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Archive for April 21st, 2009

Persuasion Through Scarcity And Fear Of Loss

I was a psych major in college which seemed to be the perfect preparation for a sales career.  I believe it was.  To this day I am still intrigued by the psychology of selling which could truly be described as persuasion.

That background helps explain why I found this ManageSmarter.com article completely gripping – Mastering the Psychology of Persuasion.  You will have to read the entire article to appreciate the depth of it, but let me pull out a couple of points.

First one of the set-up questions:

• Are left-handed people more prone to some mental illnesses, accidents, or seeking positions of power?

And from later in the article:

And while these questions may at first appear to have clear yes or no answers, in reality, there are no definable correlations to them. All of these questions have exceptions to the rule. “It depends,” is the best practical answer. And yet, all answers you came up with in your head may have value if you’re in the sales and management profession.

Let’s take a look at some of these questions more closely. With regard to left-handed people and power: George H.W. Bush, Bill Clinton, and Barack Obama are all lefties. Power hungry? Maybe.

Ok, the left-handed piece hits close to home for me since my wife and son are left-handers.  Yet you see the point – discovering the prospect’s correlation is important for persuading them.

Here are the most recognizable persuasive elements we experience in society:

Habitual patterns. Trigger words or fixed action patterns, automatic behavior patterns, and biases help people organize thoughts and actions.
Consistency and commitment. MacDonald’s hamburgers taste the same from Russia to Denver.
Reciprocation. “I love you. Will you buy my guitar?” The person may be more influenced to buy the guitar as a way to return the gesture of the stated love. Guilt falls under this category.
Likeability. We like people like us. First impressions, and all.
Social proof. Everybody is buying, saying, eating, reading, etc., so I must also.
Authority/power. Law is law and rules are rules.
Scarcity. The more we want something and can’t get it, the more valuable it can appear.
Fear or gain. Research shows fear of loss is stronger than the desire for gain.

The last two are critical to successful selling.  Scarcity is a strong motivator for moving prospects through a qualifying process.  The beauty of it is this – it creates demand in the prospect’s mind in spite of the salesperson.  I have seen some grossly under-developed salespeople thrive based on the perception of scarcity of their solution.

Fear of loss is similar to pain.  The same principle applies here – people move faster to remove pain than to gain pleasure.  The importance of this principle cannot be overstated.  This fact is why features/benefits selling is wasted if the benefit does not remove pain or create the fear of loss.  If your salespeople can combine scarcity with the fear of loss in their qualifying, you will have one highly-developed sales team.