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3 Behavioral Science Principles That Lead To Business Success

From the order in which you pitch clients to the number of products you offer, here’s how to get people to choose in your favor.

3 Behavioral Science Principles That Lead To Business Success
[Photo: Flickr]

This year, the U.S. government announced it will begin using insights from behavioral science to make policy decisions. In doing so, it follows in the footsteps of a growing number of forward-thinking companies.

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How come? Because behavioral science research can be enormously powerful. It establishes evidence-based models for explaining and even predicting the decisions people will make in a given situation. Those models have applications not just within organizations, but also in the outer world, among consumers. Here are three business situations where fundamental principles from behavioral science research can help you develop strategies that lead to success.

1. Presentation Order

Let’s say you’re meeting with buyers to deliver a formal presentation, and you know a direct competitor will also be there to make their own pitch. Should your team try to go first or last?

Researchers have found that presentation order has a big impact on decision making, but whether you should present before or after your competitors mostly depends on one factor: the time between presentations. If you’re presenting back-to-back, you should go first, because you’ll shape the buyer’s perception and create biases that will put your competitor at a disadvantage.

But if the time between the presentations is more than a week, you should go last. That’s because the memory of your competitor’s pitch will fade during that period, while your presentation will be fresh, increasing the likelihood you’ll be chosen.

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2. Product Offerings

Numerous studies have analyzed whether the number of product options consumers face impact how they make purchases. Some findings show that too many can overwhelm the brain and hinder a buying decision. But the opposite is also true: If consumers only have one option, they tend not to feel comfortable with it.

For instance, one research experiment studied consumers looking to buy a DVD player. With only one DVD player to choose from, just 10% bought it. But by offering two DVD players, sales skyrocketed, with 66% of consumers walking out with a DVD player under their arms.

This insight is fairly intuitive, but it can help companies tailor their product offerings in consumer settings. Consumers instinctively compare the features, prices, and value of a handful of products, then choose the one they think suit their needs best. This comparison reduces the perception of risk and inspires the confidence to make a purchase.

3. High-Pressure Sales Calls

Ever walk past a sign saying, “Wet Paint, Don’t Touch” and you instinctively want to touch it? Why does a sign that tells you not to do something actually provoke the desire to do it?

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Behavioral scientists have identified a powerful principle called “reactance.” Reactance is the feeling that results when we believe our ability to choose is being restricted. Typically, it leads us to rebel against whatever is being imposed on us–even if we know that behavior to be wrong on an ethical level or counterproductive on a practical one. (That’s why, for instance, “no littering” notices have been shown to actually increase littering.)

The research shows that there are ways to decrease reactance. One study found that compliance with charity fundraising requests rose by nearly 400% when appeals noted that people were “free to accept or to refuse” them. Other expressions–“of course, it’s up to you” or “this is a great offer that you can participate in, if you choose”–can have a similar effect. The point is that establishing the perception of choice leads to more people opting in.

These are just three basic examples of some of the ways behavioral scientists are quantifying decision-making patterns. And companies that internalize them can use them strategically in much more complex permutations–to increase sales, better serve customers, and grow their overall businesses.

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