Cognitive Bias: Watch Here How It Plays Out

This is an edited extract from an interesting post on a topic much written about. from James Altucher, one of the few offering down-to-earth counsel that I like reading.

Cognitive biases are used in almost every sales campaign, business, marketing campaign, movie, news, relationship, negotiations, everything. Almost all of your interactions are dominated by biases and understanding them is helpful in standing up and seeing things for what they really are.

James takes up a rap song of all things and analyzes it for ideas how to be get better at persuasion!!

“

The song “Lose Yourself” is from the movie 8 Mile. Although I recommend it, you don’t have to see it to understand what I am about to write. I’ll give you everything you need to know.

Eminem is a genius at sales and competition and he shows it in one scene in the movie. A scene I will break down for you line by line so you will know everything there is to know about sales, cognitive bias, and defeating your competition.

First, here’s all you need to know about the movie:

Eminem is a poor, no-collar, white-trash guy living in a trailer park. He’s beaten on, works crappy jobs, gets betrayed, etc. But he lives to rap and break out somehow.

In the first scene he is having a “battle” against another rapper and he chokes. He gives up without saying a word. He’s known throughout the movie as someone who chokes under pressure and he seems doomed for failure.

Until he chooses himself.

The scene I will show you and then break down is the final battle in the movie. He’s the only white guy and the entire audience is black. He’s up against the reigning champion that the audience loves.

He wins the battle and I will show you how. With his techniques you can go up against any competition.

After he wins it, he can go on to do anything he wants. To win any battles. To even run the battles each week. But he walks off because he’s going to do his own thing. He chooses himself. The movie is autobiographical. 300 million records later he is the most successful rapper in history.

”

Here is the scene (8.55 mins) with explanatory subtitles:

 

In case of a problem playing it here, it may also be viewed on YouTube.

James also generously provides for supplementary reading here.

Also helps to know if you wish to do all you can in a competitive situation. For instance, you could show your competition as not in the prestigious ‘313’ group (quite the opposite of its negative connotation in the clip!)…

All in all a great effort, so effective in laying it bare for us in the shortest possible way. Thanks, James.

Of course, there are tomes on the subject to read if you so wish.

 

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If You’re Talking To CXO’s…

words matter more than you would know, says Jack Dean – he should know from his extensive experience over the years, sitting on both sides of the table.

Though he talks about B2B marketers, obviously it applies to other segments too. Excerpts from his article appearing here:

“

Have you ever noticed that the words and phrases used by CXO Buyers are somehow different? Their language is different. Their conversations are different. More formal, more direct, more reserved.

I don’t have studies or survey data to support what I’m about to say, but I know with certainty, having been a CXO Buyer influenced by them, that WORDS MATTER. When I was sitting on the other side of the desk as a CXO Buyer (and now during role play conversations in sales training workshops), I used the word choices of B2B marketers as a reliable predictor of their character and professionalism.

Of course, there are other aspects of personal character that are continuously being observed by CXO Buyers (e.g. like how you are dressed, how you treat your colleagues, what you say about your competition, how you control your emotions), but your word choices are, in my opinion, the most important predictor of character and professionalism…

If you believe that you have good-to-great “business-appropriate” language skills, recognize that that capability is a potential competitive selling advantage. My best recommendation is to actively seek out opportunities to CONVERSE with customers, especially CXO Buyers. Phone calls are better than emails. Face-to-face conversations are better than PowerPoint PDFs.

You get the idea … “professionally” flaunt your communication capabilities in order to differentiate from your B2B marketing peers.

My advice is simply an extension of the quote, “Deal with the world the way it is, not the way you wish it to be”. Use your business language skills to your advantage.

”

 

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Source: Image from aircomfortchairs.com

 

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How Twitter Figured Out…

…where to spend the bucks!

A lightly edited excerpt from an article by Josh Elman appearing here. Though dated, the anecdote and the concept are still relevant, I thought. And for companies not merely in the product space. Here we go:

“

Pretty much every new app has the following problem: lots of people sign up but don’t stick around.

I frequently get asked what are benchmarks for retention after one day or one week. My answer tends to be the same for products in the early days:

Ignore the benchmarks. Find the patterns in the stories of people who do get your product. Figure out what converted them and got them so excited to keep using your product every day or every week. In the early days, your main focus should be to attract and create more and more of those “core users” who deeply use your product. Over time you can try to increase averages, but first, you just need a core and strong base.

Most people look too much at the “big data” and try to draw conclusions. In the early days of a product you have to talk to people. You need anecdotes much more than data. You could say The plural of anecdote is data.

To collect anecdotes, you have to talk to actual users. The best users to call are ones who can help you understand why they tried your product and what hooked them. I like to look for bouncebacks. Bouncebacks are users that have tried your product, bailed immediately and didn’t find it useful, came back to try again for some reason (at least 1 week later, or even better, 1 month later), and then got hooked.

The first step is to identify some bounceback users to call…

From these patterns, you can invest in revising your marketing and improving your product and onboarding. Revamp your messaging to focus more on the messages that brought people back and got them engaged. Update your product and onboarding to simplify whatever the users did the second time to get fully engaged…

We learned from early users that many of them signed up for Twitter and thought it was just a megaphone. When they had nothing to say, and didn’t otherwise understand the product they bailed. When they later heard about how valuable Twitter could be if they followed their reverend or the food truck that broadcasts its location every day, they came back and tried again. But this second time they specifically sought out people to follow and had a good experience. We rapidly rebuilt our onboarding to focus much more on following and finding the right people which caused significant increases in how many users were activated after signing up. We revised our messaging to talk much more about finding and following the right people on Twitter instead of talking about tweeting and broadcasting.

I recommend doing this exercise of interviewing new bounceback users every 6 months. You’ll learn a lot about how to keep improving your adoption and activation.

”

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Source: Image from publiclibrariesonline.org

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How do you compete with Amazon?

“

The simple answer is you don’t.

Imagine the following retail scenario. You discover beautiful piece of furniture only to find that it is a “one of a kind”. You discover where you can order one only to find out that it could take 4 to 6 months to receive your order. So, how does this retailer manage to survive in the age of free two day shipping? Salt Creek Farmhouse is an example of a vertical furniture retail shop that has found ways to develop customer relationships to thrive in an omnichannel world. Retail survival requires transformation to new paradigms. Lesson 1 starts with focusing on doing what the giants are not doing.

” 

And what are they doing right?

An extract (lightly edited for brevity) from Chris Peterson’s take on SCF’s success story interspersed with an occasional comment from me within <..>:

“ Five lessons from Salt Creek Farmhouse

1. Telling your story is as important as the products you sell

In the age of mass merchants, much of retail lost its “soul”. Stores merely became places to sell products. SCF is a small business and retail shop with a great story that creates a unique brand identity and differentiation for their products <though “Our Story” could do with more romance in there, I thought>

2. Engage your customers to help tell your story

Far too many retailers use social media as another way to advertise products and promote sales. One of the most powerful aspects of visual social media like Instagram – the new word-of-mouth –  is having customers posting photos of how they are using products in their homes…To quote SCF’s Instagram page: “Lovely pieces should come with a lovely story.

3. When you can’t compete on price, compete on value and personalization

…SCF competes on quality art and workmanship that people still value. They also create personal relevance by designing things for customers, and pieces that you cannot purchase everywhere…<Just imagine what a draw these pieces would be in your rooms>

4. Know your customers and go where they are shopping

For SCF’s products that would get lost and never be found in the millions of SKUs of an retail giant, Etsy was a perfect digital place in the company of other similar artisan style stores therein…core customers could organically search for products like theirs on Etsy. It is more important to be where your customers are, than to be on sites or in stores with the most traffic.

       5. Lack of inventory can be managed as an asset

…SCF literally carries almost no inventory. In order to sell pieces as they build them, they focus on other value propositions of customization and exclusivity as opposed to the old paradigm of “mass merchandising”. It also requires developing an intimate relationship with customers who appreciate quality and service beyond the expected and are quite willing to wait for months to get what they want!…

“

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Source: Chris’s article appears here.

 

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Would You Send All Your Customers To Your Competitor And Still Be In Business?

Well, that’s what Burger King did, we learn. Here’s the story put out by Trend-Watching:

“

On McDonald’s yearly ‘McHappy Day’, the brand donates proceeds from sales of Big Macs to aid children with cancer. On November 10th, Burger King in Argentina contributed to its competitor’s cause. Every Burger King in the country refused to sell Whoppers and redirected customers to McDonald’s so they could buy a Big Mac instead (thereby aiding McDonald’s charitable initiative). Though Burger King’s campaign was a bit cheeky – customers were told to go to the ‘place where they don’t flame-grill their burgers’ – they did help their competitor sell more burgers than they ever had on McHappy Day. And McDonald’s even thanked its rival off-the-record.

Burger King took this opportunity to showcase two sides of its brand personality. Firstly, it proved its empathy and selflessness by sacrificing its own sales to support a charitable effort. How could anyone not get behind that? Secondly, the brand put on a massive show of confidence. Because what it’s saying to customers (without saying it) is, “we’re fine sending you to McDonald’s, because you will like our burger more and you will come back!”

And yes, this is a marketing stunt. But what a stunt. Think about it: Burger King stopped selling their flagship product for entire day, at all its stores in Argentina (109, to be exact), then they directed hungry customers to a competitor! Kudos to whoever was brave enough to pitch this idea…

”

That’s what a brand story is all about!

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Source: Trend-Watching, a site that makes interesting observations on what happens in very diverse fields.

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An Amazingly And Unusually Simple Story Of Converting A Prospect

 

My passion of collecting anecdotes and experiences was unexpectedly rewarded today with a very unusual story. Here it goes:

Amit works for an old, respectable and conservative financial-services organization, helping people with investment counselling and management in certain parts of Mumbai city as well as rural Maharashtra.

On one of his cold-calling visits, he meets up with a prospect in one of the smaller towns.

Whatever else, rural folks, you’d know if you’ve dealt with them, are quite sharp in their assessment of whom they’re interacting with.  So, when Amit introduces himself and his org and explains the purpose of his visit, this man hears him out patiently, asks a few questions and finally says:

‘Look young man, all this is fine. I have heard about your org. No issues there. But I don’t know you at all. You pop up suddenly before me from nowhere and expect me to discuss my finances with you? You’ve no references that I know of, to recommend you.’

Amit digs into his bag.

‘Don’t bother showing me your customer letters. Unless it’s from some one I know, I trust…’

Amit pitches all that he has learnt in his training and all that he had collected from the field over the years.

From the look on the man’s face and the body language, he knows he isn’t making any headway.

And finally:

He pulls out his cell-phone, not one of those fancy ones, and says: ‘Sir, take this. Pls call these people and check,’ reeling out a few names. ‘And ask them how long I’ve been calling them…from this phone.’

The man shakes his head, almost sympathizing with the youngster: ‘How does it help?’

‘Sir, they’ll confirm it to you – for the last 7-8 years, I’ve been calling them from this phone, from the very same number.’

The man says: ‘I’m not sure where you’re going with this, my friend.’

‘Could I be holding onto the same number for so long, Sir, without doing right by my customers? Doesn’t happen with most guys in our profession; they change their numbers often and perhaps jobs too – like they’re erasing and escaping from their past…’

Amit waits for his words to sink in.

They find their mark at last.

The man’s gaze is fixed on Amit as he rests his case. Well, maybe the lad has a point…

With some more effort, he becomes Amit’s customer and remains one till this date.

 

I’ve no problem confessing it would have never occurred to me…

I hope this is now added to the org’s lore to be shared with its employees.

 

End

 

PS: So, what’s it with your investment advisor?

As a man out on the field meeting people and people, I’m sure he has many more stories under his belt. Let me see…if I can tease a few more out of him.

  

Source: besttermplan.in/short-term-investment-plans/

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Who Said Differentiation Is Difficult In A Crowded Market-Place!

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