The Brainy Business | Understanding the Psychology of Why People Buy | Behavioral Economics

Did you know that the sense of sight has a huge impact on your business? About a quarter of our brains are involved in visual processing. This behavioral economics podcast is all about the sense of sight. I share the surprising truth about what percentage of the body's sense receptors are in the eyes and why our subconscious is so visual and the impact that has on our businesses. This is the beginning of a series on the five senses – beginning with sight and moving through sound, touch, taste and smell (not necessarily in that order). I am starting with sight because it is the most powerful of our senses by far and the things I am going to share with you in this episode are going to just blow your mind. CLICK HERE FOR YOUR FREE DOWNLOAD! Show Notes [14:48] There is so much more to know thank you think about the sense of sight and how it absolutely impacts your business. [15:23] I'm beginning with sight, because it's the most impactful. About a quarter of our brains are involved with visual processing. [16:05] About 70% of the body's sense receptors are in our eyes. This is why our subconscious is so visual. [17:11] Is vision in your eyes or in your brain? [17:24] The sense of SIGHT takes place in the eyes. It is all the little bits of information coming into them. But Vision? Vision does not actually happen in your eyes. VISION is in your BRAIN and is much more complex than simple sight. [17:56] Vision is actually built on expectations in the brain based on past experience. [18:39] The sense of sight is bringing in a lot of stimuli it can't actually interact with – light, color, contrast – in a big flood of information all the time. The process of INTERPRETING that information is a task for the brain. [20:30] When we present our product data for our business, people's brains will fill in the gaps and tie things together. [21:47] Inside the retina are photoreceptors – perhaps you have heard of the rods and cones in your eye. They are shaped differently (hence their different names) because they do different things: rods are sensitive to dark versus light and cones are sensitive to color. [22:57] Color Illusions can trick the brain into thinking that it sees a different color. [24:30] FOCUS Our eyes interpret information with the highest resolution in the middle. [26:19] Impressionistic paintings were styled because of diseases in the eye. Monet's early work was full of blues and purples that were absent in later work. Brush strokes became thicker, because he had cataracts. [28:07] Degas developed retinal disease at the age of 36, and he could not be in intense light. [28:38] When we see a Monet or a Degas you still know what the images are. Our brains piece together what they are looking at based on prior experience. [29:33] Our brains are actually conditioned to see and pick out faces. This can either be to see predators, or understand allies. [30:14] Being able to focus forward is what creates our depth perception. This is why optical illusions and a drawing on a flat sheet of paper can look three-dimensional to us. [31:47] Binocular disparity is this state of two eyes pointing in the same direction from slightly different spots (test it by looking at objects through different eyes and watch how they appear to move). [33:03] With 3D images one side is red and the other side is blue (cyan). With 3D glasses, one side takes in each color making things appear three-dimensional. [36:02] Our brains are constantly scanning and interpreting information. We scan the world around us three times every second. [37:02] This is why priming impacts behavior and ads have impact on people even though they say they don't watch them. [37:42] Our brains take things in but don't alert the conscious brain unless there's a reason to. [38:17] Remember vision is in our brains. We have evolved so we can focus on one thing while constantly scanning our environment. [38:45] Saccades are why things like flip books work – our brain weaves together a stream of basically still images and connects the missing pieces. [40:24] When the actor on camera is supposed to be watching something go from one side of the shot to another, they need to actually watch someone (or something) go from one side to the other so the camera doesn't pick up their eyes darting all over the place. [41:52] Our brains need to deploy selective attention to only flag the conscious brain of what matters. [46:58] What is reality? Do we all live in the same reality? Or is my reality different from yours? [48:20] Miscommunications come up often because we are unwilling to believe that our way is not the only way and that multiple people and perspectives can still be right. [49:18] Our brains can often attach meaning to all sorts of things when they aren't there. [51:26] Our brain mostly thinks in images and emotions and processes them constantly and basically instantaneously. [52:00] When it comes to your brand and business it is worth investing in great images. DO NOT u

Reciprocity is the perfect topic to talk about this time of year. Today's behavioral economics podcast is another foundations episode, and it's all about reciprocity. I explain how our brains process gift giving and why we often give reciprocal gifts of higher value than the original gift. I talk about how reciprocity can be used in your business and how it relates to generating leads. I also share insights into Sheldon's theory of reciprocity on one of my favorite shows The Big Bang Theory. I talk about how our subconscious really feels about gift giving, three ways to use reciprocity in your business, and more. Show Notes [10:07] Ways to use reciprocity in your business. [10:23] Reciprocity is what happens when someone gives you something (whether you wanted it or not, whether you really value it or not) and you feel obligated to give them something in return. [11:37] One thing I really appreciate about The Big Bang Theory (and Sheldon in general) is how they apply complex scientific concepts in ways that they are funny and relatable (although a little extreme of course) [12:22] Sheldon says, "I know you think you're being generous, but the foundation of gift-giving is reciprocity. You haven't given me a gift, you've given me an obligation." [13:22] In reality, our brains overestimate the value of the gifts we're given and overcompensate. [13:47] Tips go up when customers are given a mint with their check. The gift of kindness and a little effort goes a long way. [16:50] The subconscious feels obligated to pay back for gifts it receives and it often gives back more than it received. [17:10] Reciprocity presents itself in many ways. I'm going to talk about three main categories: the free gift, the small ask on the path to something bigger, and the big ask to get something more realistic. [17:22] The free gift is like mints or a lead magnet or the free content I put out on my blog and podcast. [19:15] The Brainy Business is about providing strategy to make messaging more effective and impactful. I've had many listeners reach out to me about partnering after listening to my show. If you're interested, I'd love to hear from you too! [20:20] Free samples are also great for things that are a little obscure. Samples have another benefit of dopamine release with anticipation. [22:56] The free gift of a sample for something that people might be hesitant about trying (but you know is amazing) is a great double whammy of reciprocity and the dopamine release with anticipation. [23:06] Reciprocity and free gifts are often used when asking for donations. [25:35] Some other examples of "free gifts" are sales or discounts. Sales and discounts need to be offered strategically and not as a crutch. [28:02] I share a quick story of how giving out gum made my high school life a little bit easier. [29:46] My friend Nikki Rausch, Your Sales Maven, has written several books on relationship selling and she speaks on this around the country. One of her tips is to be of service to other people. [30:39] A small ask to get something bigger. Giving someone a button and a yard sign is more likely to influence them to vote for you then just asking for the vote. This is because of the escalation of commitment. [33:06] When asking for a donation cold turkey, there's a good chance they will say no. Asking someone like a store owner to put a small sign in the window will actually influence them to donate to you. [34:34] This is because of the "foot-in-the-door" technique which creates a small shift in the way a person thinks. [35:26] This is also why loss-leaders work in business. [37:19] You start with a BIG (and somewhat ridiculous or unreasonable) ask to make the thing you actually want to ask for seem more reasonable and appealing. [39:27] An example of using a big ask to get volunteers on a college campus. [42:41] One obvious place to use this is in negotiations of any kind. This concept of reciprocity is why you hear concepts like "give and take" or that people are expected to "meet halfway." [43:46] An example from money coach Mikelann Valterra on how to pick a "resentment number" when pricing client work or bidding projects. [46:44] I have always been one to reward people who ask for things (my own version of reciprocity). It takes a little something extra to step away from the norm and ask for something outside the status quo. [48:52] So here is a GIFT FOR YOU: Anyone who commits to six strategy sessions before the end of the year, instead of $499 a piece, they will be $450 – so you will save almost $300. And you get priority space on my calendar, which fills up pretty fast these days. [49:23] If you commit by the end of the year to 12 strategy sessions in 2019, I will do them for $400 apiece. That means you will save almost $1200! That is two free strategy sessions plus some gravy cash in your pocket. Interested? Let's chat. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, p

This behavioral economics podcast is building on the most recent foundations episodes to really dig into the power of habit. Last week I really went deep into what habits are and how they work. Today, I am going to share a bunch of examples of ways businesses use habits to their advantage (and how you can too!) I talk about how advent calendars can actually build anticipation and release dopamine. I also discuss clever ways that Starbucks keeps customers coming back. I talk about how 95% of purchases are habitual and how this habit formation can be combined with reciprocity and loss aversion. I give several examples from big companies and my personal life. Then I break it all down so you can apply the same principles to your business. CLICK HERE FOR YOUR FREE DOWNLOAD! Show Notes [11:36] Last week on episode 21, you learned all about what makes habits so powerful and the best way to form a new habit (either for yourself or in business). [12:11] Advent calendars are a staple of the holiday season. [12:59] Some big manufacturers have found a way to boost their sales before the holidays (and probably increase the likelihood that their bigger toys will be the focus of the big day). [14:10] A LEGO City Advent Calendar will generate interest in Legos all the way up until the holiday. [14:35] The excitement about what is going to be inside, and getting to see the next one...building anticipation... That is where the real enjoyment is for the brain. Once it has opened the box? Dopamine release stops. [15:15] You are also creating a habit of opening a gift every day! The brain wants to keep getting those small toys for the dopamine. [15:55] Is there something your business could do to incorporate advent calendars with your clients or customers? [16:52] The Starbucks app helps create the habit of coming back. They have also Incorporated loss aversion and integrated the power of habit into their app. [18:05] Be careful what lines you cross when it comes to knowing your customer, you may be inadvertently offending some people (like their set up that I can only get bonus stars by buying items I am allergic to). [18:57] They've also done the same thing with their treat receipts. Where you can get a discount in the afternoon. [19:26] Scarcity can become a habit if it is ingrained in who you are. Costco shoppers have the ingrained mindset that they better buy now because the item won't be there the next time they visit. [20:33] 95% of purchases are habitual. [21:15] Daily active users are important for apps. You get bonuses each day in a row that you play. This is a combination of reciprocity, loss aversion, and habit - and it works very well. Our brains love it. [22:53] The most common "problems" solved by habits (the reward in the brain) are STRESS and BOREDOM. [24:48] KIT KAT was having a sales slump. They paired Kit Kats in the consumers' mind as something that goes along with their break. Tying in with coffee and breaks made it so when people think "coffee" they think "Kit Kat". [26:42] Availability was also used in this campaign. [27:29] McDonald's hired a research team to increase milkshake sales. They discovered that people were hiring the milkshake to prevent their boredom on the way to work. [30:40] The research found out what was causing the habit and then made it really easy for more people to take up the habit. [31:06] You have to ask the right questions to get the right answers. [31:42] If you find people using your product in a way that you didn't intend, that creates a new opportunity to market. [32:17] The cycle of habits. You want to use the cue/reward part of the habit cycle, not the craving/response part. [33:14] "If you lived here, you'd be home by now," is a genius marketing and a good way to break the habit cycle and try to form a new reward option. [34:23] Payment habits. Every time you pay the mortgage and don't look for another provider, you are habitually rebuying that loan. [35:07] Breaking the payment into very regular, small amounts, makes it easier to keep paying and doesn't flag the brain negatively. [36:50] You get a renewal notice and your premiums have gone up a little bit. Suddenly that large yearly payment is something that prompts you to shop around for more affordable services. [37:41] Being on auto pay is easy and becomes a habit. [39:10] If you work on appointments, you should encourage a regular day and time for people to come in. People like to feel like they are important. [41:16] A pre-scheduled appointment can become an EXPERIENCE that you will pay more for. [42:38] When you can make it a habit and preschedule for people, it makes it less likely that they will break that cycle. [44:09] "Be seen to the point people don't remember the space without you." Jen Mueller of Talk Sporty To Me [44:43] Many people including my friend Debbie Page say that the key to networking is showing up. [45:53] Engage with people on social media and selflessly share their content. This can make your

Habits are much more powerful than most of us realize. This behavioral economics podcast is about habits and habitual buying. It is another one of my behavioral economics foundations podcasts. When a lot of us think of habits, we focus on bad habits, but we actually have more good habits than bad. Our subconscious does about 99% of the brain's processing and this applies to habits and buying habits. I am going to break this down for you to make sure it is super applicable for your business – including the different strategies you should use if you are the market leader versus someone trying to break in. They are very different! I also talk about how businesses make the mistake of focusing on what's new instead of the habitual buying habits, and how you can use buying habits to improve your business and marketing. CLICK THE IMAGE FOR YOUR FREE DOWNLOAD! Show Notes [09:00] The subconscious brain does about 99% of the brain's processing. [09:41] If 99% of decisions are made using these automatic rules, based on the way things have been done in the past and what has worked…clearly a lot of the buying decisions you (and your customers) make must be done automatically. [11:01] Even with infrequent purchases, the place you go and look is based on habit. [11:50] An association in the brain that triggered an action (or a desire to take an action). That is essentially all a habit is. [12:17] The human brain essentially works on many, many associations. [13:29] Your brain sorts through tons of information and concepts – all the things it is NOT looking for until it finds what it is looking for. [14:49] In reality, 95% of all buying decisions are HABITUAL. Far too many companies and brands are focusing on the 5% - the "new" and "different" and "getting people to consciously make a decision and change" than working on being in the 95% of habitual purchases. [16:33] What is a habit? The official definition is "a settled or regular tendency or practice, especially one that is hard to give up" [18:23] Maltz, a plastic surgeon in the 1950s noticed it took about 21 days for his patients to get used to their new noses. [18:48] His book Psycho-Cybernetics said, "These, and many other commonly observed phenomena tend to show that it requires a minimum of about 21 days for an old mental image to dissolve and a new one to jell." [19:15] NOTE: He said a minimum of about 21 days. [20:28] Our brains have a habit of using the 21 days as a reference even though there's a mountain of evidence against it. [20:54] We have been attacking habits wrong. [21:55] A 2009 study from The European Journal of Social Psychology found the average number of days it took to form a habit (in their case it was eating fruit at lunch or running 15 minutes a day) was 66. [22:17] This is where framing can kill you. You hear an average and think great that's the number. [22:40] There are more questions that you need to ask. Such as what was the range of days when coming up with that average. The range for this study was 18 to 254 days. [24:57] Essentially, all habits are made up of four phases: Cue, Craving, Response, and Reward. [25:41] The human brain is driven by rewards. [26:24] A cue is a signal to the brain that there is a reward around. And that instantly leads to a craving. [26:50] Cravings can be hard to ignore. It can quickly become all your conscious brain can focus on. [27:03] When you give in to the craving and the brain gets the reward, you have a double whammy because you have just reinforced the original cue to make it even more powerful the next time. [27:42] The thing we have done WRONG in addressing habits in the past is to try and change the response. [27:59] If you want to change a habit or start a new one, the CUE and REWARD phases are where it's at. [28:44] To help stop doing something you need to find the cues that encourage you to do it. [29:27] Cues have been found to fall into one of five categories: Location, Time, Emotional State, Other People, and An Immediately Preceding Action. [29:53] List the ques of each category by asking yourself questions. [31:00] We actually aren't craving the thing we think we are craving but the reward that it provides. [32:16] Ask what the reward is that your brain is seeking. [36:22] "No, I can't drink soda…" Or, the very subtle difference of, "No, I don't drink soda." [37:38] "I can't" is not your choice. It is instead a restriction. "I don't" is empowering. This was your choice. It affirms the choice you made and makes you feel determined, full of willpower. [40:09] By turning off notifications and eliminating the cue, I can work longer and be more productive. [42:19] You don't want to mess with people who habitually buy your product. You can create cues with product placement. [44:04] It's possible to lose a habitual buyer by offering them more choices and triggering them to think about other brands. [45:47] Brand leaders shouldn't do too much to rock the boat. [46:36] Jones soda has a large cult

This behavioral economics foundations podcast episode is about defaults.Today's episode on defaults is going to absolutely blow your mind. You may think you know how defaults work, but you will not believe how they impact you, your business, and really everything. It's amazing. You probably don't realize it, but defaults are everywhere. Basically, every choice has a default. Think of the default as what happens if you do nothing – or if your customer does nothing. More often than not, when presented with a series of options people will go with the default. Listen in to learn how critical it is to consider the default option, complexities of choice architecture, and more. Show Notes [16:44] You probably think you already know all you need to know about defaults, but I'm going to blow your mind today. [17:26] Every choice has a default. Doing nothing is a default. People often go with the default, and this is connected to status quo bias. [18:32] People are more likely to keep things the way they are – maintaining the status quo and not take an action to change things. [18:56] In business when you are presenting options it is CRITICAL that you consider what is the default and what will be more likely to be chosen. [19:09] This is getting into Choice Architecture, which will be the focus of a series of episodes as it is very complex – I had a whole class dedicated to the topic of Choice Architecture in my master's program. [19:37] Defaults are the way our brains really showcase just how lazy they are. This is where all the "should's" of the world come to die. [20:41] An example of default retirement savings. Options 1 and 2 leave defaults that are consistent with past behavior instead of considering the future. [23:29] Option 3 is have people commit when they are in a cold state to commit some of their future earnings to retirement. This is an easy commitment for the brain to make because of time discounting. People are also less likely to opt out than they would be to opt in. [24:27] 78% of people opted to use this program when it was offered to them. [25:33] This is a really creative solution that could be applied in many other areas to help people to have better lives. [26:04] Too many programs and approaches are trying to get people to change their natural tendencies. [26:26] When push comes to shove the subconscious is the one making the decisions. [26:53] You can't tell your subconscious to not be subject to defaults and status quo bias. [27:37] An example of defaults and how they impact you. This one comes from Kahneman's Thinking, Fast and Slow. [28:35] If you make a bet and come up wrong, but everyone else did too, you are much less likely to be ridiculed than if you went against the herd and made a losing bet no one else made? [31:15] If people make a choice and step away from the status quo (the doing nothing) and lose…they feel increased regret. [32:02] In your business, is it the default for your customers to do business with you? Or are you asking them to change their behavior to buy? [32:40] Consider subscription services to anything in the world. The act of turning off the auto-renewal or canceling the subscription would require taking an action. [34:37] Setting up automatic payments for mortgages, insurance and auto loans are defaults that benefit everyone. [35:20] Make it easy for people to opt out if they want to. [36:02] Most people will not put in the effort to cancel, but you want to make it so they don't WANT to cancel. [36:17] What sort of service can you provide that includes a regular, automatic payment to you as the default? Is there a way to make buying from you the default? [37:58] Most people use the default settings on their computers. It's better to be able to go with the recommendations of the people who built the thing. They know how it works best and if anything doesn't suit your style you can always change it, right? [42:18] A badly placed default can make people want to get out of everything and completely change their habits. [43:01] The ethics of choice and defaults. There is a lot of debate in behavioral economics about the right way to use defaults and choice architecture. [43:12] Is it our responsibility to help people with a well-placed default? [43:45] You want to make it so people still have a choice. Make sure people aren't harmed if they go with the default and give them the option to choose something else. [44:31] Add in some sensible defaults if you have a complicated product or service. Most people will choose a pre-selected option. [45:00] What is presented first is also more likely to be chosen. [45:19] People now need to make a choice to opt into overdraft protection. This goes against the status quo bias and most people won't do it even though it is in their best interest. [46:18] How do you choose what is best for most people? [46:57] 95% of people support organ donation but only 43% are signed up as donors. You have to opt-in to be a donor and that is why

Herding is the topic of today's behavioral economics podcast foundations episode. This concept is similar to the way animals herd and for many of the same reasons. For safety, being in the center of the herd offers protection from predators. There is also an assumption that if everyone is running in the same direction they must know where they are going. My husband and I just got back from a trip to London, where I observed examples of herding, the subconscious versus conscious brain, and how a nudge can remind us to do what we need to. (I will talk expand on nudges in my upcoming foundations of choice architecture series). During this episode I will give examples of how to use herding to your advantage in business, and how herding can go terribly wrong. Show Notes: [06:23] Crossing the street in London is an example of the subconscious brain versus the conscious. Cars come from you on the right. London gives tourists a nudge by painting "look right" and "look left" at the intersections. [08:10] In behavioral economics we expect people to make errors, there's just too much going on for the brain at one time. A little nudge can help us when we anticipate an error. [18:19] Humans herd in the same way as other species – including wasps and schools of guppies – for much of the same reasons. [18:43] It's beneficial to be as close to the center of the herd as you can. [19:30] running the same way as everyone else is another concept of herding. A great example of this is watching groups of people cross the street at a busy intersection. [22:01] One of the reasons our species has adopted herding is because it helps us learn by observation. [23:26] The childhood discomfort of not doing what everyone else is doing is fueled by our basic instinct of herding. [24:29] In addition to safety, herding is a key way that we learn. Learning by observation is critical to our survival and growth. [25:48] Choosing a full restaurant as opposed to one that is completely empty is an example of herding. [26:55] Seeding a tip jar with money is another example of herding. [27:35] Museums in London had giant jars of cash encouraging people to donate. [29:09] Herding mentality is more likely to come out when people feel vulnerable or unsure of themselves. [30:58] Herding behavior can come into play with finances and when your reputation is on the line. [33:02] Studies have shown that up to 75% of participants will give an answer they KNOW IS WRONG to go with the group. [33:27] It takes strong will and conscious focus to be willing to go against the group and it is even more difficult when those people are like you. [34:45] Herding is one reason that things go viral. [35:57] In finances, people being afraid to go against the cumulative advice of the herd is one reason why markets crash and bubbles burst. [37:46] Crypto is absolutely impacted by the herd mentality – we see people make millions and feel more optimistic we can have that same fate if we act fast! This is also incorporating the concept of availability. [39:08] Don't let herd mentality force you into making a bad decision. Turn on your conscious brain when you feel the anxiety building. [39:44] An example how you could use herding and the power of numbers to get hotel guests to reuse their towels. [41:52] People like to be part of the group. This is increased when the people are comparable and more similar to you. [42:54] Any time you can provide reassurance through numbers, it will increase the chances of people buying. [43:39] Herding and the ice bucket challenge. People participated because it was less painful to do it than to be ridiculed for not doing so. [45:20] Being in a group makes us feel safe and happy because of this release of oxytocin. [45:57] Helping leaders build a following. Recognize the power of existing affinities. Encourage the formation of new affinities. Fight the herd instinct in yourself. [48:55] Derek Severs How to Start a Movement is one of my favorite Ted Talks. [51:38] Social media is rife with herd mentality. Most people do not want to stand out by leaving a comment. [53:53] The feeling of getting comments and shares on social media can release oxytocin. [54:37] You can use herd mentality as an advantage in business by being generous with your social likes and shares - an example of a challenge I am currently participating in. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show. Links and Resources: Dramatic Incompetence and the True Story of an NFL Tie The Making of Harry Potter Harry Potter and the Cursed Child Episode 1. Unlocking the Secrets of the Brain Nudge: Improving Decisions About Health, Wealth, and Happiness Debbie Page Business Bros Podcast Human Herding: How People are Like Guppies The Unwisdom of Crowds Herding, social influence and economic decision-making: socio-psychological and neuroscientific analyses He

Our brains can be primed to lean toward a thought or word or number. Today's behavioral economics podcast is another foundations episode, and it is all about priming. I share examples of how easy it is to trick the brain into thinking and answering something wrong with just a little priming. When primed, your subconscious remembers it recently heard a number, or a statistic or something and that influences the next assumptions it makes – even if they are not even remotely related. I share examples of priming, research and studies related to priming, and examples of how you can use this concept to grow your business and profits. CLICK HERE FOR YOUR FREE DOWNLOAD! Show Notes [09:28] I share a rhyme and a question that shows an example of priming. Rhyming can be one way to prime the brain. [11:11] Our brains will hear a number and then adjust up or down from there. This is another example of priming. Especially, when done intentionally like the examples I gave in Episode 11. [11:34] Our brains are lazy and incredibly busy, so they take shortcuts all the time. [11:48] Our subconscious brains need to make snap decisions. When primed, our brain will make assumptions based on the previous word or number that it has heard. [12:18] I was giving a presentation to a group of female entrepreneurs (something I do a lot!). I asked everyone to think of the last 2 digits of their social security number. Then assign a value to the necklace I was wearing. Those with lower number socials assigned lower values, and higher numbers assigned higher values. This is the power of priming, the root of anchoring and adjustment. [14:10] A priming example, where sales of Snicker bars were increased just by using the number 18. [14:39] Limiting the number of cans of soup that someone can buy actually primes them to buy more. [14:57] Priming can also be done with words. A priming example where students primed with words about elderly people actually took longer to walk to the elevator. [17:30] They also did a study with rude and polite words. People primed with the rude words were much more impatient and likely to interrupt. [19:17] A stereotyping example of priming. Priming people with words from a certain stereotype can actually affect the results on a math test. [21:19] Prime yourself for success. If you doubt visualization, think how easily the brain can be primed. [21:55] The power of visualization. There is a reason why Olympians train their brains as well as their bodies. [22:48] Mental training may be even more important than physical training. [22:59] The steps the visualization. [23:01] 1. Know what you want. Ask yourself what you would like to see if nothing was holding you back? [23:15] 2. Describe your vision in detail. [23:28] 3. Start visualizing and create the emotions. [23:41] 4. Take daily actions. [23:58] 5. Have grit and persevere. [24:27] Priming with physical objects. Participants in a study were asked to hold a cup of either hot or cold coffee. People who held the iced coffee actually rated the person in the story as being much "colder" than the hot coffee participants rated them. [26:03] Participants in another study were more likely to clean up crumbs after a snack when there is a faint hint of cleaning products in the air. [27:09] Several studies have been done where certain objects or smells will affect people's behavior. [27:48] The takeaway from all of these studies is that everything we do and say matters. Whatever was said or done right before we do or say something also matters. [28:34] You can't control everything, but it is worth looking into the things that you can control. [29:25] Remember, what comes first matters much more than the price itself. [30:25] With these priming examples, small things and a few simple words can make a huge difference. [30:54] If you find people are always rude when they talk with you. Or treat you like you are cold and distant. It could be a bad prime. [31:25] A study where participants were shown a flash of a logo for an imperceptible 30 milliseconds. Participants shown the Apple logo were more creative than participants shown the IBM logo. [32:15] Participants shown a Disney logo were much more honest than participants who saw the logo for E! [32:23] Have you ever heard people say you become like the people you spend the most time with? Or that you should dress for the job you want? Or that you should "fake it till you make it"? [32:36] It seems there really is some truth to that. You are priming your brain to take on the traits of those outside influences. [32:55] Prime your brain in a way that you want to be approaching your day in your life and business. [33:14] Notice how quickly a brand is noticed. Ask what the traits of your brand are? [34:21] These things may not register on a conscious level, but they have an impact, even if people don't realize it. [35:03] Marketing and advertising takes dedication and focus; consistent presence and messaging to break through the

I take framing one step further and talk about the power of numbers in today's episode. This behavioral economics podcast will be a break from our foundation episodes. I get in to some of my most frequently asked questions (including ending prices in 99 or 97). I also talk about pricing strategies like using random or "interesting" numbers. I share research, examples, and how you can apply framing using numbers in your business. Before I dig in, I want to thank Justin from 52 Card Media, Jesse from Cinematic Syndicate, and Jennifer of Jennifer Findlay Portraits for making the website look so awesome. I have also transitioned to a new YouTube Channel and all the full episodes of this podcast are on it. Feel free to subscribe and share it with your friends. Show Notes [09:17] Last week was all about the concept of framing. Today, we take that concept one step further by unlocking the power of numbers in your business. [09:45] The way you say something is often more important than what you're actually saying. This ties back to loss aversion (which was the focus of episode 9) - remember framing something as a loss makes people twice as likely to take action than when it is framed as a gain. [11:21] I talked a little bit about pricing and Episode 5. All of the things leading up to the price matter more than the number itself.[12:16] Is it really better to end something in 99 than rounding up to the nearest dollar? Should my prices end in 99 or 97? Should I have a random, but interesting number like 456.78?[12:55] It's (generally) better to round down in the 99 versus one dollar question. This works because you're bringing down the first whole digit number. 599 looks better than 600. [14:24] Consistency is key. If you list your prices and have them one on top of the next, and they say, 399, 499, 999 and 2500 it is just weird. [16:27] The great debate of 99 versus 97 (or even 95). Any of them are typically better than the rounded 0 because of the first digit difference. [18:21] The LAST question on pricing is about using totally random and sometimes "interesting" numbers. This would mean instead of pricing something for $4,600 or 4,599 you would price it at $4,567.89 (so when you look at it the number reads 456789.) [19:09] Making someone stop and say "what?" can be good if you're trying to disrupt the buying cycle. [20:50] Journal of Consumer Research study called "This Number Just Feels Right" states that luxury pricing or other things bought on emotion (like a bottle of champagne) sold better when it was priced at $40.00 instead of $39.72 or $40.28. [22:01] In another study on the pricing of a camera, participants favored the rounded prices (leisure/luxury/emotional purchase) and the non-rounded prices when they thought it was for a class project (function or looking for a deal). [22:32] Bringing it back to FRAMING: the mindset that someone is in when they are going to buy from you matters. [23:26] Confidence helps you sell and encourages people to buy. [24:08] Statistics and numbers can be very persuasive when presented properly. They can also be negatively persuasive when presented wrong. [25:16] Numbers help your brain value things and make comparisons. Which helps it to make a decision without flagging your conscious brain. [26:22] Look for numbers in your business. People like to be part of the group and that is a big reason why framing in numbers matters. [27:51] We make assumptions based on the numbers we see. [28:49] Statistics like this work because people want to be like everyone else. [29:39] To know what works best, you need to try different types of numbers. [30:18] Four out of five has a better context in the brain than 78%. [32:24] "Most" sounds better than 50%. You can also try to flip the framing the other way. [33:42] Find a number in your business and look at all the different ways to present it. Let me know what works best for you. [40:30] Episode 18, is back to behavioral economics foundations – when we will talk about priming. You won't want to miss it! BE thoughtful. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show. Links and Resources: 52 Card Media Cinematic Syndicate Jennifer Findlay Portraits Katie Goulet Website Design on Instagram Sagar Jadhav on Instagram Episode 4 Questions or Answers Episode 9 Behavioral Economics Foundations: Loss Aversion Episode 5 The Truth About Pricing The Psychological Difference Between $12.00 and $11.67 The Buying Brain: Secrets for Selling to the Subconscious Mind This Number Just Feels Right Episode 16 Behavioral Economics Foundations: Framing Episode 8 What is Value? Episode 13 Adjusting Your Mindset Episode 12 Behavioral Economics Foundations: Relativity Find Me Gluten Free Biz Chix Episode 10 On Air Strategy Planning Session with Mariel Court CoastHills Credit Union

Framing is one of my favorite behavioral economics podcast topics. In the past few weeks, I have covered foundational topics like loss aversion, anchoring & adjustment, relativity, scarcity, and availability. Today, I talk about one of my favorite concepts which is framing. Before digging in, I'd like to give a shout out to Lara Currie who left a stellar Apple podcast review and invited me to be on her podcast Difficult Happens. Our subconscious brain evaluates everything very quickly and uses assumptions to make decisions. If you think of this in the context of framing, this is the reason an inexpensive print will look expensive in a nice frame and cheap when taped to the wall. Framing also works hand-in-hand with the concept of loss of version. If you frame something as a loss someone is more likely to take action on it than if it were framed as a gain. In this episode, I dive into how our brains interpret framing and how these concepts can be applied to your business. CLICK HERE FOR YOUR FREE DOWNLOAD! Show Notes [12:21] An easy way to think about framing is thinking about how a beautiful frame impacts a picture compared to no frame at all, or a cheap looking frame. [13:53] Think about a poster on your wall stuck up with tape as compared to a nice print in a beautiful frame. [14:44] Why does the frame matter? It's because our brain processes everything very quickly and uses assumptions to make decisions. A well-placed aesthetic means it must be a high quality piece. [16:24] Children's artwork put in a frame looks like amazing beautiful art. [16:52] To our brains, what we say is not as important as how we say it. [17:18] Our brains process nonverbal communication. All of this other stuff makes a huge difference. [17:40] The nail salon example from episode two was an example of being too literal. They had an outdated sign that sent a negative message to our subconscious brains. They were able to turn this negative into a positive just by changing the wording. [21:34] Framing is at the heart of the concept of loss aversion, which was the focus of episode 9. [21:48] Framing something as a loss is more likely to get someone to take an action than framing it as a gain. [21:59] The motivation of a loss is twice as powerful as the motivation of a gain. This is also called Prospect Theory. [22:58] Examples of framing coming into play. A food labeled as 90% fat free is more attractive than one labeled as 10% fat. [23:22] This is actually saying the same thing, but the way it is framed or what we hear makes one option sound better than the other. [24:09] Last week, I talked about the US open. Saying "Serena lost" has a different connotation than saying "Osaka won." [24:52] The frame of our story and our experiences shapes the world that we live in. Framing is about what we say and who we say it to. [25:47] When talking to clients, I focus on "considering the ripples." [27:36] Tversky did a test on his colleagues at Harvard medical school, having them read statistics about two treatment options for lung cancer – surgery or radiation. [28:35] People choose options that are framed in a positive light. [29:26] One other fantastic example of framing from Tversky and Kahneman is called the "Asian disease problem." [31:42] The principal in this story is called OPTIMISM BIAS, and it will be a topic of a future podcast. [32:22] The three different categories of framing: Risky choice, attribute framing, and goal framing. [34:18] . Have you ever heard commercials for Chevron with Techron? We assume that Techron is something valuable, but it's actually a name that Chevron made up. [35:33] Think back to episode 11 on Anchoring and Adjustment, when I asked you if there are more or less than 10,000 emperor penguins in Antarctica. The same way your subconscious assumes I must know something about populations, your brain assumes brands must know something more about gas. [36:56] Ford calls itself "America's best-selling brand". That's actually an empty claim that sounds good. Yet, it means something to your brain. [38:06] An example about "AVG DAY CARE". Is this a good name? [41:21] Next week I'm going to dig into the science of choosing the right numbers and how to use statistics in your messaging. [41:48] If your toothpaste is recommended by 4 out of 5 dentists, does that mean 1 in 5 dentists don't recommend that toothpaste? [42:56] Some of the most misleading terms in real estate and what they mean. Cozy mean small. Charming means old. Convenient location means loud. Etc. [44:25] This is also getting into the concept of PRIMING – which is going to be the topic of episode 18. [44:41] The way you explain something sets an expectation and can impact the way someone feels about the whole experience. [46:05] All the adjectives included into a description could be considered the frame. [49:08] When I worked at the credit union our biggest competitor claimed they were "a member owned, not for profit credit union" even though, that is b

Today's behavioral economics podcast is about availability. This is another foundational episode that ties in to last week's episode about scarcity. Similar to the bond between anchoring & adjustment and relativity, scarcity and availability can often be found together. There is also a free worksheet available for download that will help you apply today's concept in your business. What do sharks, cows, toilets, buckets, and air fresheners have in common? They are part of the interesting concept of availability. Our brains get lazy and decide the likeness of something happening is based on how easily we can think of an example of it happening before, or how much we have heard about it. Listen on to hear how these random things work together, and for more interesting examples of this concept and how you can apply them in your business. CLICK HERE FOR YOUR FREE DOWNLOAD! Show Notes [06:05] Availability is about how easily something comes to our mind. [06:38] What comes to mind when I say the word shark? [07:32] What comes to mind when I say the word cow? [08:05] Even though, most people are afraid of sharks. There is less than one shark-related death in the US per year, but there are 22 deaths by cow. [09:41] We fear sharks more than other things that actually cause more harm or deaths because of availability. [10:18] The only time we hear about sharks are when they are attacking people. These examples are easy for our brain to remember, and we assume they happen more often than they do. [11:12] Our brains categorize cows as less dangerous. In spite of the actual statistics. [12:07] Daniel Kahneman dedicated chapter 12 of his book to the concept of availability. [13:52] With availability, our brain swaps out questions at hand with questions that we would be more likely able to answer quickly. [14:32] With availability it's about how easily examples come to mind. [15:31] Personal experiences and examples are more available than statistics. [16:16] Our subconscious brains love stories. [17:56] Your social media strategies should support what you are doing in your business. Use social media to gain a following in other things, not in the platform. [18:37] Do you know what movie increased tourism in Norway in 2014? [19:22] Norway had to cut their tourism budget, because they were overflowing with visitors. [20:49] In 1997, the sales of Mars Bars went up significantly (even though they did not change their advertising at all). This was because of the Mars rover. These are examples of how our brains associate things with each other. [21:47] When it comes to availability in your business, you need to associate your business with things that are going on around you. [22:57] In last week's episode, I gave examples of scarce items that flew off the shelf (from Starbucks, Disney and more). They were associated with things that were already popular at the time like the color rose gold. [26:10] Currently, a lot of people are talking about Nike and the Kaepernick Campaign. [28:16] In episode 4, I talk about one of my favorite books called A More Beautiful Question. I reference combinatorial thinking, which helps you get more ideas by combining things together that others may not think goes together. Instead of connecting A and B try to connect A and Z (or better yet, A and 26). [29:41] HARO is a website that connects reporters with potential sources. I reach out and respond with my unique perspective (sometimes it might seem random, but that is often better!) and I have been quoted in some articles. [32:38] Last week, I promised to revisit the story of how diamonds became the powerhouse that they are today. Diamonds actually aren't that rare. Diamond engagement rings didn't become popular until the 1940s. [35:42] De Beers had to create an illusion that diamonds were forever. [38:24] Young men had to view diamonds as an expression of love. They then used movies and magazines to reinforce this perception about diamonds. They also stressed the size of the diamonds. [40:22] By 1941, the advertising agency was able to increase the sale of diamonds by 55%. The sale was based on an idea of the eternal value of a diamond. [42:53] De Beers and diamonds is the original availability case study. They changed the face of the entire world forever. [43:23] Diamonds became a piece of our culture without us even realizing it. [44:37] They also did solid research into the mindset of the consumer and found new ways to get their message out. [45:23] Watch conversations and look for the right time to interject yourself. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show. Links and Resources: Episode 4 Questions or Answers Episode 11 Behavioral Economics Foundations: Anchoring and Adjustment Episode 12 Behavioral Economics Foundations: Relativity The 10 Behavioral Economics Concepts You Need To Know (And How To Apply The

Fall is a favorite season of mine and probably a favorite season to many of you. It's also the time of year that my favorite honeycrisp apples are available. Like cotton candy grapes, these apples benefit from scarcity. Today, I break down what scarcity is and how you can apply this concept to your business. Scarcity is another concept in my lessons on behavioral economics foundations. Traditionally, scarcity is when an item is limited, but there is unlimited desire for that item. When we see something as scarce, we perceive that it has higher value. In today's behavioral economics podcast, I will share stories and examples of how scarcity affects perceived value and how it relates with other foundational concepts like loss aversion. CLICK HERE FOR YOUR FREE DOWNLOAD! Show Notes [02:27] I love the fall, baking, and apple season. [03:12] My favorite apples, honeycrisp, are only available around certain times of the year. These apples have the benefit of scarcity, and that is what this episode is all about. [03:36] In today's episode, I break down what scarcity is and what happens in our brain when we perceive that something is scarce. I also give a lot of examples on how to implement this tactic in a business like yours. [06:00] Scarcity occurs when an item has limited availability, but unlimited demand. This includes resources like oil and water or more abstract resources like time. [06:22] We see things as more valuable when they are less readily available. [06:52] With a watch advertisement, people were actually willing to pay 50% more when they thought that the watch was scarce. [08:01] The most valuable stamp in the world, the British Guiana is valued at $11.5 million! [08:23] The first silver dollar printed and issued by the US government (called the flowing hair) sold for $10 million at auction. [09:32] Scarcity and value are closely tied together and for some reason our crazy brains think less is more. [09:38] Scarcity also triggers loss aversion. When something is scarce, we don't want to miss out on the opportunity to get it. [10:48] Examples of big brands using scarcity that you can use to apply in your own business. [10:51] Costco: People stock up when shopping at Costco, because they know that the great deal they find won't be there when they go back. Costco also has a great return policy to eliminate people's fear of making these purchases. [13:01] Starbucks: Right now it is time for the pumpkin spice latte. A drink made famous by Starbucks. Scarce items take on a life of their own. @theRealPSL even has its own Twitter account. [15:19] Scarcity can create cult followings which means other people do the marketing for you. [17:45] From rose gold Starbucks tumblers to rose gold Minnie Mouse ears, scarcity encourages items to sell. [18:40] These examples are a combination of scarcity and availability which will be the topic of next week's episode. [20:22] Real estate: Scarcity is implied. You can use words to trigger scarcity, such as limited time, extended, custom, handcrafted, one-of-a-kind, and close out. [21:21] There is value with holding firmly to specific hours. When you are booked you are booked. [21:52] When enforcing your hours, you need to say it with confidence. I talked about this in last week's episode about mindset. [22:51] If you aren't selling a product yourself, you can still you scarcity by putting on a contest. [24:07] The holidays are full of examples of scarcity. There are limited holiday treats, black Friday sales, and usually a big toy of the season. [25:26] When using scarcity think exclusivity instead of cheesy tactics. [25:50] Diamond engagement rings. Diamonds actually aren't that rare, and large diamond engagement rings weren't that popular until the 1940s. The concepts of scarcity and availability work together to make diamonds what they are today. [30:29] The diamond example is fascinating, and next week I will talk a lot more about it. Basically, they used scarcity to create perceived value. [32:49] You can book a strategy session with me for 10% off if you book by September 30. That 10% discount also applies to the workshop in Seattle on October 24. [34:08] I will be giving my Consumers Are Weird talk at the Arkansas Bankers Association Mega Conference in Little Rock next week - will you be there? [34:38] I will also be in Portland, Maine in a couple of weeks. Email [email protected] if you would like to connect. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show. Links and Resources: TheBrainyBiz on Instagram Episode 2 The Top 5 Wording Mistakes Businesses Make The 10 Behavioral Economics Concepts You Need To Know (And How To Apply Them)What is 'Scarcity' Influence: Science and Practice (5th Edition) Narcissists as consumers: The effects of perceived scarcity on processing of product information Episode 8 What is Value? The Top 1

Mindset is something that everyone struggles with from time to time. Whether you are experiencing a lack of confidence or stuck with an "imposter syndrome" mentality, you have the power to change your mindset. Offering a new service, raising your prices, or entering a new market can all be triggers that can set off mindset issues. Today, I talk about how behavioral economics plays in, and how you can adjust your mindset by overcoming a couple of aspects where your brain is contributing to mindset problems. I talk about vicious/virtuous cycles, the confidence/competence loop, and how to shift your outlook. Of course, this episode features research and real life examples to help cement the concepts of this behavioral economics podcast. Show Notes [03:16] Everyone struggles with mindset issues occasionally. [03:32] Imposter syndrome is when you feel like a fraud. Experts estimate that 70% of people have felt this from time to time. [04:05] You could also have a lack of confidence around pricing or your offering. [04:23] I'm going to help you create a simple shift to break out of mindset problems. [04:39] A vicious cycle is where you get stuck in a downward cycle. Your brain fixates on small problems and makes them seem bigger. [04:58] There is also a virtuous cycle. This is good piling upon good. [05:15] The confidence/competence loop is a great example of this. [05:28] Confidence matters when it comes to sales. Being confident is what closes deals. [05:49] As you get more confident - you gain competence. [06:16] A real-life example of this virtuous cycle is when you increase your pricing and get so comfortable sharing that increased price that you are saying it like you are saying the weather. [06:49] Practice in the mirror and say it out loud until you really begin to own that price. [07:05] You need to do this because your buyers subconscious brain will pick up on the slightest hesitation. [08:03] I talked a lot about mindset in episode 10. I shared a story where I was hired as a reservation agent at Alaska Airlines when I was 18 years old. [08:42] My training was extensive. This job prepared me for the future. When you quote someone a price it doesn't matter what that price is. And it doesn't matter whether you would be willing to pay that price or not. [11:00] You need to sound confident and say that price as if it was nothing. My confidence could greatly impact the close rate for the airline. [12:04] A price is a price. I would read my script over and over all day. [12:29] Say it with a smile and wait as long as it takes. I was outwardly confident and calm. [13:22] At my first agency job, I learned how to quote high hourly rates. Always remember that you are worth your hourly rate. It was chosen for you for a reason and never doubt your worth. [16:22] You need to feel like you are worth it whenever you walk into a pricing situation. [16:43] The behavioral economics of mindset specifically around anchoring & adjustment and relativity. [17:32] Do not set the wrong anchor. We are exposed to more content in the social media world. [17:56] Don't think you can't launch until you meet some minimum standard. [18:22] Don't set your anchor against people who have been in business for a long time and have a giant team of people. [18:41] People who have the money to create a lot of content also have the money to create a lot of ads. This is why you are constantly seeing their information. [19:24] Reset your anchor and adjust down to a level that you and your clients can accept. [19:59] What are you presenting to the world while you are waiting for perfection? [20:31] The small steps approach applies to mindset, as well. [20:46] It's better to take one small step today than to sit and dwell on the big picture. [21:44] If you are taking small steps, relative to yesterday or the day before you are doing awesome. [22:52] I want to help you adjust your anchor to be on the reality of what you are doing instead of on what other people are doing. [23:33] When in doubt look to Dr. Seuss. [25:02] I love helping clients, and working with an expert can be the jumpstart you need to get unstuck. Remember - 10% off virtual strategy sessions and the October Workshop are only available through the end of the month. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show. Links and Resources: Episode 12 Behavioral Economics Foundations: Relativity Episode 11 Behavioral Economics Foundations: Anchoring and Adjustment Yes, Impostor Syndrome Is Real. Here's How to Deal With It Cognition and Performance: the Relation to Neural Mechanisms of Consequence, Confidence, and Competence Episode 5 The Truth About Pricing Episode 10 On Air Strategy Planning Session with Mariel Court 37 Dr. Seuss Quotes That Can Change the World

Our brains use relativity to make comparisons when assigning value. Relativity is one of my favorite concepts and part of the behavioral economics foundations. Today's show builds upon last week's behavioral economics podcast on anchoring and adjustment, because these two concepts are closely aligned. Relativity is all about value. In this episode, I dig deep into relativity to make sure you really understand what it is. Then I get into all the examples for varying industries and circumstances, so that you can apply this concept in your business. I also talk about how to increase sales by creating three offerings. Show Notes [07:00] Last week we talked about anchoring and adjustment. I also mentioned relativity several times in the behavioral economics podcast, because the two concepts are very much aligned. [09:59] In behavioral economics, relativity is about value. [10:50] How relativity applies to value. Our brains make comparisons to assign value to things. [11:54] When it comes to value everything is relative. Just like in the grilled cheese example (episode 8), we know that $200 is a high price for a sandwich because we can compare it to other things. [12:11] Our brains are constantly making comparisons between items. Even though, those comparisons aren't always the most logical. [12:25] A simple example on how relative values can shift. [13:49] The will to save $15 depends on the item it is attached to. The difference between saving $15 on a dollar item and a $500 item is relative (but it shouldn't be). [14:45] How people will drive across town to save on gas. Even though, the savings may not compensate for the time and expense of driving across town to purchase that cheaper gas. [16:58] An example of how silver medalists aren't happy with coming in second. [18:40] How to incorporate relativity in a retail shop. [18:59] Anchoring and adjustment works together with relativity. An example where seeing a $99 t-shirt when walking in a store makes the real price of the shirts seem much lower even though it may be higher than last year's price. [20:28] The purpose of the $99 shirt is to make other prices look low. [21:44] An example of how setting an expensive espresso machine next to another one will help it sell. The high anchor makes the other pricing look more affordable. [23:22] Three option pricing advice. Offer a best thing, something similar but worse, and something completely different. [23:50] I share how this worked in my online strategy session in Episode 10 On Air Strategy Planning Session with Mariel Court. [24:30] In the earring comparison example, find a favorite color or birthstone to create a comparison example. Have a slightly more expensive pair that is more than double in size. This uses relativity to show the better value. Also include a completely different pair that is at least the price of the best pair. [26:07] When given three choices most people will pick the middle choice. [26:09] A furniture store example. Start with the most expensive option and work your way down. You want to set a high anchor not a low anchor. [28:10] A real estate example by Dan Ariely. [29:09] We like to make decisions based upon comparisons. Even if those decisions aren't rational. [30:10] Including a decoy will help create a point of comparison. [30:52] An example of the value of relativity from The Economist. Using relativity to sell subscriptions. [32:29] How removing an option that no one buys makes sales go down. This is the power of relativity in action. [33:46] When setting prices consider the decoy. If you are offering a service, look at the packages you are offering. Have a great value and a worse value and then a completely different product. Your brain wants to feel like it completed the due diligence to make the best decision. [35:58] An example of how a high priced bundle actually made another high-priced offering seem affordable. [37:22] A diet example that compares calories burned to calories consumed. You have to run 50 minutes to burn off one can of soda. Finding the right point of relativity can help encourage healthy behavior. [39:43] Hopefully you can see ways to incorporate relativity into your business. [42:19] Be sure to tune in next week for one simple mindset adjustment that will change your life and business forever. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show. Links and Resources: Stacking Your Team Episode 11 Behavioral Economics Foundations: Anchoring and Adjustment The 10 Behavioral Economics Concepts You Need To Know (And How To Apply Them) or text BRAINY to 345345 Einstein's Theory of General Relativity Episode 8 What is Value? Episode 5 The Truth About Pricing There is no silver lining: The hilarious pouts of the Olympians who went for the gold - but wound up in second place The Relativity Mind Trap: How Comparisons Can Lead Us Astray Predi

Today's behavioral economics podcast is another foundational episode focusing on anchoring and adjustment. My last foundational episode was Episode 9 - Behavioral Economics Foundations: Loss Aversion and even though it has only been out about a week, it has been one of my most popular episodes to date. You listeners know one of my all time favorite studies features anchoring and adjustment, and it is also one of the main concepts in my signature talk Consumers Are Weird. In business, anchoring and adjustment can be used to help influence the subconscious brain to lean toward a certain number. Skillfully using this concept to persuade someone to agree to a higher or lower number or quantity can close sales, increase conversions, and help in all kinds of negotiations. In today's episode, I give business examples in several scenarios including a jewelry store, furniture store, real estate, car sales, multi-level marketing, service companies, non profits, and more. Show Notes [05:58] This is the second behavioral economics foundation's episode. The first one was about LOSS AVERSION, and it was super popular. [07:14] Today's foundational topic is ANCHORING AND ADJUSTMENT. [10:21] One of my all-time favorite studies is on anchoring and adjustment. This is one of the main concepts in my signature talk Consumers Are Weird. [11:06] When your subconscious brain doesn't know the answer to something that takes a guess. [11:24] As our brain processes at 11 million bits per second, it is using these judgement calls a LOT to guide you through your day and life. [11:50] Our brains are all about shortcuts.When we are given an anchor number, it will influence our guesses. [15:00] I share a story of having listeners at a presentation I was giving think about the last two digits of their social security number and then estimate the value of my necklace. The results demonstrate how anchoring and adjustment work. [16:56] These anchors only work if they are entered into your mind right before the question is asked. This is called priming (a focus for a future foundations episode). [17:14] My favorite study selling Snickers bars. The sales were increased by 38% when the number 18 was used instead of the word them. This was anchoring and adjustment at work. [19:46] Limits also affect the amount purchased. A limit of 12 doubled the amount purchased. [21:11] I was featured in a back to school shopping article on highya.com and warned about watching out for quantity discounts. [21:28] Seeing an expensive item when you walk into a store can anchor your brain to think that the same items for less money, even though they are still expensive, are a good deal. [23:09] How to apply anchoring and adjustment in your business messaging. [23:29] JEWELRY STORE In a jewelry store. Using too low of an anchor can be a mistake. If you give a low starting number, it will become the anchor. [25:26] Instead, start with the most expensive item, then what the average customer spends and then say there are many options under a certain number. [26:37] REAL ESTATE With big-ticket items like homes, you're already working with a number that is unrealistic and often too low. This is what someone wants to spend. [27:08] The buyer needs to disconnect from that number in their mind to be realistic with the current prices. [27:15] When comparison shopping, start with the most expensive house on the list. [28:17] If you are driving with the client, drive through the most expensive neighborhoods. What you show them (or what their subconscious sees and notices) and what you say matters. [29:13] FURNITURE OR OTHER STORE You can use the same tactics if you work in a store. Be mindful what you walk the customers past. [30:34] CAR SALES Selling something with a lot of options and features. You can 1) present a baseline model and all of the additional options to choose from or 2) present them with the top of the line vehicle and let them add or delete features. People will buy more expensive vehicles and packages when presented with the second option. [32:14] MULTI-LEVEL MARKETING Present the most expensive item first and work your way down. Incorporate bundles and give people the option to remove what they don't want. [33:37] SERVICE-BASED BUSINESSES I had two different people in service-based businesses recently implement my advice and have amazing results. [34:32] Using anchoring and adjustment changed Dawn's business. She created a $20,000 bundle (at no cost to her) and now her $10,000 products are flying out the door. [35:58] These simple brain tricks can help women entrepreneurs (and everyone else) make more money without really doing any additional work. [37:45] INSIDE A COMPANY Big numbers being thrown out can impact you. Mentioning an anchor number even if it is not the number that is going to be used will influence the value of the final decided upon number. [42:33] LOW ANCHOR These low anchors can be helpful, but you need to be absolutely sure the claim is true

In this behavioral economics podcast it is time to apply what I have been talking about in the first 9 episodes through this very first on air strategy session, featuring my guest Mariel Court. Mariel is someone I met in the BizChix Coop (which is Natalie Eckdahl's Facebook group). We started a conversation when Mariel posted about rebranding her business. I have a background in branding and wanted to be a resource for her, so we became accountability buddies. Today, we showcase what incorporating behavioral economics into your business looks like. We ask questions to get at the core of what Mariel really wants. This is a real conversation in the form of a virtual strategy session. Mariel is the owner of Gypsy Moon Piercing (a body piercing and fine jewelry studio in Medford, Oregon). Today, Mariel shares her two biggest issues which are changing her name and talking about pricing. We focus on pricing and I provide recommendations incorporating behavioral to frame the issue. You can find Mariel Court here: Gypsy Moon Piercing Facebook PageGypsy Moon Piercing on Instagram@gmpiercing on Twitter Show Notes [05:48] Melina wanted to be a resource for Mariel, plus she was going through her own rebrand. [06:18] An on air strategy session showcases what incorporating behavioral economics into your business can look like. [07:15] We ask questions to find out what Mariel really wants. [07:36] This is a real process with no boxed solutions. [08:23] When someone books a virtual strategy session with me, it is conducted via a recorded video chat, which I provide to the client after the call for added value. [08:44] Mariel Court is the owner of Gypsy Moon Piercing, a body piercing and fine jewelry studio in Medford, Oregon. [09:03] Mariel's two biggest issues are the name change for her business and talking to people about pricing. [09:22] Sometimes Mariel feels that she is apologetic when explaining pricing to people, but it is also expensive to run her business. [09:56] She charges a $35 fee plus the cost of jewelry. Gold starts at $70 per piece. [11:34] Gold is handcrafted and a lot more can be done with it. [11:56] When buying gold jewelry, it will probably be more in the $150 to $200 range. [12:06] In the world of anchoring and adjustment when people hear "starting at $70" they will think the price should be $70 (or less). [13:29] Mariel feels she loses about three quarters of the phone calls that are about pricing. [14:45] Getting the caller to answer personal questions may be a better approach than talking about pricing right off the bat. [17:05] After finding out what the caller wants, recommend something more affordable like silver colored jewelry to keep the cost down. [17:57] Parents want to know that someone is going to take care of their kids. Put the parents and the kids at ease. [18:58] Use the person's name and pick out some jewelry that they may like. [21:56] We had a key turn in the conversation. Mariel's concern was talking about pricing, but it became clear that it was more of a mindset issue about how she approaches the pricing discussion. People ask about pricing because they don't know what else to ask. That is relativity which I talked about in episode 5. [22:38] The subtle shift of talking about value instead of price (covered in episode 8). [24:41] The value Mariel provides is with her impeccable taste in jewelry and her experience and how much she cares about people. Her reviews show this. [25:51] If you say the price apologetically, people will think you're overcharging them. [29:35] People buy on emotion. You want them to fall in love with the product before you ever talk about pricing. [31:23] Piercing could be a special day for moms and their daughters and become a really important memory. [33:55] Mariel does more jewelry sales than she does piercings. [34:21] She has an active Facebook group even though it's only three months old. [35:38] Choosing whether to focus on kids or adults and building an experience around that focus (pick a niche/avatar). [37:44] KEY POINT: Selling the experience as opposed to selling the price of the jewelry. [39:50] There are things that Mariel can do to make her customers feel special, like having a stuffed animal for the kids which would be included in a "princess package." [41:14] The subconscious relies on emotion. Find the things that make them want to come in before they even visit the shop. [43:33] Once people have committed to a certain package, Mariel can show them upgrades, and they will feel like they are only paying the difference. [43:59] I would love to hear what you moms in the audience think about the suggestions we talked about. Would you pay more for the "princess" experience? Let me know in the comments. [44:35] KEY POINT: Incorporating behavioral economics into your business doesn't have to cost a lot. There are small things that can make a big difference. [44:47] Look at the brain's natural decision-making process and find the right way to

Because this is a behavioral economics podcast, it is time to build our behavioral economics foundations. This is the first in a series of episodes where I dig deep into one concept at a time. Previous episodes have been about problems and concepts in business. Such as The Top 5 Wording Mistakes Businesses Make and The Truth About Pricing. Today's concept is loss aversion. When speaking about behavioral economics loss aversion is usually the first concept I introduce, and it is a great starting point for this podcast. In this episode, I share a cool study of how loss aversion works and then highlight the concept with several examples. These include examples from financial institutions, businesses coaches, interior designers, accountants and more. I also share how these examples can be used in your business. Show Notes [06:08] Building the foundations of behavioral economics. This series will have a lot of concepts. [06:30] There will also be more problem statement episodes mixed in along with a new exciting format that I'm introducing. [06:50] Loss aversion. The first concept I bring up is always loss aversion. [07:12] This is a very simple concept to grasp and understand. [07:22] This is one of the truest foundations of behavioral economics itself. [07:50] People hate to lose things. [09:10] Our subconscious brain is basically a two-year-old throwing a tantrum. [09:45] In business, we have taken this concept and done things backwards. We try to give people all kinds of things. [10:04] Humans are more easily driven by avoiding a loss than gaining something. [10:52] The difference between how you feel when you find a $20 bill and lose a $20 bill. [13:10] The studies of Kahneman and Tversky have found there is a science to this. We hate losses compared to the joy we feel from getting new things. [13:21] Research shows it takes about DOUBLE the joy felt by a gain to equal the pain felt by a loss. [13:44] Switching from gains to losses. [15:23] What if a FINANCIAL INSTITUTION said, "We have put $50 in your account, if you use your card 20 times this month, you get to keep it." [17:02] Being able to see it is a big key when triggering loss aversion. [17:43] A BUSINESS COACH example. How to use loss aversion to keep your client motivated to do their tasks and reach their goals. [21:30] An ACCOUNTANT example. People are more likely to ask for help if they expect to owe as opposed to ask for help to get more back. [22:23] When messaging around tax time focus on reducing what is owed or being audited and the fear of having to pay or get in trouble. [23:52] An example for FURNITURE sales, interior DESIGN, REAL ESTATE, or any PHYSICAL PRODUCT. Perceived ownership is vital for physical products. [24:34] Getting people to touch the product or walk through a staged home that the buyer could see themselves living in. [25:11] Make the experience as real as possible for the buyer. An example using the show Fixer Upper. [27:18] Loss aversion, the fear of regret and WEDDING dresses. [28:00] How the brain is struggling with the weight of all the decisions it has to make, and knowing once it commits, all the other choices are gone. [28:06] What if questions and fear. [28:22] Triggering loss aversion, so that they know they got a good deal and will feel positive about buying from you. [29:54] An ONLINE SALES example that is the most ridiculous and over the top example of loss aversion that I've seen. [30:25] Clicking yes or no type options to close out a pop up box. Upping the ante using loss aversion. "No thanks, I'm not interested in quickly obtaining my dream body. I understand…" [33:08] A more subtle approach could be more effective. Getting too extreme could go in the opposite direction. [00:37:15] Next week, we have the very first on air strategy session. There will also be an awesome giveaway. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show. Links and Resources: Episode 2 The Top 5 Wording Mistakes Businesses Make Episode 5 The Truth About Pricing Episode 8 What is Value? Episode 3 Do Lead Magnets Work and Do You Need One? Econometrica What Is Loss Aversion? What Is Loss Aversion? Losses attract more attention than comparable gains. Loss aversion Episode 6 How To Sell From The Stage These Are the People Who Are Most Likely to Get Audited [email protected]

I'll be talking about the meaning of value on today's behavioral economics podcast. The past three episodes have been dedicated to the "it's not about the cookie" framework. Which shows that the experience leading up to the sale matters more than what is actually being sold or the price. I'll talk about the difference between value, price and worth and the perceived worth created by the endowment effect. Then I really dive into every aspect of value and how it can relate to sales and persuasion. I talk about how value is often based in our minds and how much we love something. I share the importance of being realistic about price, worth and value when selling things. I touch on the the way that herding, perceived value, and loss aversion work together in things like bidding wars and more on this episode. Show Notes [03:29] Value, price, and worth are used interchangeably, but they are not the same. [04:57] Price is what someone is willing to pay for a good or service. [05:30] Opportunity costs means something can only be used once. [06:04] Worth is the expected selling price of something. Things have worth even if they are not being sold. [06:53] The endowment effect is the phenomena in our brains where simply owning something causes us to find more worth in it. [07:22] I share an example where people were given a lottery ticket and then refused to trade the ticket for two dollars, because once they were endowed with the ticket they could see value in its potential. [08:50] Value is the usefulness or desirability of a good or service. [09:16] Value is based on how much we love something. It's in our minds and it's personal. [11:54] How in real estate people often overvalue their homes because of the sentimental attachment. [12:32] How getting people to be realistic about the worth, price and value is very important when you are trying to convince them to sell something. [12:46] Herding is the brain's desire to be part of the crowd. [14:02] Our brains are trained to assume that the collective consciousness of the group knows more than our brains on their own. [14:22] Herding, perceived value, and loss aversion work together in things like bidding wars. Watch out when you throw scarcity into the mix. [14:43] An example of someone buying William Shatner's kidney stone. [17:23] The ripple effect of price as it makes its way through the herd. As in two billionaires in a bidding war for rare artwork. [19:12] I talk about the Basquiat painting that sold for $110 million dollars and the man who bought it. The purchaser wanted the painting because he was struck with excitement and gratitude for his love of art. [21:15] The power of brands and how they give companies value. [24:21] How our brains get what they expect and a quote from Dan Ariely the author of Predictably Irrational. [27:06] The value of a $200 grilled cheese sandwich. [28:00] Creating brand value with exclusivity and scarcity. [32:34] How brands tell a story about who we are, and our brains love stories. [33:02] Tahitian black pearls and creating value out of thin air. [35:47] With the pearl example, the price tag set an anchor. The Winston name added exclusivity and scarcity, and the glossy advertisement instilled confidence in the herd. [36:14] Our brains believe what they are told until they are told otherwise. [39:03] The placebo effect and how people actually think they get more value when they pay more. [40:02] How price and perceived value are linked in the human brain. [40:14] Measuring sticks for value like currency. [41:48] Value is subjective, in our heads, and it changes. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show. Links and Resources: Cost vs Price vs Worth vs Value Episode 5 The Truth About Pricing Episode 7 Change Management (It's Still Not About The Cookie) Anomalies The Endowment Effect, Loss Aversion, and Status Quo Bias Human Herding: How People are Like Guppies Brother, Can You Spare An Organ? Basquiat painting smashes record with $110m sale Predictably Irrational, Revised and Expanded Edition: The Hidden Forces That Shape Our Decisions People Try World's Most Expensive Grilled Cheese Episode 2 The Top 5 Wording Mistakes Businesses Make How Your Brain Keeps You Believing Crap That Isn't True

The past two weeks have been dedicated to my "it's not about the cookie" framework, which shows how the experience and all the things leading up to the sale matter much more than whatever is being sold itself. This week, I am extending this framework to one more application – change management. Think of this as any time you are trying to get someone to buy in and make a commitment where money is not exchanged. In this behavioral economics podcast, I talk about what change management actually means and how the "it's not about the cookie" framework ties into change management. I talk about how using perceived ownership, the endowment effect, and loss aversion to your advantage in the beginning will pay off in the end. I also talk about how framing is not what you say but how you say it and how to overcome status quo bias. This is the most complex episode of the cookie framework, but it will give you proven tools to implement change. Show Notes [03:38] What the concept of change management actually means. [04:59] Change management or leading through change is something that a lot of people are talking about these days. [05:18] Change and getting people to change is all about selling them on your perspective and getting them to buy in and commit. [05:48] An example of trying to get your significant other or child to do something. [07:48] Ways to get the child to buy in may be making it fun, leading by example, and using distraction. [08:32] I often compare our subconscious brain to a small child. Much of our decision-making is still that on this level. [09:22] A small detail can hang people up when making positive changes. [10:30] How what the person selling the concept thinks is important may not align with what the person buying the concept may think is important. [10:52] Consider the ripples. One small word can have a different impact on different people. [11:21] An example from my credit union days. [12:51] When it comes to credit cards there will be several different groups affected. The messaging needs to be focused for the individual groups that matter. Keep the overall brand message consistent. [14:36] I'm not getting into habitual buying in this episode, but it is really fascinating and I will dedicate an episode to it soon. [15:17] It's important to think about what the specific people need to hear and where they are coming from before applying your messaging. [15:34] Thinking about the group as a whole instead of considering the individuals. [15:55] Office Space, Milton and the red stapler. [17:19] How our brains are very good at dwelling on small items. [17:42] When trying to sell change get ready for loss aversion to rear its head. The Endowment Effect, Loss Aversion, and Status Quo Bias [18:21] The endowment effect as the anomaly that our brains favor things they own over other things. [20:10] We go all in with things that we already have. [20:24] Loss aversion. People hate to lose things. It takes double the joy of a gain to outweigh the pain of a loss. [22:35] Status quo bias. When given the choice people tend to go with the status quo and favor it heavily. Be wary of giving people too many choices. [23:13] How all of this ties into change management. Using these concepts to your advantage is the best approach. [23:45] The five components of "it's not about the cookie." The scent of the cookie, free sample, perceived ownership, today only, and buy three get one free. [24:26] The prep is critical for change management. [24:46] How the smell of the cookies breaks through your subconscious clutter. [26:33] How rumors about the upcoming change are like the smell of burnt popcorn. [28:04] Be thoughtful of how the meeting is framed. Avoid being too vague. [29:14] People need time to process. Share and be transparent. [29:32] Reciprocity - sharing information makes the recipient more likely to have an open conversation. [30:43] Perceived ownership is where people work harder for ideas that they came to on their own. Outline the information you present, so that the recipient will perceive ownership. [31:12] Do your homework when proposing a big change. [34:07] The importance of having advocates and thinking long-term when any change is implemented. [35:10] Using scarcity is optional in change management conversations. Use with caution. [36:45] Knowing what matters to each person helps facilitate the conversation with the desk moving example. [38:28] The problem with unintended ripples using the scarcity approach. [39:10] Framing is everything when it comes to change management. It's not what you say it's how you say it. [40:03] Decide what the one thing is that you want this person to do. Get the person invested in the outcome. [40:37] Frame your offer properly by pointing out the benefits. [44:07] If you thought this was the most complex of the scenarios in the "it's not about the cookie" scenario, you're right. There is a reason it was the final installment. [46:11] Change is all around us, and being

Last week, I talked about The Truth About Pricing, you might want to listen to that episode before we dive into today's episode about how to sell from the stage. Both are built on the same foundation. In the truth about pricing "it's not about the cookie," there were five components that I talked about. I have always loved being on stage from acting as a child to singing and improv classes. I don't think I would be where I am today without this background. When it comes to selling from the stage, the same five components apply. I'll be talking about these components of the scent of the cookie, free samples, perceived ownership, today only, and buy three and get one free as they apply to selling on the stage. Show Notes [02:28] Thanks to all of my new listeners and downloads. [03:18] I love being on stage and grew up acting and dancing. I was also a vocalist and even competed in Opera. I am also in the Screen Actor's Guild and sang with a country band in Seattle. I also sang the National Anthem for the Seattle Mariners. [06:30] I know how to be on stage and work with an audience. [07:24] Being on stage is no different than selling. [07:45] A quick recap of last week. [07:58] How an expert at selling can get a customer drooling like Pavlov's dog where an amateur may not even be able to sell the same product. [08:15] It's all in the delivery and in the right order. I unlocked this method in episode 5. [11:02] How the scent of the cookies forces your conscious brain to do what the subconscious wants it to do. [11:52] You want to build your pricing on this foundation. Even if you are selling on stage. [12:32] Conversations are based on this concept as well. Buying and selling is not always about exchanging money. [12:56] Next week, I will extend this scenario to change management and non-monetary conversations. [13:29] The five components were the scent of the cookies, the free sample, perceived ownership, today only, and buy three get one free. [14:07] A master of selling can get the audience excited about anything that they want to sell. [15:08] The smell of the cookie flags your conscious brain. If you are a speaker, the audience is focused on you. [16:16] Using the 80/20 rule when speaking. 80% of your sales will come from 20% of your audience. [17:40] The scent of the cookies is the title and description of your conference. [20:55] Have an interesting title that is different and makes people want to learn more. [23:42] Incorporating questions into your titles and descriptions. This engages the mind differently. Use questions that will make people say yes. [27:00] The free sample phase of public speaking is when you give your customers a taste of what it would be like to work with you. [28:12] Perceived ownership or reminding the audience of things that are important. [31:34] There is a delicate balance between selling and sprinkling in what it would be like to work with you. [33:19] Today only or a special offer if you act now. This is the concept of scarcity. Watch infomercials for an example of this. They work, because they speak to the subconscious part of the brain. [37:01] The average of people who ask for refunds is about 5%. [37:30] Money back guarantees encourage buying and spending more. [38:44] Buy three get one free. The brain likes things that sound better. The way you frame the message impacts with the brain hears. [40:01] FRAMING is everything – and just as with pricing, it isn't what you say…it is how you say it. [40:57] Two types of public speaking. The hard pitch uses the tactics of relativity, anchoring, and adjustment. [41:58] The informational pitch is more of a long term strategy and it is about 80% of presentations. This is the tactic I take. [42:43] Sprinkling in additional resources that can further learning go way beyond the presentation. [43:24] Offer the one thing that you would want your audience to do. [44:41] In most public speaking the sale is actually a freebie that gets people into your family or on your list. [46:35] This method in these formulas work. You can use the free worksheet to implement this strategy. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show. Links and Resources: The Truth About Pricing The 80/20 Rule And How It Can Change Your Life The Top 5 Wording Mistakes Businesses Make Questions or Answers Unlocking the Secrets of the Brain The Buying Brain: Secrets for Selling to the Subconscious Mind The mind's mirror Good For You, Better For Them: The Truth About Retailer Guarantees Thinking, Fast and Slow, Daniel Kahneman Do Lead Magnets Work and Do You Need One?

Pricing is a top concern for most business owners, service people, and sales people. Today, I'm going to tell you the truth about pricing. The dirty little secret people don't want you to know. It may seem like I'm taking awhile to get to that point, but I want to build the foundations that will create those ah-ha moments for you. I recently returned from the eWomenNetwork conference for female entrepreneurs in Dallas, Texas. I was so inspired by the conference, that I wrote the first draft of this show while flying home on the plane. Price isn't always what matters most to your potential customer. It is how you phrase the price and whether you get your customer excited. Today, I talk about the subconscious, using the senses, having three price points, and how to combine these tactics to increase sales. Show Notes [04:13] One thing I love to watch at conferences is how people position their offers or services. [04:32] It's fascinating to watch the true masters when they sell from stage. [05:30] Next week's episode digs into using behavioral economics to become a better presenter. The concepts are all built on pricing which I demystify for you in this episode. [06:11] Molina is constantly questioning the world around her. Everything is a learning opportunity. [07:21] When I'm consciously examining an advertisement, I'm not really aware of what my subconscious is taking in. [07:43] 99% of our brains processing is subconscious. [09:08] The joy in our brain happens in the anticipation phase not when we get the item. [09:34] The smell of chocolate chip cookies will get your subconscious brain very excited. By the time you arrive to store, you may not be able to resist the temptation of the cookies. [10:45] The importance of the order in which things happen. [12:28] How your conscious brain will unwittingly give in to the will of the subconscious. [12:49] This cookie example is an example of an expert and a novice selling technique. Even if the cookies were expensive, you had already bought them in your mind before you walked in the door. [14:10] Masters of selling will get you excited about selling anything in any medium. [14:44] Melina considered a membership site before deciding on a podcast. [15:59] You want to hear in my campus next piece of information. If you are solving a real problem for your customers in a way that they can understand, they will find a way to pay for it. [16:39] You just need to draw them in with your own take of fresh baked cookies. [16:57] People need to understand the importance of behavioral economics before they care enough to take any step that will cost them money. [18:33] The scent of the cookies needs to come first. Like the information broke down into a free podcast. [18:43] What is your item that gets people to stop and want more? This is the top of your funnel the podcast, the billboard the Facebook or Instagram post. [19:46] If you start out with price people will already tune you out and move on. [19:59] What will draw your clients subconscious in to flag their conscious to be interested in your product? [21:01] Make sure whatever tactic you choose is on point with your brand and your offer. [21:24] How can you incorporate one of the five senses into your business to make it stand out? [22:18] What is your lead magnet? If it's a food item, give your customer a free sample. [23:14] Loss aversion and perceived ownership. [23:31] Our brains are hardwired to latch onto things and not want to lose them. Our brains claim ownership incredibly quickly and do not want to give things up. This is greatly increased with the power of touch. That's why with the furniture example it's good to give them something to touch. [24:06] The overnight test drive is a great example of this. [25:27] Involving the senses can help stimulate the brain's ownership response. How can you do this with your business? [26:22] The concept of scarcity. FOMO or fear of missing out caught on for a reason. Notice the countdown clock next time you buy something. Can you fill your anxiety spiked? [27:59] These countdown clocks trigger something in your subconscious brain. [29:20] Studies show that phrases or offers that rhyme or sound good are more convincing. [31:09] Framing is everything. It's not about what you say it's how you say it. It's not about what you sell it's about how you sell that. [31:22] All of the stuff that leads up to the offer and the pricing matters more than the numbers themselves. [31:43] How to present the item price. [32:22] A study done with grocery store end cap displays. Buy 18 Snickers resulted in a 38% sales increase. The number stands out to your subconscious brain. [34:28] When asking people for money, start with a high number first. [35:17] The concept of relativity. [38:15] Provide three options when setting prices. Take your best offer and list out the value comparisons. Build a decoy item. This should be very similar to your best offer, but with an obviously worse value. Incor

I am so excited about today's episode. Why? Because I love questions. I love asking them, being asked them, evaluating them, and looking for new ones. Innovative approaches are all about asking questions. As a "what if" personality type, questions are my jam. I also have an awesome freebie to go along with this. I talk about my ENTP personality type. My favorite book A More Beautiful Question, and how actionable questions can be used in business. I talk about the right approach to questioning and going from "why" to "what if" to "how." I talk about questionstorming and how this can help you find innovative questions that lead to innovative answers in your business. Questions are a great tool to think outside the box and come up with business changing answers. Show Notes [01:48] I am an ENTP which means I'm extroverted, intuitive, thinking, and perceiving. Stats say that between 1% and 3% of the female population is this personality type. [02:26] In MBTI, all of the types have a title to help describe them. The ENTP is known as "the visionary" or "the inventor." [02:33] My strength is understanding the world around me almost immediately, absorbing ideas, and turning possibilities into ideas. [02:48] ENTPs are great at solving problems in unique ways and asking "what if." [03:09] I also have a love of finding the right answer, and I've always been a straight-A student. [03:26] When it comes to brain training what is better? Questions or answers? and Why? [03:33] A More Beautiful Question by Warren Berger is my favorite book. [04:54] A beautiful question is an ambitious yet actionable question that shifts the way we think about something. [06:09] Innovations that came out of beautiful questions include Airbnb, the Cheetah prosthetic leg, Kodak film, Wite-Out, and microwaves. [06:15] The right approach to questioning is to go from Why? to What if? to How? [06:33] Why questions are your big overarching questions. This is where you start from. This is passion and the core of what you do. [07:20] Why do we have to wait for the picture? Is a question that was asked by the daughter of Kodak's founder. [08:09] People who asked these questions change the world. And you can to with a little bit of brain training. [08:20] Our brains are built on habits and rules of thumb which the subconscious uses to make decisions. [08:53] The more habits you let your subconscious brain get used to, the less reason it has to stop and give your conscious brain something to work on – allowing it to be more and more complacent. [09:18] I'm going to ask you a few questions about your morning routine… [10:07] These questions refer to places where your subconscious brain has taken over the process. [10:19] Train your questioning muscle with these simple tasks of putting your makeup on with your nondominant hand or taking a different route to work. Change things up and force your brain to pay attention. [11:26] How our brains store and retrieve information. [11:39] The Political Mind: A Cognitive Scientist's Guide to Your Brain and Its Politics and the blue square example. [14:19] What does this have to do with business? [14:57] Brainstorming is taking ideas off the surface but not really digging in. [15:14] To help clients approach problems and think about things from different angles, I recommend the activities from Thinkertoys: A Handbook of Creative-Thinking Techniques. [15:39] Questionstorming is an easy thing to try. The goal is to ask as many questions as possible. [16:37] An example of questionstorming. [18:28] Asking "what if" questions and taking the problem on as your own to shift your thinking. [18:37] Pandora asked "what if" we could map the DNA of music? [18:44] The brainy business "why" question is: Why is behavioral economics a best-kept secret? [18:49] What if I show people why it matters? What if I tell people how it works? [20:31] Becoming a better questioner and linking distant connections. [20:52] The final piece is the "how" question. Keep asking "how" until you get to the final piece that sticks. The trick is to fail and fail often. [22:00] Solving problems means knowing what questions to ask. [23:33] Don't let your fear of finding the perfect question keep you from getting to the right answer. [23:50] It takes many questions to find the path to an answer. Start asking as many questions as you can. [25:14] Helping organizations to ask better questions and look at things in a new way is probably my favorite thing to do. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show. Links and Resources: A More Beautiful Question Unlocking the Secrets of the Brain Filene Research Institute The Political Mind: A Cognitive Scientist's Guide to Your Brain and Its Politics Thinkertoys: A Handbook of Creative-Thinking Techniques E.E. Cummings John Tukey [email protected] Send an email to Melina@TheBrai

All over the place these days – they offer you something for free, you fill out a form and get onto their list. So What Makes a Good Lead Magnet? So many kinds – checklist, template, white paper, video tip – I have my ebook, The 10 Behavioral Economics Concepts You Need To Know (And How To Apply Them), which I do invite you to download if you haven't already. Links and Resources Sweetening the Till: The Use of Candy to Increase Restaurant Tipping Giving Your Donors a Gift—Wait! Research Suggests The power of yard signs II: Escalation of commitment What Makes a Good Lead Magnet? (69 examples from Opt In Monster) Customer Avatar Unique Value Proposition Tap for full show notes

This episode discusses the Top 5 Wording Mistakes Businesses Make — a highly requested topic when I did a survey on The Brainy Business Facebook page, which, if you do not already like that page I encourage you to check it out. There is a great discussion there, and I share different content including a lot of tips and you can connect directly with me and others who love behavioral economics. I've broken the Top 5 Wording Mistakes down into five categories: too literal, too boring, too much, too vague, and too confusing. Show Notes: [01:37] Today's episode is all about the Top 5 Wording Mistakes Businesses Make. [03:37] If you have made any of these mistakes, it is important to know that you are not alone and you are in good company. The wording mistakes are easy to change and fix. [05:12] I've broken the Top 5 Wording Mistakes down into five categories: too literal, too boring, too much, too vague, and too confusing. [05:30] An example from the too literal category about a top-notch local nail salon. [09:25] People need to have the message properly framed for their brain. [10:49] Thinking, "it is still true and it was a good thing then so it can't hurt now" is not true. Keeping that old sign up is damaging your reputation now. [12:04] Finding a new way to frame the old literal message will help you stand out and be more effective. [13:41] Another example in Too Literal is talking about features instead of benefits. [16:23] Features and literal translations rarely break through the clutter and don't get remembered. When you are too literal, it is just noise. Use interesting, catchy wording to break through the clutter. [16:55] The next mistake is being Too Boring. [19:21] With a boring name, it will not stand out and you're not going to talk about it even if it is your favorite. [22:48] Let's talk about Cotton Candy grapes. Would we have come to the place of thinking they taste like cotton candy without the prompt? [23:55] In this situation, we have all been primed with the concept of cotton candy. Very likely we wouldn't have all said it tastes like cotton candy but now we did. [24:32] The other concept that comes up, in this case, is the concept of expectation. [25:58] When we believe beforehand that something will be good it generally will be good and when we think it will be bad it will be bad. [27:32] You probably know that dopamine is responsible for enjoyment in the brain and it drives a lot of our behavior, but studies have shown that anticipation is where the dopamine is released versus the treat itself. [30:31] The lesson here is to be interesting to get attention. [31:45] The next wording mistake businesses make is including too much. [32:13] Our brains get overwhelmed easily, way quicker than you would think. This wording mistake is the most common offense. [34:33] When your conscious brain is too bogged down with information for it to be easily remembering, it can't block and help with your making good decisions. [36:14] The point of marketing is to get people interested enough to go to your website, pick up the phone, or come in person. The thing that you are trying to get them to do is take the next action. [37:56] It is more effective to have one message you are trying to get across to get someone interested enough to learn more. [38:36] The 4th wording mistake is being too vague. Melina shares a study from a grocery store. [42:06] Our brain will latch onto an anchor even if it is arbitrary. Look for times when you can get to something specific that is not tied to something literal. [43:45] Understanding how these concepts work together is important if you are trying to implement some of these. A lot of this work together to help you be more effective. [44:25] The last wording mistake I see businesses make is being too confusing. [45:20] What is it that I want my ideal client to do and how can I make it easy for them to understand what it is and take the next step? Our brains are busy and quick to move on if what is there is confusing. [46:51] Having one task for everything that you put out there so that it is not confusing for them and it is really clear is key. [50:30] What is your interesting and not so literal and not vague way of messaging that isn't confusing? [51:19] Melina's closing thoughts. Thanks for listening. Don't forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show. I hope you love everything recommended via The Brainy Business! Everything was independently reviewed and selected by me, Melina Palmer. So you know, as an Amazon Associate I earn from qualifying purchases. That means if you decide to shop from the links on this page (via Amazon or others), The Brainy Business may collect a share of sales or other compensation. Let's connect: [email protected] The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business

This episode is called Unlocking the Secrets of the Brain. And, in many ways, that is what the entire Brainy Business podcast will be dedicated to. That is what behavioral economics is all about. And it is what I am so passionate about. In this episode, I am going to talk about three things: Why you should care about behavioral economics and the impact it has on your business. A little bit about how the brain actually works to give you a foundation to start from. A little about my background and why I am qualified to share this information with you! Links and Resources The Golden Age of Neuroscience has Arrived 52 Card Media Thinking, Fast and Slow The Buying Brain Filene Research Institute Duke University's Center for Advanced Hindsight The Chicago School of Professional Psychology Tap here for full show notes