5 tips from Behavioural Economics to help you convert your next client
Client pitches can be thrilling and exciting. Being in the spotlight, talking about your product and company is every entrepreneur’s dream. However, getting the pitch right can be challenging. You need to fill your client’s needs, expectations, while reducing risk and standing out from the crowd. In other words, you must make your client’s decision to say ‘yes’ easier, and that requires skill and preparedness.
Making difficult decisions easier is best studied from the lens of Behavioural Economics. Its principles combine the most influential ideas from economics and psychology to vastly improve our understanding of human decision-making. Industry and policy leaders are applying it at large scales to help us make better decisions about our finances, health, and happiness.
So, combining powerful insights from Behavioural Economics, below are 5 science-backed tips to make your client’s decision to pick you easier.
1. Show how your clients lose out by not picking you: Your clients don’t like to lose. In fact, no-one likes to lose. So much so, that research shows losses hurt us doubly more than gains make us feel good. For example, losing Rs. 100 on a bet will make you feel doubly worse than gaining Rs.100 will make you feel happy. This is called ‘loss aversion’. This ‘loss aversion’ is a significant driver of your clients as well. It’s important for you to highlight certain product features and benefits that they lose out on by not adopting your product. Show these in monetary terms, or just how they may end up behind their competitors. In this way, you will help your clients understand the cost of not picking you.
2. Keep it simple: We now live in a world full of information. Social media, websites, online shopping, are bombarding us with information and choices. Research has shown that an excess of information can cause anxiety and an inability to make a decision. In fact, studies have shown we can’t remember more than 5-9 items in our memory at a time. If your pitch overloads your client with information, it will lead to avoidance and make it difficult for them to assess your product. So, think to yourself, can I simplify? Can I get to the point faster? Sticking to small amounts of information at a time - 3-6 items - can significantly increase engagement. It’s even better if you use visuals as they have been proven to increase belief and trust in the information presented. So, stick to the power of simplicity, use visuals, and let information ease the decision of your client, not make it more difficult.
3. Use the power of free: You don’t need to look far to see that there’s no better word in the English language than ‘free’. Companies like Google, Facebook are built on giving things away for free, and your clients love free stuff too. Giving things away for free can create a sense of reciprocity, and this can be a powerful influence on behaviour. Giving your client free insights, product prototypes, will build trust and a need in their mind to give something back. This way, your focus should be on first creating value, and then getting it back in return.
4. Leverage the peak-end rule: Suppose you’ve just watched a James Bond movie and your friend asks if you liked it. How would you decide? Chances are you’ll think back to how the best scene (plot twist, action sequences) and the end made you feel. This is called the peak-end rule in psychology. Our experiences are judged mostly by how they made us feel at the peaks (high or low) and end. This means that the peak and end of your pitch are amongst the most crucial decision points for your client. Create a strong ‘high’ and end with a memorable ‘wow’ moment. This way, when your client looks back at your pitch, you’d have successfully etched your product in their memory.
5. Create an emotional connection: Behavioural Economics shows us that emotions have a large impact on our decisions. Your clients also decide using emotions along with rational thinking. How did the pitch make me feel? How do I feel about the product? How do I feel about the team? These are some questions your client will ask himself. Thus, it’s extremely important to create an emotional connection with your client. The best way to do this is through personal stories. Tell them what personally motivated you to start your company in the beginning, the milestones you achieved creating this product, the hardships you overcame, and the profiles of your team. Weaving your company and product into such personal stories will create a valuable connection that your client can use to better understand your product and company.
So, make your client’s decision easier by showing him the cost of not picking you, keeping it simple, giving value, having a strong peak and end, and creating an emotional connection.
Try these and let me know how it goes at firstname.lastname@example.org