This is session number 022 of the Influence Psychology and Persuasion Podcast. And this show is all about Behavioural Economics Principles. Well not all about but certainly 3 tips to help you understand what this amazing study has to offer.
So, Behavioural economics are sets of psychological studies all around economic decision making. So, if you buy or sell things, this podcast is for you. And if you are involved in marketing, sales and run your own business, this is most definitely for you.
As you're listening to this you will already have a clear understanding that we, humans, are anything but clear or easy to understand. We're odd, we make irrational choices, decisions and statements.
I remember a few years back and my wife came home one Saturday in January. She walked through the door, beaming with pride, came into the living room where I was reading a book, hands at breaking point with carrier bags with a red sale logos splattered all over and held them to my face. She then blurted out "You wouldn't believe how much money I've saved".
Interesting, I though. She wouldn't have bought anything if it wasn't January sales and the fact she had 25+% off. She felt like she'd saved money. Lol.
My wife isn't the only reason for these studies. We all make irrational choices at times. Here are 3 studies to arm you going forward.
Tip Number 1 - FREE!
Now most of us get this. FREE is like a drug which pulls us in for closer inspection. FREE has a magnetic pull that us mortals can't resist. But is this logical?
Forget for a moment that now days we may have been abused by the power of FREE. Most of use will think, but what do you what in return if not money? The science shows we have an unreasonable connection to FREE!
An interesting study was carried out. Researchers offered participants a choice of 2 chocolates. The choice was either a 1 cent Hershey's Kisses or a 15 cent Lindor chocolate truffle. Most of the participants opted to pay for a 15 cent Lindor Truffle because they could see the amazing value, when compared to the Hershey's Kiss.
Here is the interesting part though, when the researchers dropped the price by 1 cent, the vast majority then opted for Hershey Kiss. All because it made it FREE! The word FREE makes us unreasonable. Watch out, or use it to your advantage.
Tip Number 2 - Perceived Value
You all know what we like right? We're not persuaded by price, at all. We simply understand what's good and what's not!
The research says we are more likely to admire a bottle of wine if it is priced considerably more. Interesting, this means we may perceive quality based on price.
Here is the bones of the study. The members of a Wine Club were invited in to taste and rate 5 bottles of wine, based purely on what they liked. Here's the sneaky part, there were only 3 different wines. 2 of the wines were in 2 bottles. Haha. However each bottle was only noted with a price label. Nothing else, just price.
Only, there were actually only 3 different wines in those bottles– two wines had two bottles each. Each bottle was marked only with the price tag and nothing else. The prices ranged from $5 to $45 for the same wines and the other ranged in between. So, the $5 wine was also marked at the top price of $45.
There was a clear correlation with the ratings of the wine and the price label. You guessed it. The $45 bottle of wine was rated the highest even though it was the same wine as the $5 bottle.
Here's 2 more examples of how price effects your decision making.
Prozac the anti depressant, was tested against a placebo. In this study they sold the placebo at a price of $2.50 per pill and the real Prozac pill at $2.00. Strange but true, the higher priced placebo out performed Prozac.
Even more disturbing, students were given a caffeine and sugar drink and were told this would help them improve their alertness and cognitive abilities.
But, half of the students were asked to pay full price for this while the other half received a huge discount... The results. The students who received a discount solved 30% fewer puzzles.
This study has been done time and time again in many studies and they all deliver the same results.
Tip Number 3 - Priming
Simply talking about a particular attribute will cause people to make a decision based on how they are primed.
A very simple study was done in a computer store where people who were looking at Laptops were asked 2 things.
The first group were asked how much memory they were looking for, and the second group were asked what processor they wanted. You guessed it, those who were asked about processor purchased a laptop with a high spec processor, and the buyer who were asked about memory chose a new machine based on it high level of memory.
A similar study was done in supermarkets. People who were walking down an aisle with yoghurts and fruit were stopped and asked A: whats your favourite fruit and the other group, whats your favourite yoghurt. You can guess what happened by now for sure. Those who were browsing the aisles ended up buying those products they were asked about.
This is session number 21 of the Influence Psychology and Persuasion Podcast and this show is all about how leaders can become more influential by utilising these nonverbal tips. Below are 7 keys areas leaders can become aware of to ultimately become more
This is session number 020 of the Influence Psychology and Persuasion podcast. This session is all about how we can be influenced by the the power of touch. Beware of the power of touch. So, the power of touch. Babies and children reach out for their moth
This is session number 019 of the Influence Psychology and Persuasion podcast. This session is all about how we are influenced and persuaded by authority and authority figures. So, how are we influenced and persuaded by authority figures, and how can we
This is session number 018 of the Influence Psychology and Persuasion podcast. In this show, I'll be sharing some information on Metaphors and Influence, explaining how they are being used to influence you and what you need to be aware of to use your own metaphors more effectively. I have been away from the podcast for a while, as I have been chasing my tail with a new full time role and kids school holidays and all that Jazz. I was out walking the dog this morning in the woods, and I came across a large flat area right in the depths of the woods. Standing there I was faced with six different paths, all of which were brand-new to me and I didn't really know which one I wanted to take. What I did know though however, that whatever path I took would definitely have its own twists and turns and new things for me to discover. The last paragraph in itself was a metaphor, a metaphor about me deciding today what the podcast should be about. I was in fact walking the dog earlier in the woods, and I was contemplating what to do today's podcast about, I did know that it would involve some research on some more discovery to fill in all the pieces. I decided on this, Metaphors and Influence.
This is session number 017 of the Influence Psychology and Persuasion podcast. This show is all about understanding the impostor syndrome and how it affects us. If you don't know already, the impostor syndrome is a feeling that we get whenever we feel not worthy.These impostor feelings can be subdivided into three separate categories.
The first is basically feeling like a fake. You know you have a little niggling inside that you're about to be found out by someone. Perhaps you're surrounded by others who you feel are more knowledgeable or skilled in certain areas, and you feel your time will come up very soon. Statements from people who feel like this would be things like "I just give the impression that I'm way more competent than I am" or even "I know that one day I'll be found out that I lacked the knowledge that those around me have".
The second part is the inability to own success and to wrap it up as just being lucky. This is something that I'm sure all of us have done at one time or another. Someone may be praising a success or something that we've achieved, only for us to announce it as a fluke or that the competition at that time wasn't up to par either.
The last category is fairly similar to the second and this is also discounting success. This is where a person really downplays the successes that they have had. "I don't know why you're making a fuss" or " anybody could have done it".
Different variations of impostor syndrome will show for most people during their lifetime in many different areas or situations. It's extremely common though with highly achieving, highly successful people this is what separates impostor syndrome from simply low self-esteem. Impostor syndrome comes from the discrepancy of big achievements and the person not taking ownership or playing down the result.
This is session number 016 of the Influence Psychology and Persuasion podcast. This show investigates how humans are motivated. Are you playing to your own strengths and do you understand what drives you the most? Statistics and human nature dictates that we are far more likely to make a decision if that decision eliminates either FEAR or LOSS. Examples: Your boss asks you to work another 2 hours on Wednesday evening. If you do this you will earn another £20! Feel motivated to do this? Most of us would base this on whether we needed that additional £20, but how about you boss saying if you don't work on Wednesday evening you'd lose £20 per week from your salary? Think about that for a moment! Changing banks and utility suppliers is a very common one. Comparison sites show you what you can save if you shift, but add that up to what we may lose as a result of changing. What are the Risks associated with changing, what's the hassle that you will have to go through? Car insurers don't tend to have this issue as this is more accepted as a simple process. 1-2-1 therapy, business coaching and performance coaches all talk in terms of the big goal and what you want to achieve. Creating the compelling outcome and that will give you drive for the journey. However, history and psychology tell us a much different story. The truth is, we are far more motivated to take initial action to get away from fear, pain, and anxiety, than we are for achieving a goal or getting a reward. Take a look at this from Usain Bolt "