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How is Cool Influenced?

 

I read an article questioning whether or not
Apple had lost, or is losing, its cool. Why should Apple be any less cool than
it was several years ago? After all, it’s the most valuable company in the
world at the moment. Is it because Steve Jobs and his dynamic, rebel
personality are gone? I’m not so sure about that because as an Apple user I
think the company’s products are fantastic and I’d imagine long time users
would say the products are better than ever.

As I started to ponder “cool,” it brought to
mind an episode from The Office in
which Michael Scott was trying to plan a celebration of his 15-year anniversary
with Dunder-Mifflin. To do this he enlisted the help of Jim, Pam and Dwight. At
one point during the brainstorming session Jim said of Dwight’s idea, “Now
you’re trying too hard and that’s just not cool.” Dwight responded, “Then I
guess I just don’t know what cool is.”
This begs the question, “What is cool?” I’m
dating myself with this reference but for those who grew up in the ‘70s one of
the icons of cool was Fonzie from the television show Happy Days. Fonzie was cool because he was so different from
Richie, Potsy, Ralph and the rest of the cast. Part of Apple being cool is that
it’s always been different than its competition. The tough part about that in
business is you never stay different for long.
Samsung’s Galaxy phone has many of the same
features the iPhone has and it has some things you can’t get with the iPhone
like the bigger screen. Marketing the bigger screen taps into the principle of scarcity. This principle of influence tells us people value things and want
them more when they’re less available, unique or different.
I believe scarcity goes to the heart of cool.
Fonzie was cool because he was different, a one of a kind. Part of the cool
factor for Apple is how it stays ahead of the curve with technology and usually
offers you something, or a package of things, you can’t get elsewhere.
Consider this question. If everyone had
dressed like Fonzie in Happy Days would
we have seen him as being so cool? Probably not. If everyone has an iPhone do
you think people will view it as being quite as cool as years ago? Probably not,
even if the technology is better.
Like beauty, cool is also relative. A
beautiful woman will not stand out as much when every woman is beautiful. If
you doubt that consider beauty pageants where every woman is a knockout but most
contestants quickly fad into the background as the pageant progresses. However,
those same women in your office, at the mall, or on the street would turn heads
because in those environments they’d stand out compared to the population in
general. That’s scarcity again, along with the compare and contrast phenomenon.
Much of cool’s scarcity comes in based on what
it’s compared to. Kids think they’re cool compared to their parents but within
the group of teens at school some of those same kids may not be considered cool
at all.
Ever notice how celebrities continually
reinvent themselves? Think Madonna, the queen of reinvention! Part of the
reason celebrities change so much is because their cool factor wears off as their
looks and character traits become more commonplace.
So how do you use this to be more influential?
Two areas to consider are you as an individual and your company.
When it comes to you on a personal level what
makes you unique compared to your peers and competition? I’ve seen people whose
signature is a bow tie and others who always wear colored shirts. Both stand
out in the world of dark suits, white shirts and regular ties. Remember, cool
is up to you to make. Being a “nerd” became cool after Revenge of the Nerds hit movie screens. All of a sudden being
really smart was cool if you could use that in ways to benefit others.
When it comes to promoting your company what
makes it stand apart from the competition? Does your business card look like
everyone else’s? Boring! Remember, if you do everything like the competition
then nothing stands out and you get no cool factor. In recent years many
insurance companies have gone from boring and bland to  much cooler through humorous ads. No longer do
people think of them as giant companies run by a bunch of grey–haired, middle-aged
men. They have a much younger, hip feel based on their ads now.
Whether it’s you personally or your company it
comes down to this; take time to consider your uniqueness. Can you combine that
with your strengths and passion to stand apart from your peers? If you can
leverage that you’ll gain some cool and probably more customers because
everyone loves cool.

Brian, CMCT®
influencepeople 
Helping You Learn to Hear “Yes”.

Some Problems with American Politics

I spent a good bit of time before New Year’s
flipping between CNN, MSNBC and Fox News to find out about the progress being
made on the “fiscal cliff” talks. The more I thought about that fiasco the more
I decided to share my view of the problems in American politics.
The average American seems to understand much
more than our elected officials. Married people know if you want a marriage to
work you need to learn to compromise. For the most part the ability to
compromise is seen as a good thing in life – except with our politicians.
In order to get out of the primaries,
representatives have to pander to the extreme elements in their party. That
means politicians take a hard line on many issues. They soften only slightly in
the general election with a goal of winning over as many undecided voters as
possible because neither party has such a stronghold that they can rely solely
on their base to get them elected.
Once the elected officials get to Washington
they’re beholden to those who elected them and the extreme positions they
espoused. The principle of consistency, the psychological
trait that tells us people want to be consistent in word and deed, makes it
difficult for politicians to move from their original positions even if new
data dictates that doing so would be best for the majority of Americans.
Despite what we learned about democracies and
majority rule it’s never that simple because of procedural rules that allow
each party to bring things to a halt or a snail’s pace. While there are good
reasons for these rules, they seem to be abused by both sides and the result is
the gridlock we’ve seen in Washington for far too long.
Another issue is the mentality politicians
seem to have about re-election. It’s almost the same mentality American businesses
now have about quarterly earnings. Businesses can be so focused on the
short-term that they make bad long-term decisions. For example, too often
companies don’t make needed investments in things like technology in order to keep
expenses low and boost quarterly earnings which makes the stock price look good.
In the same way politicians seem to do what’s best for them in the short-term
(i.e., get re-elected) as opposed to the long-term good of the country.
Personally I think term limits would help alleviate
this to some degree.
Lastly, I’ll share what I call “the law of the
gym.” When I was just out of college I was competing in bodybuilding contests.
My weight was around 225 lbs. and I would diet down to about 195 lbs. for
competitions. I quickly learned I could not burn enough calories through
exercise alone to lose those 30 lbs. In fact, exercising too much would
eventually be counter-productive to my goal. To put this in perspective,
consider this – running two miles burns approximately 250 calories or the
equivalent of a Snickers bar. Which is easier to do, run two miles or skip the
candy bar? It was obvious I needed to restrict my diet in certain ways. The
good news was, between the exercise and dieting I was always able to reach my
goal weight.
Let’s apply “the law of the gym” to politics
and our current debt situation. Tax revenues are like exercise; we can’t raise
them enough to get out of debt and raising them too much could actually hurt us
if jobs are lost. Our nation needs to go on a diet – spending cuts – in addition
to our exercise – recent tax increases. To go on spending as we are will only
cause the debt to grow. Hopefully our politicians can reach some compromise and
start reducing government spending so the debt begins to come down.
And speaking of the debt, we’ve become desensitized
to how large it’s become. Hundreds of millions, billions and trillions are
figures that no longer cause us to bat an eye. Only when you compare and contrast the debt to something
can you begin to wrap your mind around it, so here’s a comparison point for
you.  If you spent $1 million a day since
the time of the Egyptian empire you would only pay off a trillion dollars of our
debt. More than 2,700 years at a million dollars a day hardly makes a dent!
Now consider our national debt at roughly $16
trillion. If we could pay it down by $1 million a day it would take us more than 48,000 years to pay it off!
When politicians talk about it being immoral to pass on our debt to the next
generation that’s not as big a problem as passing our debt on to  thousands of generations! How would you feel if we were still paying down the
debt of the ancient Egyptians or Romans?
I no longer consider myself an affiliate of
either party because neither represents my views any longer. There are elements
of each that I agree with but there’s so much with both that I disagree with
that I can’t consider myself a Republican or a Democrat. It’s my hope that
sometime during my lifetime we get a third or fourth alternative to choose from
because right now most of us find ourselves choosing between the lesser of two
evils.
Brian, CMCT®
influencepeople 
Helping You Learn to Hear “Yes”.

How is the Wealth Pie Divided?

I read an article in The Atlantic recently that was a bit shocking and eye-opening, titled “Americans Want to Live in a Much More Equal Country (They Just Don’t Realize It).”  The article focused on people’s ideal, actual estimate, and the reality of how American wealth is divided up amongst the population.
Let’s suppose there are 100 people in a fictitious society and the average “wealth” per person is $50,000, for a total of $5 million in wealth for the whole society. Of course that $5 million would not be divided evenly because some people do better than others whether through luck, perseverance, or a little of both. On the opposite end, some don’t do well for a host of reasons.
Speaking of how well people do, let’s divide the 100 people into five groups of 20, so we have the bottom 20%, the next 20%, the middle 20%, another 20%, and finally, the top 20%. My question for you would be this: how would you divide the wealth pie between the five groups? In other words, how much of the $5 million should each group get?
In the article referenced above, people were asked a similar question without referring to actual dollars. According to their answers, in an ideal society, the top 20% would get 32% of the wealth. That would translate into $1.6 million, or 60% more than everyone would get in an “even” split. Then they were then asked to estimate how much total wealth the top 20% actually had, and they guessed almost 60%, which would translate into $3 million of our $5 million pie.
So what was the actual split in America? The top 20% in our society have 84% of the wealth, or $4.2 million of the $5 million pie! More shocking than that, is what the bottom 40% have to split – a whopping .3%. That means in our fictitious society the bottom 40% would have $15,000 of the $5 million wealth to share among 40 people. You read that right, $15,000 to share among 40 people.
In the field of influence, we talk about the contrast phenomenon which tells us what is presented first, i.e., how things are ordered, can make all the difference in how people assimilate the information. On this subject, in an article I posted last year, I wrote:
“We would do well to always ask ourselves what we’re comparing to and whether or not it’s a valid comparison or the best comparison. For example, I heard on a conservative news channel the Illinois state legislature was considering a 66% increase in the state income tax. Wow, that should be cause for revolt in this economy! But here’s the perspective from the other side; the state income tax would only go up 2 percentage points. And here’s where both comparisons come from; the tax will go from 3 percent to 5 percent. That’s 2 percentage points, a 66% increase. I’m sure those opposed to the tax talked about a 66% increase whereas those in favor focused on the 2 percent change. Both are valid and both will elicit completely different responses! Compared to what?”
As people see the inequity in our country more clearly it’s a sure recipe for discontent and that discontent will manifest itself somehow. We saw the beginnings of that with the “We are the 99%” and “Occupy Wall Street” movements. I don’t think people expect everyone will get the same slice of the pie but many feel they have very little opportunity to better themselves because of the obstacles they face. On the other end there’s the old saying, “the rich get richer,” because wealth reinvested usually creates income without the obstacles so many people have to overcome.
With the presidential election coming up, both sides are talking about the same issues but in very different ways. How each candidate presents his case will impact how Americans think about the issues and ultimately vote. As we struggle with record deficits, there is quite a bit of talk about how to rein the deficit in. In the most basic terms we can collect more money through taxes, reduce government spending, or have some combination of the two. My encouragement to you is simply this; during the election season pay very close attention to what is presented and how it’s presented so you can make the most informed choice.
Brian, CMCT
influencepeople 
Helping You Learn to Hear “Yes”.

Will J.C. Penney’s New Business Strategy Positively Influence Sales?

Have you heard J.C. Penney is going to radically change its business strategy? The giant retailer is getting rid of its traditional sales in favor of low prices all the time, slashing many items by 40% or more! In addition, they’re going to do away with confusing pricing for a simpler approach. No more $14.99 items, they’ll be $15, and those $19.99 items you love will be a nice round $20 or $19. Yahoo Finance ran an article, J.C. Penney gets Rid of Hundreds of Sales, which gives more details on Penney’s new strategy and some of the reasoning behind it.

On the surface you might think this is great for the consumer but don’t forget, Penney’s isn’t doing this for customers, they’re doing it to help the bottom line. The company believes sales and profits will be stimulated by the new strategy of lower prices and simplified pricing. To help with the implementation, the company has brought in some heavy weights in the retail industry from Target and Apple. This is obviously no ill-conceived idea but I want to look at whether or not it will positively influence sales.

Let’s start with doing away with the “the sale.” The sale is as all-American as baseball, apple pie, and motherhood! People love a big sale because it makes them believe they’re getting a great deal and that makes the buying decision easier for the consumer.  When you buy something on sale, part of the purchase decision is triggered by the contrast phenomenon. While $26 might sound reasonable for a certain item, it looks really good when compared to the normal $45 price, and you know saving $19, more than 40%, is a great bargain.

The downside is Penney’s is losing the bang for the buck, so to speak, because there will be no higher price to compare to and thus create the desire to take advantage of the deal. Considering nearly three quarters of Penney’s sales revenue came during promotions last year where prices were slashed by 50% or more, you begin to see how much they could lose if this strategy backfires.

And what’s up with that pricing? Charging $39.99 for an item doesn’t fool anyone because we know it’s practically $40. Selling an item for $14.99 can’t possibly induce more sales than a $15 price can it? It sure can!

In William Poundstone’s Priceless: The Myth of Fair Value (and How to Take Advantage of It) he cites a study in which sales were tracked for an item which sold for three different prices: $34, $39, and $44. Unit sales were highest for the $39 price as was the total revenue. When the item was priced at $39 total revenue was 9.5% higher when compared sales coming from the $44 price. When the $39 revenue was compared to the $34 price, total sales revenue was a whopping 50.6% more than when the item was sold for less! There are different theories as to why sales tend to be higher for items ending in $9 or $.99, but one thing is undeniable – it works. If it didn’t work retailers would have abandoned the strategy a long time ago.

As noted earlier, with former Target and Apple executives this change looks like it makes total sense on the surface and the new strategy might work. But let me bring to mind something many of you probably remember, New Coke. The new flavor for the world’s best-selling soft drink was a well-planned, thoroughly tested idea. Because New Coke was preferred by a margin of 2 to 1 in blind taste tests over regular Coke, it was thought to be a sure thing when it hit the shelves.  After all, what could be better than improving the best-selling product in the world? And yet it was an abject failure, considered one of the 100 worst marketing ideas of the 20th century. And you know the rest of the story as New Coke gave way to Classic Coke, the old standby!

J.C. Penney’s new strategy may not have the same kind of response as Coke, but my gut tells me after the initial PR wears off, Penney’s will be no better off and perhaps worse off because it will have abandoned some of the psychology that goes into the buying decision for many consumers.

 

 

The Influential Steve Jobs

I
recently read Steve Jobs by Walter Isaacson. It was an interesting book about one of the most influential people of the last 100 years. When I say Jobs was influential I don’t mean in the sense of necessarily using the science of influence. I say Jobs was influential because the products he developed are used by so many people around the world and have set the standard for many communication devices today. Indeed, the iPhone and iPad are the standards when it come to phones and tablet technology.

I found an interesting paradox as I was reading the book, because I enjoyed the book but found myself disliking Jobs the more I got into it. At times I caught myself thinking, “I love my iPhone but can’t stand him.” I almost felt guilty that I enjoy so much what he invented because of the path he took to get there and how he negatively impacted so many people along the way.
There were certain descriptions used of Jobs throughout the book that I found to be nonsensical, particularly his “reality distortion field.” The author and many people he quotes talk about Jobs’ vision – be it for a new product, deadline or something he simply believed – as if he had some magical power to distort reality. He was certainly a visionary and he had a strong will coupled with a bully-like approached that helped get things done. For those reading this who played sports, think of your meanest, toughest coach and multiply that person many times over and you begin to get the picture of the approach Jobs used with people. Nonetheless, if you enjoy Apple products or just biographies of people who shaped history then I encourage you to pick up Steve Jobs because it’s a fascinating look at the man who’s had so much impact on the world we live in.
The following paragraph caught my attention and is the basis for this post because it relates to the science of influence and sales:

“When it came time to announce the price of the new machine, Jobs did what he would often do in product demonstrations: reel off the features, describe them as being ‘worth thousands and thousands of dollars,’ and get the audience to imagine how expensive it really should be. Then he announced what he hoped would seem like a low price.”

Whether or not Jobs understood he was using the science of influence, he was, by tapping into the compare and contrast phenomenon. This is used all the time in sales because the price of a product can neither be high or low unless it’s compared to something else. That something is quite often another price. For example, when I first started running I went to a department store and got a pair of running shoes for about $40. They were much better than anything else I’d ever worn so I was happy until I realized I needed a better shoe after logging lots of miles. Imagine my sticker shock when I saw good running shoes at a real running store sold for $65 – $115! Fortunately for me there were some good salespeople who could clearly explain what I was getting for my money.
Sometimes the comparison point isn’t another price; rather it’s describing everything someone will get. A good description makes them realize they’re getting quite a bit and can soften the blow price might deliver. We see this all the time on infomercials when we hear, “But wait, there’s more!” That’s where the infomercial host goes on to describe all the extra ginsu knives we get for the same low price we were considering buying a single knife for.
Another example comes from my area of expertise, insurance. In your auto insurance policy there’s a coverage called “liability” which protects you in the event that you cause bodily harm to another person or damage their property in an auto accident. The most common amount of coverage people carry to protect themselves is $100,000. The bad news is that really doesn’t go very far in today’s litigious society when some cars are worth nearly that much and even a short
hospital stay can easily exceed that amount.
Having more than 25 years in the insurance industry I’d never recommend selling someone less than $300,000 in liability coverage. Of course the natural objection from a customer would be paying three times more for all of the extra coverage. But the good news is it doesn’t cost three times more! A good salesperson would use a similar approach to Steve Jobs and might say, “If you’re like most people you’re expecting to pay three times more for three times more coverage. While that’s a reasonable assumption I have some great news, it will only cost $X more, not even close to three times as much.”
The value of this approach is that it lets a customer see there’s clearly a need for the extra coverage (they hear about lawsuits in the media almost daily), and their satisfaction level will go up when they realize they’re getting triple the coverage for a fraction of what they expected to pay.
No matter whether you’re a salesperson, involved in marketing, work with advertising or just trying to convince your spouse to spend some money on something you want, look for legitimate comparisons that will make your request look like the best, most reasonable choice. You may not have as much success as Jobs did with Apple but science tells us the odds of you hearing “Yes” will go up rather dramatically.
Brian, CMCT
influencepeople 
Helping You Learn to Hear “Yes”.

Why the “We are the 99%” Movement?

Earlier this year a movement began in the United States known as “We are the 99%.” If you live in America it’s hard to believe you would not have heard about it because of the considerable media coverage the Occupy Wall Street protesters have received in major cities across the country. It’s a good bet most of my foreign readers have heard about it too because of the world-wide economic depression we find ourselves in, and of some similar protests internationally.

Why such dissatisfaction in the land of opportunity, the country where almost everyone wants to live? Certainly the financial crisis that led to the economic downturn in 2008 helped start the movement as many unemployed and underemployed Americans looked at what they perceive to be injustice caused by Wall Street and other large financial institutions.
I believe one psychological reason for the movement is rooted in a phenomenon Robert Cialdini, PhD., likes to call “compare and contrast.” This phenomenon tells us we experience things as being more different than they actually are depending on how they are presented.
According to the Congressional Budget Office, between 1979 and 2007 Americans known as “the middle class,” approximately 60% of wage earners, saw their income increase by 40%. Most people would say that’s not bad, until they compare it to the top 1% of American wage earners who saw their income increase an average of 275% during the same period. To make matters worse, when you group the bottom 90% together that group actually saw their incomes go down by $900. While the reasons for these gaps are many, the bottom line is this; it’s human nature to compare and contrast and the widening gap is a cause of discontent.
Is a person good looking? You can only make that determination by comparing that person to other people. Do you make a lot of money? Again, that’s a relative term and can only be answered by comparing your income to someone else’s. Many people are happy with their salary…until they find out they make significantly less than some coworkers. When it comes to compare and contrast, we all do it to one extent or another.
We live in a time of unprecedented wealth and even people who don’t earn much live far better than their relatives from decades ago. Indeed, it’s rare when Americans don’t have cable television, a computer in their home and a cell phone – hardly necessities of life. Yet there’s a tremendous amount of dissatisfaction because of the perceived income gaps and that they only seem to be growing larger as time goes by.
How did we get here? One statistic I share in my Principles of Persuasion workshop has to do with CEO pay. In 1980 a typical CEO made about 42 times more than the average American worker. By 1990 that figure had grown to 109 times. In 1993, the Fed mandated full disclosure of CEO compensation in an effort to help curb this trend but unfortunately their plan backfired big time. I bet you didn’t know this; by 2005 the difference between the typical CEO and average American worker’s pay had ballooned to 525 times! You read that right. In all fairness, in more recent years the gap has shrunk to a mere 269 times.

How could this have happened? After all, some of the thinking behind the full disclosure of compensation was to let everyone see how much CEOs and other top executives were earning so stockholders could put the brakes on the incredible income growth. It failed because of consensus.

Consensus, sometimes referred to as social proof, is the principle of influence that tells us we look to the actions of others when making decisions and this is heightened when we’re not completely sure what to do. Prior to the federal mandate about compensation disclosure it was an educated guess as to what the market was paying other CEOs in a given industry. Once it because public knowledge it wasn’t unlike what we see with star athletes in sports. Salaries for those athletes have skyrocketed because once an athlete knows what other top performers make their sports agent begins to negotiate an even bigger deal for the athlete. It’s a keep up with the Jones’ mentality and so it’s been with CEO compensation.
Perhaps we’ve now reached the point the Feds thought we would back in the early 1990s when they implemented the full disclosure rule. The Fed thought people would say “enough is enough” back then but it seems to have taken a worldwide economic depression to wake up the voice of the majority of Americans. Where it goes is yet to be seen because there will be a tug of war between the average American comparing their income to the top earners and the power of consensus as companies vie for the best CEO talent they can find.

Brian, CMCT
influencepeople 
Helping You Learn to Hear “Yes”.

Influencers from Around the World – My Favourite Principles of Influence Used by Online Marketers

This month our Influencers from Around the World guest post comes all the way from Ireland courtesy of Sean Patrick. Sean owns his own sales training company, Sean Patrick Training, and writes a blog, Professional Persuader. We met through Facebook several years ago because of Dr. Cialdini and we’ve maintained regular contact ever since. I know you’ll enjoy what Sean has to say this week.



My Favourite Principles of Influence Used by Online Marketers
The following is a list of my all time favourite principles of influence used by online marketers and how I see them used; the good, the bad and the ugly.
1.     Authority
Marketers use this principle to create a sense or feeling of how the potential customer is in safe hands because they make the prospect feel as though they’ve found someone who has or can demonstrate ability, credibility and proof of concept by knowing the exact pain, dissatisfaction and problem that the prospect is currently feeling. It’s a demonstration of experience by telling a story of how the knowledge to overcome the problem or dissatisfaction came about, the journey of anguish and frustration followed by one “Eureka” moment that just blew the problem apart and facilitated a solution.
Solutions imply success and this is where testimonials come in handy. The marketer will supply oodles of proud and happy customer testimonials which make the prospect’s imagination itch with anticipation. Unfortunately all too often the testimonials are nothing more than cronies and affiliates who have an interest in the product’s success by earning commissions on each sale.
The real heavyweight to this principle is when the marketer offers a cast-iron guarantee or assurance as to the efficacy of the product that the prospect will only ever experience success. This deflects any come back to the marketer by implying that it’s the customer’s problem if they don’t experience the same results as all the other customers.
The last piece of the authority principle that the marketer needs to employ is by bringing in the heavy-weight celebrities, famous affiliates or mentioning some major event they sponsor.  The principle of authority when used credibly creates and confirms expertise, but when done in an egotistical manner it implies “Guru Status.” There is a world of difference between the two and self-appointed gurus are best avoided.
2.   Scarcity (Fake Urgency)
When done properly and all other conditions are met this is the one principle to send a would-be buyer over the edge. It makes them buy, especially when potential customers are spoon-fed the notion that what they are pondering is about to be taken away from them due to two things:
a. Limited stock or supply, or
b. Time limited price offer
Scarcity is often perceived as the one to watch out for because it’s been used over and again, but if all the other principles are used effectively then scarcity becomes the trigger that’s easily pulled. The easiest way this is done on the web is by stating right from the start that what is about to be sold is scarce either because of limited supply or because the guy in the stock room messed up and priced all the labels incorrectly, stupidly at a much lower price so therefore the marketer can’t afford to sell the product at the launch price for an extended period.
The reality is that scarcity is quite often fake and the sense of urgency is false; just a ploy. The majority of products sold on the web are information products so how can something produced digitally be of limited supply? The same rule applies with price simply because no one sells anything at a loss; unless it’s a liquidation sale where all stock is liquidated at low prices in order to pay the exorbitant fees of the liquidator. This why a time limited price offer can be extended and often is when the guy in the stockroom screws up again and finds a ton of stock that was hidden under a polythene cover.
In my opinion scarcity is really powerful when people travel and they see something that is scarce back home but is abundant in the region they are travelling through. But the conundrum is either to buy there and then or to go on the web and buy via direct mail when they get back home. Generally, the window of opportunity is narrow for both seller and buyer and most of the time the tourist will succumb and purchase on the spot.
3.   Reciprocity (Concession)
The principle of reciprocity has been killed to death by marketers on the web. The usual tricks follow the pattern of exchanging an email address in return for some pointless or semi-useful report, whitepaper or mp3 that contains only self promoting messages rather than ready-to-use-instantly-valuable information.
A new wave of reciprocity is to receive an invitation from a marketer to a live web-conference where you can learn X and Y and achieve Z for free. It’s like a 3 for 2 offer. This tactic achieves both receiving the identities and email addresses of prospects that sit at the beginning of the sales cycle and during the lead nurturing process the marketer can choose to offer more freebies of varying scales to the prospect with the aim of qualifying the prospect further. The principle of reciprocity states that I’m more compelled to do something for you because you gave me something first that was both personal and timely.
Prospects will begin to find the marketer as a source of authority through a repetitive experience of this principle.
4.   Contrast
Perceptual contrast is one of the sneakiest tricks that a marketer can play out in the online world. The same tricks that a mentalist employs are played out online all the time.
This principle plays stage to how a menu of prices can confuse and distract and leave the customer financially worse off. Just the like the 3 for 2’s you see in the shops a similar price structure ensures that the marketer is maximizing every dollar from every customer. But the pricing structure can be a lot more complicated if bonus materials and legacy products are offered at supposedly discounted prices.
Just like price, how problems are solved can be distorted very easily by using this principle. Questions a lot of people don’t ask themselves before buying include:
a. What will this product really do?
b. How much time do I need to invest in order to get a return?
c. How does the product really work?
More often than not the obvious gets blurred by the use of other principles melding together that creates dissonance in the prospects mind. This in turn creates a contrasting perception of where they are and where they’ll be in the future but at the same time seeing their potential future self in the present because they’ve convinced themselves to buy the marketers product and now feel a part of a tribe of successful like-minded people. They trust wholeheartedly the marketer to be their sole authority over their problem.
5.    Liking
I like you because you appear to be similar to me because of experience, status, color, race, sexuality, football team, or our stamp collection.  ; )
Liking is powerful because it brings about a sense of trust that is long lasting. We all want to be a part of the same crew, tribe, team and corporation or we like people who value our sense of freedom and independence and therefore feel camaraderie. This tactic is very popular with online marketers who launch membership sites that take in monthly fees or marketers who create pre-launch events that bring together the entire pool of prospects who suffer the same dissatisfactions and allow them to network, mingle and produce fellowships by way of interacting in web-chat facilities, forums and social media sites.  It also goes hand in hand with the social proof principle that facilitates the need to purchase even more because people who we came into friending are buying, and those who bought before had huge successes and you know what they were pretty cool people too and I like them!
Hopefully your eyes are open a little wider now and you can spot legitimate use of certain principles of influence vs. illegitimate use.
Cheers,
Sean

To read about Influential Negotiations on Sean’s site click here.

Customer Service Success = Under-promise and Over-deliver

I was listening to the “Mike and Mike Show” on ESPN radio on the way to work one morning when I heard Mike Greenberg utter a familiar phrase for those of us in the sales arena, “Under-promise and over-deliver.” Even if you’re not in sales you might have heard the phrase before. What you may not understand is why it works so well.

Under promising and over delivering helps make happy customers because you set expectations you should be able to deliver on and that’s the key. For example, does it bother you when you call a customer service number and hear, “Your call is very important to us and will be answered in the order it was received. Right now your estimated wait is five minutes,” and the wait ends up being seven or eight minutes? I know it bugs me.

How do you feel when this happens, “Your call is very important to us and will be answered in the order it was received. Right now your estimated wait is ten minutes,” and the wait ends up being seven or eight minutes? If you’re like most people you feel pretty good…or at least better than you did in the first scenario.

Why is this so? It’s simple. In one case the expectation wasn’t met but in the other it was exceeded. It didn’t matter that in both cases the actual wait time was the same. This is a classic case of “compared to what?” which derives its power from something know as the contrast phenomenon in the study of influence. What we compare something to can make all the difference in our experience.

Most people make the mistake of over promising and then under delivering. For example, a company wants to get a new order and they bid too low only to come back later and raise their price…or try to raise it and anger the customer. They may have gotten the contract but an upset customer will talk to a lot more friends than a happy one so it ends up hurting business in the long run.

Here’s something most of us face on occasion – time away from the office.  When we leave the office we change our voicemail and turn on the out of office message to alert people that we’re away. When I take family time I clearly tell people I won’t be checking voicemail or email but when it’s not family time that’s different. If I’m traveling for business I’m still more difficult to reach so I might us a message that incorporates something like this:

“While I’m away my access to voicemail and email will be limited. I’ll do my best to reach you while I’m traveling but it might be Monday before you hear from me.”

We live in an almost fully wired world where people expect 24×7 communication unless we set a different expectation. When people call or email they’re not thinking about how busy we might be unless we let them in on that fact. My message doesn’t promise the other person will hear from me but when they do I usually get a response along these lines, “Hey, thanks for getting back to me. I know you’re out so I wasn’t expecting to hear from you till Monday.” Do you think they’re happy? You bet they are because I exceeded their expectation. I under promised and over delivered.

I say this often; understanding persuasion isn’t a magic wand that will get you what you want every time. And let me add to that there are always exceptions to the rule. Sometimes there’s the difficult customer who doesn’t care what you’re doing because they want an answer now. For folks like that I always make sure to include in my message a way to reach a real live person in my absence so they can get immediate help when needed.

I love what I do and the company I work for – State Auto Insurance – but I’m not an employee 24×7, nor is work the most important thing in life. I have parameters in my life and to remind me of that my personal mission statement concludes with this – I work to live, I don’t live to work. I’ll never sacrifice my faith, family or personal well being at the expense of my career.

So let me encourage you; set the parameters on whatever you do and remember that under promising and over delivering is the better strategy to take because the science tells us so.

Brian, CMCT
influencepeople 
Helping You Learn to Hear “Yes”.

Influencers from Around the World: Secrets of an Aussie Debt Collector

This month’s Influencers from Around the World article comes to us from down under courtesy of Anthony McLean, CMCT. Like me, Anthony is a Cialdini Method Certified Trainer, the only one in Australia. Reach out to him on Facebook or LinkedIn, or feel free to leave a comment below.

Brian, CMCT
influencepeople 
Helping You Learn to Hear “Yes”.


Secrets of an Aussie Debt Collector

I was recently at a social function where I met a guy who, from the outset, sparked my curiosity. When asked what he did he simply replied, “debt collection.” After a bit more discussion he said something that really intrigued me, “I only work with two types of clients; those who can’t pay and those who won’t pay.

This comment resonated with me because I immediately thought of the complex influence problems we encounter. I thought the most difficult situations often involve a target of influence who believes they can’t say YES or simply won’t say YES.
I probed further into the world of our debt collector and found that he not only ran a very successful business but the more he spoke, the more it became obvious he was intuitively employing all of Dr. Robert Cialdini’s principles of influence in some way.
Of note: Dr. Cialdini originally discovered these principles by watching those masters of influence in a covert manner and then reverse engineered their strategies and validated them through research. Just as Cialdini had done, I quickly realized I was in the presence of an artisan; someone who was effectively employing Abraham Maslow’s fourth stage of learning, unconscious competence. Influence was a part of this guy; he just did it and was successful because of it. We arranged to meet to discuss this further and below are the secrets of a very successful debt collector.
Those who can’t pay
We started off agreeing that those who were happy to pay never made it onto his books so we would commence with those who believe they can’t pay.
Our debt collector (DC) started by saying the introduction to the phone call is critical. He had to be “firm but fair.” DC commences by introducing himself by title and appropriately demonstrating his knowledge in the field. He knows that if he is to influence those who believe they can’t pay he has to get their side of the story in order to understand what happened and, if possible, why. Going too hard will shut them down and that’s not to anyone’s advantage. With the introduction over he commences by getting their side of the debt story and uses this context to start to work through strategies to see how they can start to pay. DC highlights to the debtor that even small amounts are okay and reassures them that others don’t have to know about this situation. This second element is critical because for many “saving face” is integral to the process.
DC says that truthfully telling the debtor that “others have told him that they begin to feel better once they start” often opens the door to further discussions. He stated he highlights that this simple step will also stave off any legal proceedings and will give the debtor time to work through the problem in many respects under their own terms.
DC said that while working through options he avoids putting debtors in a position in which they feel they have to say No”. Once a pathway is identified he gets the debtor to voluntarily commit to a repayment start date and to outline how they will go about making that first payment and the subsequent payments after that.
What DC has found is those who can’t pay are far more receptive after providing their side of the story. This also allows a time and space for him to outline the various consequences and to highlight the options they have open to them. Of course DC said he always finishes by commenting on what the debtor honestly stands to lose by not going down this path, including the widespread attention that is often drawn to public hearings like this.  He’d added his approach is unlike many in his industry and his staff is recruited because of their ability to engage with and talk to people, not just make demands and threats upfront.
During our conversation I was able to quickly note where DC was intuitively using the principles. They were:
·       
Introduce himself with the title of debt collector.
·       
Engage in a very different way to what people expect thus allowing for the contrast to be drawn to other debt collectors and even the debt recovery efforts of the initial service provider.
·       
Providing debtors the opportunity to tell their side of the story and allowing them to do so.
·       
Allowing debtors to make their own choices with one alternatively ensuring confidentiality.
·       
Providing flexibility in repayment options and terms.
·       
Cooperating with the debtor to find solutions allowing for payment rather than making demands.
·       
Genuinely looking at the situation from the debtor’s perspective and letting them know that it was not DC’s job to make this any harder but to in fact help them resolve it without causing further hardship.
·       
By highlighting that others like them have felt better once they commence the payment plan.
·       
Introducing himself by title and organization and quickly explaining the role.
·       
Demonstrating knowledge of options and legislation in the introduction
·       
Carefully ensuring the debtor doesn’t commit to “No” in the early stages thereby taking a stand not to pay.
·       
Getting the debtor to voluntarily commit to a payment plan with a start date and method of payment of their choosing.
·       
Highlight what they stand to lose by this becoming public or by going to court.
Those who won’t pay
DC informed me that as far as those who won’t pay, it’s more a situation in which they often have the capacity to pay, but felt wronged in some way. This could mean they didn’t receive the service or goods they initially paid for or they weren’t told the whole truth about the product and/or service initially. With this history of the service provider under-delivering or failing to deliver, often the debtor has not and will not take proactive steps to repay the debt. In many instances the debtor is happy for the matter to come to a head, such as to go to court, so they have a viable platform to vent their disapproval and highlight the injustice they feel has been perpetrated against them.
At the other end of
this continuum however are those that have learned that if they don’t pay the debt there is a strong chance in the settlement phase the service provider or debt collector will discount the debt in some way to get the debt cleared. Alternatively, if they go to court there is a chance they will have the debt admonished. Either way, by holding out, they “win.”
DC told me that once he identifies someone in the “won’t pay” group he doesn’t waste any further effort and simply serves a summons on them and commences legal action. DC said he does this because history tells him that if they won’t pay they either want their day in court, in which case he gives it to them, or they want to stall on the smallest detail and/or amount to ensure they “win.” Neither of these is worth DC’s time to engage in this lengthy and often non-productive interaction.
DC then stated that in his business only 3-5% of his cases progress by way of summons to court proceedings and almost 100% of this group were from the “won’t pay” sector. Knowing this allows DC to recognize that for 95-97% of his cases, if he or his staff invest time in the debtor and create an environment in which they can work together they will usually get a positive result. The contrast here to others in the industry is evident in that the stereotype suggests that the debt collector will stand-over, threaten or coerce the debtor, making them feel they “have to” repay the debt today and building resentment or resistance.
DC further backed this up with some more statistics saying that when he expanded his business from Australia to New Zealand, by using this approach he was able to immediately achieve a 50% payment of debt level whereas the previous provider could only achieve a 22% repayment rate.
Implications
In any influence situation we deal with three types of people:
1.      Those who are willing to entertain our messages/requests/proposals, or at least willing to engage with us and provide an opportunity to influence them.
2.    Those who reject our messages/requests/proposals because while they may be able to be influenced, they feel they are not in a position to be influenced, i.e., because of organizational structure, financial constraints, perceived conflict of interest and so on.
3.    Those who reject our messages/requests/proposals because they choose not be influenced. Whether it is because the outcome may challenge their status or expertise, they may feel wronged in some way and are reacting against us, or they have surrounded themselves with barriers or obstacles so you can’t actually get to them to influence them.
It is important in any influence situation to do your homework and know as much as you can about the target of influence. In DC’s case this is done partly before picking up the phone and partly while on the phone. What DC shows us though is even for those who think they can’t do something, by working with them, doing the small things well, you allow the opportunity for things to at least be considered and influence to come to play. Occasionally the person we are influencing may ultimately not be able to say YES but they will know the person who can.
For those who won’t be influenced because of choice, culture or organization design, you as the agent of influence need to reflect on the time and effort that will be required to break through the barriers and to ask yourself can you spend your influence efforts better elsewhere. If you engage with someone else, whether it is a competitor, a colleague of theirs or even one of their own influencers and they don’t have a seat at the table, scarcity is a great motivator.
Anthony McLean, CMCT
newintelligence
Changing the way people think