Marketing revolves around the concept of “perceived value”. People are more likely to purchase your products and services, when the value they assign to your offer outweighs the price tag. (We all know that, right?)
However, it seems that men and women are very bad in estimating value. So let's further dive into psychology and pair it with math. Don't worry!
Dan Gilbert explains it using simple examples. He presents research and data from his exploration of happiness — sharing some surprising tests and experiments that you can also try on yourself. Watch through to the end for a sparkling Q&A with some familiar TED faces.
This is part two in my mini-series about psychology for marketers.
No matter if you offer a standardized or custom made product, are you sure that your customers knows what they will get? Very often your customers and your business will rely on implied assumptions that can be quite the opposite of what the other party believes.
As a professional business person, you will have to find your way to avoid embarrassing situation and make sure that your customer and you not only speak the same “language“, but also mean the same.
You might have heard about the chain of communication:
mean ≠ say
say ≠ hear
hear ≠ understand
understand ≠ accept
accept ≠ do
There are 5 possibilities that the communication between 2 people produces unexpected, unwanted results. It goes well beyond what has been said. It can start out with a customer, who cannot articulate properly what he means, and end with a company delivering something the customer does not want. Some companies are arrogantly thinking, “We know it better than the customer, anyway. He'll love it.”
Avoid those risks altogether by making sure the expectations on both sides match objectively.
A fictional story
A chain of communication between a small business owner (BO) and a Web design firm (WD) could go like this:
BO thinks he wants a Web site, because he has read about a competitor, who has launched a Web site successfully and his sales sky-rocket. But he is also afraid of spending too much money on the Web design firm. However, he is convinced that once he has his Web site, his sales will go through the roof as well.
BO says: “Well, I want a small Web site to promote my store. Nothing fancy.”
WD hears exactly the same. There is no distortion in audio here.
WD understands: “BO wants a small Web site. He doesn't want to spend a lot of money on it.”
WD accepts: “I don't offer him additional packages. If I tell him, that it costs money or that it takes time till a Web site becomes profitable, he probably doesn't order the design from me. Well, I need his business now.”
WD delivers a small, nice Web site. That's it.
BO did not think about promotion for the Web site. He thought it is sufficient to have a Web site in order to get more sales. WD on the other side was afraid of offering more.
If you think the Web designer was a little bit unfair, I agree. He simply could have asked BO how he is going to promote the site. There would have been room for additional business. BO does not even know the basics of Internet marketing.
The conclusion of this short story is that both parties, customer/prospect and the business representative should ask a lot of questions and give honest answers. In the case of a standard product load (but don't overload) the sales page with detailed information and answer objections a prospect might have. Of course keep it benefit driven as much as possible. Actually I stop here, because this not not a course in copy writing.
It's in the human psychology that everybody is a bit selfish. Marketing and sales experts rephrase it as a question.
“What's in it for me?”
Everybody is constantly asking this question in all sorts of situations.
in family situations
in personal relationship
We tend to act only, if we perceive that there is enough value in it for us.
However, it turns out that there are people, who are more giving than others and vice versa. It is interesting to note that success with an Internet business is highly correlated with the giving mentality of the entrepreneur. I actually don't have any data at hand to backup this claim right now. But it's the essence of the teachings from successful Internet marketers that I follow.
Okay, what's in it for you today?
I want to serve you — my readers and email subscribers — better. I want to give you
Articles and infos that better suit your needs
and I will answer the best questions here on the Blog.
That's in it for you. Interested?
Here is what I need you to do. Leave a comment here on the Blog answering my 2 questions. The 3rd question is optional, but I appreciate any answer on that, too.
1. Pick 3 topics or subjects that you would want me to cover on this Blog on a consistent basis.
2. What is the single most important question you have about your most important topic (from question 1)
3. Optional: Just 1 or 2 sentences, please. What's your situation, why are you reading this Blog or my Newsletter? Are running or starting out with an Internet business? Are you a manager in a corporation?
You have time until
Tuesday, December 18, 2007, 3 pm PST (Pacific)
which is 23:00 UTC (London)
The comments will be moderated, your privacy is assured and you cannot get distracted by the questions of others. I will answer or will have your questions answered next week.
Thanks for your participation and, please, prove that you — my readers — are action takers.