipment makes a difference for the very best players because sometimes the difference between winning and losing is a fraction of a second, a single stroke, or inches.

Is expert advice worth listening to? Most of the time, yes, but just be leery when that advice might lead to very costly purchases that make very little difference in the end.