Understand why and how decisions are made so you can leverage the power of the human brain to increase your value and improve your clients’ experience.
I’ve sliced rat brains, worn a lab coat more times than I care to count, drawn far too many organic molecules, and spent years shadowing neurologists. But three years into my undergraduate education, I pushed all of that aside and transferred into the architecture program. Yes, you read that correctly. I switched from a concentration in neuroscience to architecture in my fourth year (and added a couple years to my undergraduate education as a result).
Admittedly, that was a long time ago. I don’t regret the decision; I love architecture. But I do still maintain an interest in the functions of our nervous system. It controls everything – the ways we feel, move, think, and act. Understanding our nervous system teaches us more about ourselves and our clients. And, believe it or not, our brains are relatively predictable. We have tendencies, habits, and biases that influence more than we realize.
Here are three ways you can leverage the predictability of the human brain to improve your business development.
Anchoring bias. Anchoring bias is our tendency to be influenced by the first piece of information we see or hear. It’s the reason retail stores put their most expensive items at the front of the store. After seeing a $500 suit at the front of the store, that $150 sweater in the back doesn’t seem so bad.
As a professional who wades heavily in the waters of expectations, figures, and financials, it’s worth considering how anchoring bias impacts you and the way your clients perceive the value of your work.
For example, before presenting your fee you may think, “I don’t want to barrage my client with a bunch of numbers before introducing the fee.” But the science says otherwise.
Imagine you are the client and you don’t hear any numbers while the architect is presenting their proposal. Then, all of a sudden, they say, “Our fee is $250K.” You’ll think to yourself, “$250K?! That’s a lot of money! And I’m already spending a boatload!”
But anchoring bias teaches us that the order numbers are presented in matters. So instead, the architect says, “We estimate that the total cost of your project will be $2.2 million. The GC will charge around $300K and our fee is $250K.” What happens then? The client thinks to themselves, “$250k? That seems reasonable relative to the other costs.”
The fee stayed the same but the perception changed. That’s the power of anchoring bias.
Loss aversion. Loss aversion boils down to the idea that people dislike losing more than they like winning. For example, the pain of losing $20 is greater than the joy of gaining $20. It’s also the psychology behind insurance. We want to protect ourselves against the bad thing that could happen even if it’s very unlikely to happen.
Loss aversion is particularly strong while making financial decisions. For example, when considering an investment, we tend to focus more on the costs and risks as opposed to the potential gains. And when I say “we” I’m also referring to your prospective clients. So how can you use this to your advantage?
Double down on the potential losses that clients will incur by not using your high-quality services. For instance, highlight potential energy inefficiencies, future maintenance costs, or missed opportunities for maximizing space that occur with other services.
But loss aversion isn’t just about money. It’s also about time, which is why big brands continue running “limited time offers” regularly. Simply put, humans hate missing out. Don’t be afraid to use the power of a diminishing offer in your business development.
For example, add an expiration date and consequence to your proposals. Perhaps missing the deadline pushes back the start date. Or, if you really want to drive urgency, increase the fee by a small percentage if a deadline passes.
You can also be more public about availability of your services. Don’t be afraid to post from your company pages that you have one spot available for an amazing project. This encourages prospective clients to move forward and speeds up deal cycles.
Mere exposure effect. Mere exposure effect is the reason we prefer things with which we are more familiar. For example, you may order the same meal from several different restaurants because you know what to expect. Or you may only eat McDonald’s on long road trips because it’s seemingly near every rest stop and overpass.
The best way for you to leverage the mere exposure effect is by consistently putting yourself and your company in front of as many eyes as possible. Make people familiar with your brand. Marketing isn’t just about conversion, it’s also about exposure. When someone thinks, “I may need [your service],” they should think of you without hesitation.
Basically, mere exposure effect is every marketer’s dream. Post abundantly across multiple social media channels. Send a valuable newsletter every week. Sponsor local and regional events. Run a billboard advertisement. You get the picture: make sure your audience knows who you are and how you can help them.
There’s far more science influencing our daily decisions than we realize. Our brains are amazing machines with (relatively) predictable outcomes. As a business leader, it’s important to understand why and how decisions are made so you can leverage the power of the human brain to increase your value and your clients’ experience.
Tyler Suomala focuses on business development at Monograph. Connect with him on LinkedIn.