Monday, November 23, 2015

Why Thankfulness Matters

This week people across America will be celebrating Thanksgiving. While this holiday has its origins going back to the 1600s with the Pilgrims it wasn’t until Abraham Lincoln that we formally acknowledged the last Thursday in November as the day of celebration. Franklin D. Roosevelt altered that in 1939 when there were five Thursdays in November. FDR declared the fourth Thursday to be the official day and the Senate ratified his decision in 1942, officially making the fourth Thursday Thanksgiving in the United States.

The truth is we should be thankful every day and multiple times each day because there’s so much to be grateful for. If Viktor Frankl could find reason to give thanks while held prisoner in Nazi concentration camps then we can all find reasons to be thankful each day. Unfortunately it’s human nature to take things for granted so it’s not until something is missing that we appreciate it more. That’s the principle of scarcity in action.

Speaking of being thankful, here’s an example of the wrong way to go about it. Many years ago a colleague needed help with something. What was asked not only required my time but the time of several others as well. It forced us to put things on hold for other people but nonetheless we “stopped the presses” and accommodated the request. This person got what they needed and went about their business the next day. What stood out to me was this – never did they thank us in person, by phone, or in writing. I remember thinking, “I don’t work for thanks. I get paid well to do my job,” but I also knew in my heart I wouldn’t extend myself for that person again and I certainly wouldn’t ask others to do so.

I don’t think I’m different than the average person in this regard. When I go out of my way to help someone – even when paid – if I don’t get some acknowledgment of appreciation I know I won’t try as hard the next time. Contrast that with people who offer genuine thanks and appreciation. I bet most of you would go above and beyond for such people.

Giving thanks is a form of reciprocity. This principle of influence tells us people feel obligated to give back to those who first give to them. According to the French social psychologist Marcel Mauss, every human society teaches its people the way of reciprocity. We see this as we raise our children because one of the first things we teach them to say is, “Thank you,” when someone has done something for them.

Because we’re all brought up in the way of reciprocity most people are somewhat offended when the person they helped cannot take a moment to say thanks. Beyond offense, people are less willing to help thankless people as time goes by. It’s a natural human response.

Here’s why thankfulness matters. When you do express sincere appreciate people are more likely to help you – and others – in the future. Think about it; you help someone, they express gratitude, and you feel good about the action you took. You’re naturally more likely to repeat behaviors in the future that made you feel good about yourself. And the person you helped is more likely to help others too. That’s called “paying it forward.”

As we approach the day that commemorates giving thanks pause to reflect and see if you’re someone who regularly gives thanks when someone does something for you. If you don’t, or don’t as regularly as you should, make a commitment to start. I think you’ll be amazed at how people respond to you and you’ll be thankful you changed your ways.

Brian Ahearn, CMCT® 
Chief Influence Officer

Helping You Learn to Hear “Yes”.

Monday, November 16, 2015

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:


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 flipside, 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: 
  1. Coverages – Not all policies have the same coverages and not all have the same coverage limits. More coverage or higher limits means paying more.
  2. 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.
  3. 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.

Brian Ahearn, CMCT® 
Chief Influence Officer
Helping You Learn to Hear “Yes”.

Monday, November 9, 2015

What’s Your Goal?

I work with lots of people in different roles when it comes to teaching ethical influence. Over the years I’ve worked with senior leaders, middle managers, supervisors, claim reps, underwriters, field sales reps, insurance agents, business owners, financial reps and many others. I’m always amazed at how often people try to persuade without a clear goal in mind.

You may think a salesperson always has a clear goal; i.e.,to make the sale. True enough, but that’s still a little vague in my book. Let me share an example to help you see what I mean.

During the Principles of Persuasion Workshop© we have an activity where participants work in teams to come up with a persuasive argument to get a high school student, Jimmy, back in school after he’s been expelled for foul language and insubordination. Participants generally do a good job at applying the principles of influence to persuade the school board to let Jimmy back in but very few clearly state when they want Jimmy back in school. That leaves the final decision up to the school board, which could opt for another week or two out of school.

Participants would do much better to say something like this at the conclusion, “It’s our sincere hope that you’ll let Jimmy back in school tomorrow.” Why is this so important? Because if the board says no there is a moment of power the teams can leverage.

Studies show when someone says “No” to you, if you make a concession and ask for a smaller request immediately your odds of hearing “Yes” are much better. This is an application of the principle of reciprocity because when we give a little, people often feel compelled to give a little in return.

Robert Cialdini had his research assistants run an experiment that shows how powerful this concept can be in real life.  These students randomly asked people around the Arizona State University campus if they would be willing to be a chaperone on a day trip to the zoo for a group of juvenile delinquents. As you might expect, very few people wanted to spend a day at the zoo with those kids so only 17% said they would be willing to help.

At a later date the research assistants roamed the campus and started with a bigger initial request. They randomly asked people if they would be willing to be a big brother or sister to some juvenile delinquents. They made sure people knew this was a weekly commitment of two hours and they were looking for people to sign up for two years. No one was willing to give up that much time. As soon as people said no the research assistants would ask, “If you can’t do that, would be willing to be a chaperone on a day trip to the zoo for a group of juvenile delinquents?” So basically they were asking for the exact some thing they’d asked for earlier but this time 50% said yes – triple the initial response rate!

Two things were at play during the second scenario. First, the contrast phenomenon came into play. By comparison, a day at the zoo is nothing compared to a two-year commitment so it’s much easier to say yes to the zoo after thinking about being a big brother/sister. The second thing was the principle of reciprocity was engaged by way of concessions. When the research assistants counter-offered immediately, many people felt compelled to do the same.

Let’s go back to the scenario with Jimmy. By clearly stating what the team wants – to have Jimmy back in school tomorrow – they will be more effective persuaders. They might hear a “Yes” to the initial request but if they don’t they can make a counter offer that’s very likely to be accepted. This is a far better approach than leaving the timing up to the board.

How does this work for you? Two ways. 
  1. Clearly state what you want. Think about the times when you’ve not clearly stated what you wanted and left if to someone else to decide the outcome. Perhaps you interviewed for a job but didn’t clearly state the salary or benefits you wanted. Or maybe you were trying to make a sale but didn’t make the first offer.
  2. Don’t censure yourself. For example, you want a job and would like to earn $95,000 but inside you’re thinking they might say no so you ask for $85,000. If you hear no then you might end up at $80,000 or less. Ask for $95,000 because you might just get it but if not you can retreat to $90,000 and are more likely to get that than if you’d started at $90,000 or $85,000.

Next time you go into a situation where you’re trying to persuade someone don’t just focus on building your persuasive communication. Give lots of thought to what your ultimate goal is. What would you like to have happen if everything worked out as you wanted? But don’t stop there; clearly communicate your desired outcome. Be ready in case you hear “no,” which means having multiple fallback positions ready. This allows you to leverage the moment of power after “no.” Do these few things and you’re on your way to becoming a much more effective persuader.

Brian Ahearn, CMCT® 
Chief Influence Officer
Helping You Learn to Hear “Yes”.

Monday, November 2, 2015

Ironing out the Buying Thought Process

I’ve been on the road a lot lately. In a recent stretch I was gone Monday through Thursday or Friday four weeks in row. When I returned from a recent trip, my wife, Jane, had gone to Myrtle Beach to spend time with her family. I was left with a daunting task: two-dozen shirts to iron!

But there was a problem; our iron was ruined not long ago when I dropped it on the floor. Before I could start ironing I needed to buy a new iron, something I knew nothing about. I’d like to let you in on my thought process as I made the purchase. I don’t think I’m much different than any of you reading this so perhaps it will help you understand why you do what you do when it comes to certain purchasing decisions.

Let’s start with this fact – the vast majority of our decision-making takes place at the subconscious level. Martin Lindstrom, author of Buyology (yes, I spelled it correctly) contends non-conscious forces drive upwards of 85% of our decision-making. People who’ve been in sales for any length of time understand this and that’s why it’s often said, “People buy based on emotion then justify with logic.”

My first decision was where to go to get the iron. I ended up at Target. I guess I could have stopped by Sears, Wal-Mart or some lesser-known stores but I didn’t even consider them because prior experiences at Target have been good, their prices are reasonable and Target is burned into my subconscious more than the other stores because of their advertising.

After asking a clerk where I could find irons I ended up in front of shelving full of irons ranging in price from $12.99 to $89.99. Immediately I knew I would not spend anywhere close to $12.99 because having some cheap irons in the past and using them at hotels is frustrating. I also knew there was no way I’d pay anywhere near $89.99 for an iron because ironing as little as I do doesn’t necessitate one that would be used in a laundry mat.

As I looked at all the different the models I saw several options from Shark. I’d heard of Shark and seen some commercials and remembered their products seemed unique although I couldn’t recall specifics. Other than glancing at some other brands I really gave all my attention to the Shark models.

As I looked at the Shark irons they did look different than all the others and the price range was reasonable with the low-end model for $29.99 (Lightweight Professional) and the top of the line model for $49.99 (Ultimate Professional). There was one other model for $39.99 (Professional Steam Power).

At this point I did what most discriminating shoppers do – I compared. Did I need 1800 watts, 1600 or 1500? Was the 9.5 inch base, 9.0 or 8.5 best for me? Does it matter that one is 3.6 lbs., 3.3 lbs. or 2.0 lbs.? Decisions, decisions, decision, all of which I knew nothing about.

That led me to one more decision criteria; what do people say about each model? That was easy enough to look up on my phone as I stood in the aisle. Each iron had 4.5 stars, some with more than 100 reviews. I felt comfortable because people just like me (principle of consensus) thought highly of each model so I felt better and better about my potential Shark decision.

With all that going on in my head which model did I buy? I bought the $39.99 model, which is what most people would do. I remember thinking, “Do I really need the top of the line and will those subtle feature differences be worth it?” I also thought, “If I buy the low-end model will I regret it because maybe it turns out a be a little cheap?” The middle seemed to be a safe alternative.

Most companies offer three product models (cars, shoes, bread makers, etc.) exactly because of the thinking I outlined above. Some people will want the top of the line, some will default the cheapest but most people will buy in the middle. If a company removes its high priced model the average sale will drop because some people buy the top of the line but also because more people will shift from the mid-range product down to the lowest priced model. Pay attention next time you’re in a store and see if you begin to notice the three choice offerings.

Although I’m in tune with buying, selling and psychology, I must admit, it was an interesting exercise to really pay attention to what was driving my purchasing decision. I got home and used that iron for three hours as I knocked out all the shirts at once. I must say, I was pleased with my purchase – at least that’s what my mind told me.

Brian Ahearn, CMCT® 
Chief Influence Officer
Helping You Learn to Hear “Yes”.