Barry Schwartz, Author of multiple bestsellers, including the classic book on decision-making, The Paradox of Choice: Why Less is More, joins me on this episode of #Accelerate!
[2:10] Barry has moved cross-country after teaching at Swarthmore for his entire professional life.
[2:44] Andy mentions he first learned of Barry through a TED Talk, and bought his book immediately. Barry cites Daniel Kahneman, and discusses utility — experienced, expected, and remembered — in relation to decisions you make.
[5:03] Kahneman wrote that an experience is remembered by the average of its peak and its end. If it ended poorly, you will not repeat it. The duration of a vacation is irrelevant. Barry says we are clueless about the influences on our decisions.
[7:33] Barry discusses decisions of the buying process, which he describes as a series of separate experiences and decisions. A good first contact increases the chances that you will get a second contact. The peak-end rule is only one factor.
[10:25] Barry says automatic, unconscious processes (Kahneman’s System One), rather than conscious, deliberative processes (System Two), first influence our decisions. We may deliberate the automated response, to revisit our decision.
[14:14] Barry gives practical advice for B2B salespeople on influencing buyers towards your product. Show your product positives, and help buyers reinterpret any negative factors. Negatives standing alone carry disproportionate impact.
[17:12] Storytelling provides vivid examples that can crowd out some negatives. Savvy buyers may be less susceptible to their automatic processes, but they are still factors.
[18:43] Andy cites Simonson and Rosen, and Barry relates an example of Staples and their printed catalog. When Staples eliminated items in the catalog to save printing, they expected to lose sales. Instead, sales increased in all reduced categories.
[23:09] B2B buyers are not necessarily savvy buyers, because they buy large systems infrequently. There is a limit to how savvy one can be in a high-stakes decision that is rarely encountered. For instance, we’re expert on buying groceries — not homes.
[24:40] Barry explains Kahneman’s Prospect Theory. We’d rather take a small certain gain than a larger uncertain gain. With gains we are risk-averse; however, with losses we are risk-seeking. The neutral point between is easily manipulated.
[28:49] Barry describes the foot-in-the-door technique. A small commitment is easy, which then enables larger commitments.
[30:23] Barry talks about maximizers and satisficers, relating to the good-enough decision. It is miserable and long to seek the perfect solution in a complicated world. Be open to raising standards, but don’t be afraid to accept good enough.