The Brainy Business | Understanding the Psychology of Why People Buy | Behavioral Economics

Today I am excited to introduce you to a really cool company called Colu. The company was launched in 2014 and currently has a staff of 40 people in the US, UK, and Israel with a mission to make more vibrant, connective, and inclusive cities around the world.  Joining me on the show today is Michael Mazur, Colu’s VP of Business Development and Global Business Development Manager Elad Erdan. One of the things I really love about this company is they were doing some really smart things in previous years that are incredibly applicable during this pandemic to help boost economic recovery and keep cities thriving.  In our conversation, we talk about an amazing project they did in Tel Aviv that helped a shopping area see 700 percent growth in 45 days. We also talk about a new project that just launched in Akron, Ohio and get into some brainstorming around a topic a lot of people around the world have been talking about: masks. Michael, Elad, and I had a short conversation about this and came up with some pretty interesting potential solutions. I look forward to hearing your thoughts on them!  Show Notes: [01:14] Colu has done some really smart things in previous years that are incredibly applicable during this pandemic to help boost economic recovery and keep cities thriving. [03:34] Colu works with cities in the U.S. and abroad, by rewarding resident behaviors that meet the strategic goals of each city.  [04:41] They have worked with many different researchers and experts to create their processes including Dan Ariely.  [07:00] Right now cities mostly need help supporting their small businesses.  [08:45] Each city has its own unique challenges and behaviors they want to promote.  [10:05] They share about the Jerusalem Boulevard Project.  [12:11] They used their platform in Tel Aviv to support the local businesses. They used their mobile app to tell the residents the story of small businesses.  [14:18] The business owners in that area experienced a growth of more than 700% in the first 45 days of the initiative. [15:16] In the next 45 days (even though they no longer had any incentives) the residents continued to visit the area because of the story and the emotional connection that was established.  [18:04] They are working to ultimately create loyalty between the residents and the local businesses.  [19:42] Akron, Ohio is the first city to launch in the states.  [21:26] They created a coronavirus task force to research and figure out how they could best help cities and what cities are going through. [24:13] They are looking at the average price per transaction, the way people consume, and the way people shop by segment.  [26:03] In Akron, you can get rewarded for shopping at a local business whether it is online or in-person. When you are ready to redeem your local coins then you have to be in-person.  [27:46] The city can monitor and change the program as it runs.  [28:54] They are also using challenges; encouraging people to develop a new habit.  [31:35] Encouraging people to wear masks is something that is very difficult and a lot of people are struggling with.  [33:16] Cities started giving businesses carrots for enforcing mask-wearing. In Israel, they reward businesses that are keeping the rules and conditions of the purple badge.  [35:55] We need to take mask-wearing from a negative experience to a positive experience. Say, if you get caught with a mask then you can be rewarded.  [36:45] It is important to highlight the celebrations. We need to acknowledge and recognize people when they are doing something good for themselves and the community. [39:05] Consider this: If you wear a mask you might randomly win a prize.  [40:25] They want to help as many cities as possible in terms of supporting their key points. They focus on small businesses and diversity.  [42:46] It is their mission to help cities think outside the box and in ways that will create long-term change.  [45:12] They are trying to help cities unlock their true potential.  [47:19] Economic recovery will take time, but hopefully companies like Colu can help make that a smoother, faster transition for many cities around the world. Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube More from The Brainy Business: Master Your Mindset Mini-Course Brainy Mindset Course - use code BRAINY to save 10% BE Thoughtful Revolution - use code BRAINY to save 10% Get Your FREE ebook Brainy Pricing Course - use code BRAINY to save 10% Melina’s John Mayer Pandora Station! Listen to what she listens to while working More from Colu: Colu’s Website Colu on Twitter Akronite by Colu Colu on Facebook Articles and Past Episodes: Daniel Pink’s book Drive Coronavirus face masks: Why men are less likely to wear masks Dan Ariely Interview Tim Houlihan Interview Availability Herding Habits Incentives Biases Toward Novelty and Stories Can Behavioral Economics Increase Savings? Roger Dooley Interview Starbucks: A Behavioral Economics Analysis Michael Manniche (The Littery) Interview How to Finally Change Your Behavior (So it Sticks) Social Proof Coronavirus and How the Human Brain Responds to Pandemics Celebrate Network Effect Kwame Christian Interview Dr. Gleb Tsipursky Interview

On today’s behavioral economics foundations episode we are going to be talking about the IKEA effect as well as the effort heuristic. I’ve loved the IKEA effect concept since the moment I heard its name. It is such a quirky title, but so clear for what this concept is all about.  In its most basic form, we value things that we put effort into more than things we don’t. I’ll talk more about the details and nuances as we go through the episode and there are many more ways to use this concept than assembling your own furniture. We take a look at ways the IKEA effect plays out in our lives as well as our businesses.  The IKEA effect doesn’t just have to be used for product businesses. The IKEA effect can play a huge role in change management.  Tune in to learn more about the IKEA effect and how it impacts our lives and businesses.    Show Notes: [00:58] In its most basic form, the IKEA Effect is that we value things that we put effort into more than things we don’t. [03:52] The core of this concept is that when people have an opportunity to build something themselves and when they put some effort in, they will value that thing higher than something they didn’t build.  [04:30] Some studies have attributed this to the pride felt when assembling something yourself, and that is part of it, but it isn’t the whole story. [05:19] The endowment effect is the phenomena in our brains where simply owning something causes us to find more worth in it than what other people see in it, or in its stated price. [06:47] It may seem like the IKEA effect is merely an extension of the endowment effect, but studies have shown they are different. Even when people built something and were told they could not keep it, they still valued the item they made higher than those made by someone else. [09:05] This phenomenon makes it clear why people think their own artwork is worth more than people will pay for it, or why they ask for a lot more money than their home is worth if they put a lot of “sweat equity” into creating it. We tend to think that our effort ties into the direct value and that something we spent a lot of time on is worth more to everyone else as well. [10:12] Humans use effort as a guide for value even when we are not the ones putting in the work. This is known as the effort heuristic, which has found that even when we don’t have direct memory of the work in question (i.e. we didn’t do it ourselves), we still connect effort and quality together. [12:25] Whichever painting or poem people were told took more time to complete was the one they tended to like more and they valued it higher.  [14:17] When the image being shown is of high resolution, you can see the quality, and so that can impact the valuation in addition to the number of hours you were told it took to create. [15:22] When the quality can’t be easily determined by our eyes, other pieces of information will guide the brain’s determination of value. [17:26] The IKEA effect says that we value things higher when we put effort into them. So, the effort heuristic is present within our own IKEA effects, but when someone else is putting in the work, it can trigger the effort heuristic without being the IKEA effect. [18:08] When you are exchanging dollars for hours, it reduces the effort to each 60-minute increment. [21:02] When you are putting a value on your time, it is really hard to get individual hours to reflect your expertise and the true effort you have put into your career. The value you provide is often in the time you are saving them. Knowing what that is worth is a better way to find what to charge than your total number of hours put in. [21:52] The other side of the IKEA effect is knowing that people actually like to put in effort for things.   [23:37] Humans aren’t the only animals who value putting in the effort--birds and rats do this too. We are motivated by feeling like we did something and we earned it (whatever “it” is). [25:28] It is important that you don’t make it too hard so that the project doesn’t get completed. [26:40] The value of the IKEA effect was completely wiped away once they took the thing apart. [27:37] People get to feel like they are smart and savvy shoppers and get the benefit of feeling like they did something in assembling their table or bunk beds for the kids or whatever.   [28:09] The research shows it is best to give a little creativity, along with a lot of guidance, to ensure people will complete the task, be more satisfied with the end result, and get the full benefits of the IKEA effect. [29:33] Using the IKEA Effect for Change Management: When you are looking to introduce a change and just throw it at someone, they have no ownership of it. They didn’t put any effort in so they don’t value it that much. When they are able to help build it, it can make all the difference in whether they are a productive member of the team or a big hindrance you need to help the team get over. [31:08] If there are people on your team who are particularly resistant to change, look for opportunities to include them as early as possible in the next project. Though be warned, if you ask them and don’t include their feedback it could actually end up worse than if you don’t ask at all.  [33:29] It can help your employees look for opportunities to help bring on change themselves, and be more open to changes when they come. Fostering a culture of change doesn’t have to be difficult, and the IKEA effect can make it a little easier. [33:58] A glowing testimonial from a recent attendee of a virtual training on change management I gave to a Fortune 10 company. Looking for a webinar, training, or consulting? Email melina@thebrainybusiness.com  [35:22] If you enjoyed this episode on the IKEA effect and learned something please let me know! Don’t Forget Your FREE IKEA Effect Worksheet! Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube More from The Brainy Business: Master Your Mindset Mini-Course BE Thoughtful Revolution - use code BRAINY to save 10% Melina’s John Mayer Pandora Station! Listen to what she listens to while working Want to join the Twitter game?: Melina’s Tweet Pique Bec Weeks on Twitter Center for Customer Insights on Twitter Neil Hopkins on Twitter Samuel Salzer on Twitter Abaneeta Chakraborty on Twitter Articles and Past Episodes: The Effort Heuristic When and How Does Labor Lead to Love? The Ontogeny and Mechanisms of the IKEA Effect The IKEA Effect: When Labor Leads to Love The IKEA Effect. A Conceptual Replication Anomalies The Endowment  Effect, Loss Aversion, and Status Quo Bias Little Red Wrench story from Nikki Rausch Change Management What is Value? Loss Aversion Kwame Christian Interview Vision Does Not Happen In The Eyes, But In The Brain Nikki Rausch Interview Social Proof Gleb Tsipursky Interview Confirmation Bias Incentives

Today I am excited to introduce you to Dr. Gleb Tsipursky, a disaster avoidance expert and author of multiple books including Never Go With Your Gut, which we will be digging into today, as well as The Truth Seekers Handbook, and a brand new book called Resilience: Adapt and Plan for the New Abnormal of the COVID-19 Coronavirus Pandemic. Gleb has been consulting, coaching and speaking for over 20 years and has done work for clients like Aflac, Honda, IBM, the World Wildlife Fund, and over a hundred others. He taught at the Ohio State University and is a behavioral economist and cognitive neuroscientist studying the psychology of decision making in business. His research has appeared in Behavior and Social Issues, Journal of Social and Political Psychology and more. In our conversation today, Gleb will tell you about why you should never go with your gut, ways to think about avoiding disasters, what a disaster really is, and five important questions you should be asking to identify and avoid those potential disasters. I hope you enjoy the conversation and learn some valuable tips to apply into your life and business. Show Notes: [01:18] Gleb taught at Ohio State University and is a behavioral economist and cognitive neuroscientist studying the psychology of decision making in business. [02:46] Gleb will tell you about why you should never go with your gut, ways to think about avoiding disasters, and five important questions you should be asking in your business. [03:42] Gleb is known as the disaster avoidance expert. Disasters come from bad decisions.  [05:06] In his research he looks at how we deal with these bad decisions in our professional and personal lives.  [07:01] A disaster is anything that makes a significant negative impact on your bottom line.  [09:01] Disasters can result from one big decision or a series of small decisions. [10:19] What are the alternatives to staying where you are and what are the long-term consequences of each action.   [13:19] Our emotions determine 80-90% of our decision making when we don’t follow a structured decision making process.  [14:14] We often feel emotionally attached and invested and don’t realize it will be better in the long run to let it go.  You have to acknowledge you are wrong to address the situation.   [16:45] Previously, the media filtered out some information, but now we have direct communication with public figures on the internet.   [18:55] We believe the first thing we hear until it has been proven wrong.  [19:10] Our gut reaction and intuitions are not wired for the modern world.   [20:09] The anchoring bias is when we are anchored to the first piece of information we hear. It weighs on us more heavily.   [22:19] The main reason we should not trust our gut is because it was created for the savannah environment and we don’t live in that environment anymore.   [23:36] Herding is one way we show our tribal tendency.  [25:44] There is tribal discomfort with someone that is clearly from another tribe. [26:43] An aspect of tribalism is called accent discrimination.  [28:02] Tribalism can hurt morale and engagement and cause disasters.   [29:59] We need to broaden our circle of empathy and who we consider to be part of our group or team.   [30:09] Take an outside perspective. Step outside of yourself and look at your situation from an outside view.   [31:17] Examples of aligning incentives so teams can work toward the same goal.  [33:29] It is important to have globalized incentives that support the company overall.   [34:44] There are more incentives that can be offered then just money.  [37:36] The empathy gap has to do with us underestimating other people’s emotions—especially those who are not part of our tribe. [39:11] It is important to figure out what is going to be emotionally appealing to people and address their emotional needs in a way that aligns with the right incentives for the company.  [40:04] Change management often results in a disaster because the focus is in thinking of people as logical and rational instead of understanding their emotions which inhibit change. You should be addressing the emotions before addressing logic and reason. [41:52] Gleb recommends we use a 5 question process to make decisions we do not want to screw up.  [42:29] We tend to look for information that confirms our beliefs and we ignore information that doesn’t. We need to look twice as hard and weigh information twice as heavily that goes against our preferred choice.   [43:47] Think about what a trusted advisor would say in your situation.  [45:33] You need to have a revision point so you know what you are doing to do differently if things don’t go as you planned. NOW AVAILABLE FOR PREORDER: Podcast Episode Best Practices Checklist (This includes the Trello Template I use for every episode and more!) Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube More from The Brainy Business: Master Your Mindset Mini-Course Brainy Mindset Course - use code BRAINY to save 10% BE Thoughtful Revolution - use code BRAINY to save 10% The 10 Behavioral Economics Concepts You Need To Know (and how to apply them) ebook Brainy Pricing Course - use code BRAINY to save 10% Melina’s John Mayer Pandora Station! Listen to what she listens to while working More from Gleb: Books by Dr. Gleb Tsipursky Disaster Avoidance Experts Free 8 video-based module course, “Wise Decision Maker Course,” and free “Assessment on Dangerous Judgment Errors in the Workplace” Never Go With Your Gut Dr. Gleb Tsipursky on LinkedIn Articles and Past Episodes: Brian Ahearn Interview Kwame Christian Interview Loss Aversion Anchoring  Priming Prefactual Thinking Focusing Illusion Confirmation Bias Herding Biases Toward Others Fundamental Attribution Error Incentives Change Management Survivorship Bias  Optimism Bias

On today’s behavioral economics foundations episode we are going to be talking about survivorship bias. I decided on this episode when Kurt Nelson (cohost of Behavioral Grooves with Tim Houlihan--last week’s guest) shared a comic of the concept on LinkedIn. After some conversation with Benjamin Granlund (the artist from the Lantern Group who created the comic) I learned this is part of their new 100 Behaviors project. They’re sharing (you guessed it!) 100 different behaviors/BE concepts on the socials through these fun little cartoons. One of the early ones is on survivorship bias, and I have linked to their Instagram so you can follow along as well. So, what is survivorship bias? It may sound like it is only a life or death thing…and while that is part of how it was discovered it is more than just about surviving. And, like all the biases you hear me talk about on the show, your brain is using this one all the time, and it can absolutely impact the decisions you make in your business.  Survivorship bias impacts entrepreneurs for sure, but it is also leading people astray in all sorts of businesses. Understanding this concept and being on the lookout for it can help you make better decisions on what to invest in—money and time, make your calculations and predictions of your work more accurate, and generally increase the likelihood that your endeavors are more successful.  Let’s start with the story of how this bias was discovered, which will require us to journey back to the days of WWII...  Show Notes: [03:19] Survivorship bias impacts entrepreneurs for sure, but it is also leading people astray in all sorts of businesses.  [03:49] Melina shares the story of how this bias was discovered, which requires us to journey back to the days of WWII. In a war, the slightest edge can be the difference between success and failure. [05:52] The problem with reinforcing the spots on the planes that have received the most bullets, is that it doesn’t account for a very large and important part of the data set (the planes that didn’t make it back). This conclusion is missing what’s missing. [06:46] In fact, those blank spots are where you want to reinforce the planes. It will make them stronger in those places so they can take some fire there and not go down. [07:39] One common example of survivorship bias is when you seek advice on how to be successful. [09:11] 2 million of the students who start college each year will drop out before graduating. [10:04] If you only look at the successful people and ignore those who failed you aren’t getting the true picture. [10:53] We just see the few who win and it makes it seem like those stories are more common than they really are. [11:24] As we look back on our own lives, we see choices that we think got us to where we are, but those on their own are not the answer.  [13:15] There are lots of other factors that determine success. If you do exactly the same thing year after year you will not always have the same end result. [13:51] Survivorship bias was making them only look at what they did and assume that it is the winning formula no matter what, but it just isn’t the whole picture. [15:10] Just because two things are seen at the same time doesn’t mean that one caused the other to occur. This is the difference between correlation and causation.  [16:07] Just because two data sets appear to go together doesn’t mean one actually caused the other to happen. [16:59] Even if there is causation it doesn’t mean that it is the only thing that is causing that particular outcome to occur.  [18:12] For every 1 popular book out there, one million unsuccessful books and their authors are the other side of this survivorship bias phenomenon. [18:41] There isn’t a magic pill or silver bullet to “win.” It takes trial and error and a lot of hard work.  [19:28] Being ready to invest and do the hard work (which includes looking at your goals and problems from all angles and taking the tendency of survivorship bias into account) will put you miles ahead of your competitors and make it more likely that you will succeed too. [19:46] Some other areas where survivorship bias can cause us problems is when we say things like, “I will win because I have a better product or service than they do.” [20:30] The lesson here is to look at all the possible data points and not focus on one single aspect. [20:48] Another place where survivorship bias comes into play is on customer satisfaction surveys and other questions you are asking of your current customer base. [22:31] Across the board, if you aren’t considering the full data set of people, your results (and consequently the actions you take based on those results) will be biased. [23:00] A good rule of thumb is to stop, take a breath and ask, “What about everyone else?” or “Who have we not thought of?” “Who else is there?” [25:29] Taking the time to slow down and consider what might be missing, what the data could look like from another angle and reframing your question to see how the results and insights change, can make a huge difference. [25:44] Look at the survivors, winners and success stories, but don’t forget about everyone else. Their lessons can keep you grounded and help you to become your own winning success story. Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube More from The Brainy Business: Master Your Mindset Mini-Course Brainy Mindset Course - use code BRAINY to save 10% BE Thoughtful Revolution - use code BRAINY to save 10% Get Your FREE ebook Brainy Pricing Course - use code BRAINY to save 10% Melina’s John Mayer Pandora Station! Listen to what she listens to while working Articles and Past Episodes: What Every Founder Needs to Know About Survivorship Bias Why It's So Hard To Succeed - The Survivorship Bias You are missing something! - Survivorship bias 7 Lessons on Survivorship Bias that Will Help You Make Better Decisions How the Survivor Bias Distorts Reality Survivorship Bias: The Tale of Forgotten Failures 100Behaviors on Instagram Lantern Group Missing what’s missing: How survivorship bias skews our perception The College Dropout Problem Hilarious Graphs Prove That Correlation Isn’t Causation The 10 Most Bizarre Correlations Alchemy: The Dark Art and Curious Science of Creating Magic in Brands, Business, and Life Tim Houlihan Interview Availability Focusing Illusion Optimism Bias How To Start and Grow a Successful Podcast Surprise and Delight Peak-End Rule Framing: How You Say Things Matter More Than What You’re Saying

Today features an interview with Tim Houlihan, cohost of Behavioral Grooves podcast and the Weekly Grooves podcast, also the founder of Behavior Alchemy. Behavior Alchemy is a consultancy helping companies to incorporate behavioral economics into their businesses, we will talk about some of his work and past projects – including one with Dan Ariely. In life, I think it is important to find joy and humor in the small things. So when there was an opportunity for some with this episode, we took it. You see, I was a guest on the Behavioral Grooves podcast for episode 109 of their show, and even though this was recorded several weeks ago, Tim and I agreed it was worth holding onto for a bit so we could have this crossover episode of sorts be the same number. In our conversation, Tim and I focus on goals. Something you have heard covered a lot on the show, and while he has some similarly aligned tips, the stories and studies he references are mostly going to be new to the show. And in my opinion, reinforcing tips is important to help you find the right way to achieve more of your own goals. It is a good thing to revisit in as many ways as we can so everyone can find the thing that resonates with them specifically. I am sure you will find some interesting and useful tips and tidbits in this conversation with Tim. Show Notes: [01:32] Habit Weekly shared their top behavioral science content of 2020 so far. There were only 4 podcast episodes included, and my interview with Dan Ariely on the Shapa numberless scale (ep 101) was one of them! Thank you Habit Weekly!  [02:51] In life, I think it is important to find joy and humor in the small things and so when there was an opportunity for some with this episode,we took it... [04:37] 20 some years ago, Tim got involved in a business designing incentives and employee engagement programs, rules and rewards. That led him down a path of falling in love with behavioral sciences.  [05:59] They use the Behavioral Grooves podcast to expand their own learning and it has become a public service about application of behavioral science at work and life.  [06:20] On the Behavioral Grooves podcast they talk to researchers, practitioners, and “accidental behavioral scientists.”  [08:26] Think as big as possible when you are setting your goals and vision. When you are looking at actually moving forward, you want to go as small as possible, especially when executing.  [09:29] Tim uses Big Hairy Audacious Goals (BHAGs). These light up our prefrontal cortex which gets our imagination engaged.  [10:18] If you don’t break those big goals down into small bricks you can’t build the cathedral.  [10:29] The articulation of the plan is most important in any goal development.  [11:27] Self-selected goals are the richest kind of goals we can have.  [13:01] Since the half marathon Melina has been training for is pivoting to a virtual half marathon she is having to revisit and reshape her vision based on what the world will allow.  [15:21] Social media is going to help people to stick to their commitments and achieve their goals.  [17:12] If people are not given due dates they often procrastinate and struggle to meet the goal.  [20:03] Many people would do the bare minimum to hit their goals at the call center.  [21:39] The environment and context was shaping their decisions.  [23:42] A More Beautiful Question talks about using questions instead of answers and some schools that have come up with alternative models to teaching.  [25:03] Tim recommends the fewer the goals the better and no more than three goals at one time. (Matching Melina’s advice! Narrow down to your three goals with the free Master Your Mindset Mini Course) [25:46] Goals need to be time specific and time manageable. Tim suggests month long goals or quarterly goals.  [26:25] The shorter the goals, the more likely you are to achieve them. We rely on achievement to propel us to take on the next goal.  [27:41] We can do so many things to contribute to our goal if we are thoughtful of our goal, our daily activities, and have a plan. Failing to plan is planning to fail. A goal also needs to be measurable.  [30:39] Start small with something that is totally achievable.  [31:34] When you set up your to-do list with 35 things and you only get 3 done you feel like you failed.  [34:36] Everything we think should work tends to backfire and often make things worse. Melina shares the example about the day care.  [34:49] Tim is a big fan of using non-monetary incentives in the corporate world.  [36:10] The best way to motivate team members is with their emotions and that is a non-monetary incentive.  [37:21] The group that was given gifts worked 30% more and delivered more effort, and created better results than the group that received cash.  [39:02] Every time you reconsume the gift it takes you right back to that great feeling of winning the item the first time.  [41:29] If you have employees and you are giving things away and you can retrigger the memory it increases motivation and draws out extra effort.  [43:16] Even if we buy something, it wouldn’t mean nearly as much if we win it in a contest.  [46:07] Tim’s band is back in songwriting and recording mode in their individual houses (now you get where the “grooves” of Behavioral Grooves podcast comes from!)  [48:19] Want to listen to what Melina is listening to while she is working? Check out her carefully curated “John Mayer Pandora Station” here: https://pandora.app.link/UrWQ28B6l3 .  Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube More from Tim Houlihan: Behavioral Grooves Behavior Alchemy Tim on LinkedIn Tim on Twitter More from The Brainy Business: Master Your Mindset Mini-Course Brainy Mindset Course - use code BRAINY to save 10% BE Thoughtful Revolution - use code BRAINY to save 10% The 10 Behavioral Economics Concepts You Need To Know (and how to apply them) ebook Brainy Pricing Course - use code BRAINY to save 10% Melina’s John Mayer Pandora Station! Listen to what she listens to while working Articles and Past Episodes: Podcast editing and show notes by Pro Podcast Solutions Melina Palmer: Using Behavioral Economics to Help Businesses Anchoring & Adjustment Framing: How You Say Things Matter More Than What You’re Saying Dan Ariely Interview Loss Aversion Questions or Answers Bikeshedding Relativity  Reciprocity Discussion With Samuel Salzer Lead Magnets Incentives Surprise and Delight Motivation A More Beautiful Question: The Power of Inquiry to Spark Breakthrough Ideas

2 years. 6 continents. 108 episodes. 162 countries. 207,000+ downloads.and this is just the beginning… Today’s episode honors the two year anniversary of the podcast with some celebration and my tips for starting and growing a successful podcast. The Brainy Business podcast launched with its first three episodes on Friday, July 6, 2018. We have had an episode every single week since then and never missed a Friday release or newsletter in those 2 years. Hooray! That first month had 844 downloads, which I was incredibly excited about at that time! As you’ll learn in this episode, my show actually hit the average podcast download numbers in that first month...and since then things have gone up and up. It took 483 days to hit the first 100,000 download milestone and less than half that time (only 237) to get the next hundred thousand. If pace stays the same we will be passing the quarter million mark around October, which is amazing as well! There have been listeners on every continent (minus Antarctica) and 162 countries. Shout out to the top downloaders! Not surprisingly, the US tops the list, followed by the UK, then Canada, Australia, India, Germany, Brazil, Mexico, Israel, and Spain rounds out the top 10. Coming in at 11 we have the Netherlands, followed by South Africa, Ireland, Sweden, Denmark, New Zealand, Switzerland, Singapore, United Arab Emirates, and France rounding out the top 20. Shout out to my friends in Canada! The top Canadian provinces by downloads are Ontario, followed by British Columbia and Alberta. And to those in the states, we still have a lot of the same top 10 with a fairly similar order: California has the most downloads followed by Washington, Texas, New York, Illinois, Florida, Georgia, Virginia and North Carolina. What has made the podcast successful, and what can you learn from my first two years in podcasting?  That’s what this episode is all about. I’ll answer questions like: How long does it take to run a successful podcast? Do you really need to be weekly? How many downloads does the average podcast get? Do most podcasts make money? How should you strategically think about your cover art and podcast name? What the heck is podfade, and should you be concerned about it? All this and more covered in this week's episode…[PLUS my awesome Podcast Episode Best Practices Checklist is now available for preorder!] Show Notes: [00:46] This week is the two year anniversary of The Brainy Business podcast, which launched with its first three episodes on Friday, July 6, 2018. [01:38] There have been listeners in 162 countries. [04:04] I appreciate each and every one of you who has ever interacted or connected with The Brainy Business. [06:10] Podcasting is a growing medium, and just like any exciting new format it can feel like “everyone” has a podcast and that you “must” be there to be successful in business. [07:24] If it isn’t worth your time to be there and build it the right way, it probably isn’t worth doing. [09:39] Sure, I could spend less time preparing for each episode, but all those things are what make The Brainy Business successful. [11:41] I did the research and invested in good audio from the beginning. [13:45] Why is a podcast a good fit for your business model and how will it support the work you do? [14:28] One other reason I started the show was to help people understand what behavioral economics even is and how it can apply to business. [16:36] Knowing your goals before you jump in and create a podcast is incredibly important and should be used to determine how you set up the structure of your show.  [19:03] Clear, concise, targeted content can often take more time to create than something longer.   [20:35] Most podcasts don’t get past episode seven.   [21:27] Podcast stats aren’t as detailed as we would all like them to be. [22:35] Most podcasts do not make money, and actually cost money. [24:05] Podcast downloads are not a perfect science and the numbers look at the average after an episode has been live for 30 days. [26:54] According to Libsyn, the hosting platform I and many other podcasters use, the average podcast episode has 141 downloads after 30 days. (As you saw in the intro, The Brainy Business was above this from the first month of launching the show, even though I didn’t have a big list - the tips in this episode are a big reason why.) Preorder Your Podcast Episode Best Practices Checklist NOW [28:22] Think about how you will stand out from competitors. [28:56] Knowing which areas are searchable is important in helping people find you. [30:45] Searchability and clear alignment to the topic was most important. [32:43] The name and art should draw their eye and make them want to click to get to the next step of reading your full title and description and decide if they want to listen to an episode. [33:38] If you are going to be investing in a podcast, it should be a main driver of business for you. [36:06] In my opinion, it is almost not worth doing if you aren’t going weekly. [38:12] Start with your first three episodes and go live with them on the first day. This allows people to begin that binge listening and start forming that habit. [39:46] It is more important to pick a day that works with your schedule so you can release great content on time every time than it is to be on the “perfect’ day. [41:12] For each episode, I come up with the topic and determine if it will be a guest or a solo episode. After I determine my topic I start doing my research and write the full script.  [41:51] After all the preparation, I then record using my ATR2100 mic into a system called Audacity. Then I submit to the team for editing and creating social media graphics and worksheets for the episode (using Canva).   [42:43] I listen to every single episode and review and edit the show notes before approving. [43:26] I also create audiograms (using Headliner), set up the newsletter (Active Campaign) and write the social copy for all platforms.   [45:11] Spend an hour making a list of every topic you could possibly do an episode or post about. Break them up into smaller pieces, combine some together, list as many as you can.  [46:09] Write down ideas in bulk when you don’t need them right away. It is much easier to come up with a bunch of topics when you don’t need them. When it is for next week’s show it is a lot harder to create a topic from scratch. NOW AVAILABLE FOR PREORDER: Podcast Episode Best Practices Checklist (This includes the Trello Template I use for every episode and more!) Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube More from The Brainy Business: Master Your Mindset Mini-Course Brainy Mindset Course - use code BRAINY to save 10% BE Thoughtful Revolution - use code BRAINY to save 10% The 10 Behavioral Economics Concepts You Need To Know (and how to apply them) ebook Brainy Pricing Course - use code BRAINY to save 10% PREORDER SPECIAL: Podcast Episode Best Practices Checklist (Includes Trello Template!) only $20 Articles and Past Episodes: Pro Podcast Solutions Audio-Technica ATR2100x-USB Cardioid Dynamic Microphone Podcast Industry Statistics 40 Powerful Podcast Statistics to Tune Into 104. How To Ethically Influence People: Interview with Author Brian Ahearn 107. How to Have Difficult Conversations About Race & Inequality: Interview with Kwame Christian 82. The Best Content from the Brainy Business in 2019 100. 100 Episodes – 1 Big Insight 15: Availability: Why People Are More Likely To Get Flood Insurance Right After a Flood: A Behavioral Economics Foundations Episode 19. Herding: Come On And Listen…Everyone Else Is Doing It: A Behavioral Economics Foundations Episode 34. Optimism Bias: The Good And The Bad Of Those Rose-Colored Glasses: A Behavioral Economics Foundations Episode 23. Reciprocity: Give A Little, Get A Lot: A Behavioral Economics Foundations Episode 3. Do Lead Magnets Work and Do You Need One? 103. How To Revisit & Update Your Lead Magnets, Freebies & Opt-Ins 43. A Guide for You to Create a Brainy Brand 61. Color Theory: When It Comes To Color, This 1 Thing Matters More Than Anything Else 21. Habits: 95% Of Decisions Are Habitual – Which Side Is Your Business On?: A Behavioral Economics Foundations Episode

Today’s episode features a discussion with Kwame Christian, host of the Negotiate Anything Podcast, with tips for having difficult conversations around racism, inequality, and more. Today is an especially important episode of the podcast, as it was inspired by the current landscape in the United States, which has grown to include global conversations around inequality and racism on all levels. I’m not sure if you have noticed this, but in general, I make a very conscious effort to not be political or inflammatory on the podcast. It is my goal to be impartial whenever possible, and I debated for a long time about whether or not to do an episode on this topic. I didn’t want to say more of the same stuff that was out there and wanted to make sure that the value was still tied to the intent of the podcast: applying brain and behavioral science into business. I had almost decided to not cover the topic when Brian Ahearn (whom I interviewed on episode 104 of the podcast) sent an email with a guest suggestion – a friend of his named Kwame Christian. Kwame is an attorney, negotiation expert with a background in psychology. In our conversation today, Kwame will tell you about his three-step framework for negotiating anything, from 9-figure business deals to conversations with kids. He will also share how even though his personal and business credo is “The best things in life are on the other side of difficult conversations,” he was reluctant to be a voice in the Black Lives Matter movement, but once he stepped into the role with a virtual town hall, he has been featured in Forbes, CNBC, and USA Today. He is also one of the nicest guys around, and while his kind demeanor may seem counterintuitive in negotiating, I think it is his superpower (and it can be yours too with his great tips!) Show Notes: [00:52] Today is an especially important episode of the podcast, as it was inspired by the current landscape in the United States, around inequality and racism on all levels. [01:24] It is my goal to be impartial whenever possible, and I debated for a long time about whether or not to do an episode on this topic. [02:11] Kwame talks about the importance of compassionate curiosity, has a TED Talk on finding confidence in conflict, and incorporates details about how the brain works in his tips for how to have productive conversations. [04:15] In our conversation today, Kwame will tell you about his three-step framework for negotiating anything, from 9-figure business deals to conversations with kids. [06:14] His motto is, “The best things in life are on the other side of difficult conversations.” [07:27] You can empathize without agreeing.   [09:29] The thing that drew him to negotiating was psychology. [11:16] Kwame hosted a virtual town hall and expected a couple dozen attendees...over 1,000 people showed up to discuss having difficult conversations about race.   [12:19] Race is a difficult conversation, but an important one that we can’t ignore anymore.   [14:39] There is a fear that often keeps people from saying anything at all. [15:56] The majority of people want to get engaged, but don’t know-how.  His advice is to do something. Anything! One small thing at a time.   [17:01] We have to control the narrative for ourselves.   [17:57] There is something you can do. Just find one little thing and do it.   [19:15]The Compassionate Curiosity Framework is simple and flexible to use in different difficult situations  [20:20] The compassionate part is important because it helps to moderate your tone.    [22:01] The IKEA Effect is when we feel much more connected and are willing to overlook the flaws on something we built or created ourselves. [24:09] Take the time and prethink difficult conversations as much as possible.    [26:53] He likes to use the gap theory of persuasion. The gap theory is using a compassionate tone but asking questions that show a gap in their understanding.  [28:54] Confirmation bias is so powerful, prevalent, and has an incredible impact. [30:02] We often don’t do the personal research because we want to avoid the emotional discomfort.   [32:06] With our subconscious brain running the show, it is able to process 11 million bits of information per second that it is constantly filtering what is making it to your conscious brain, that can only take 40 bits of information per second.   [35:03] You were placed in this system to see what you see from your perspective.  [36:05] This awakening doesn’t feel good and often people experience that discomfort and pull back, worried it is a sign they are doing something wrong. It is actually a signal of growth.   [37:36] An example of the focusing illusion and we hate to see ourselves on video. Shifting your focus can help you find the one small thing you want to do each day. [39:57] Kwame is often asked how to talk to kids about this sensitive topic.  If you are not talking to your kids then other people are.  [40:36] We can use the Compassionate Curiosity Framework to talk with our kids also.   [41:46] We don’t need to look at the outcome always in terms of tangible accomplishments.     [43:27] The entire goal of the first conversation could just be to open the door for more conversations. [45:57] Being open to what the other side has to say and knowing that they don’t need to be wrong in order for you to be right can help conversations go so much smoother. [46:53] You can make a lot more progress with compassionate curiosity than with a plan to force someone to change their mind. Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube More from Kwame Christian: Kwame on LinkedIn Kwame on Twitter Finding Confidence in Conflict Ultimate Negotiation Guide Discussing Racism In The Workplace: Using Positive And Persistent Pressure To Enable Honest Dialogue Talking about racial inequality at work is difficult—here are tips to do it thoughtfully Nobody with Play with Me Book More from The Brainy Business: Master Your Mindset Mini-Course Brainy Mindset Course - use code BRAINY to save 10% BE Thoughtful Revolution - use code BRAINY to save 10% The 10 Behavioral Economics Concepts You Need To Know (and how to apply them) ebook Brainy Pricing Course - use code BRAINY to save 10% Freebie Worksheet Articles and Past Episodes: 104. How To Ethically Influence People: Interview with Author Brian Ahearn 11. Anchoring & Adjustment: The 1 Word That Increased Sales 38%: A Behavioral Economics Foundations Episode 16. Framing: How You Say Things Matter More Than What You’re Saying: A Behavioral Economics Foundations Episode 102. Confirmation Bias: How Your Subconscious Beliefs Shape Your Experiences (A Behavioral Economics Foundations Episode) 95. Hate Being on Camera? Understand Your Brain’s Biases To Change Your Mind 92. Fundamental Attribution Error: Why the Pot Insists on Calling the Kettle Black (a Behavioral Economics Foundations Episode) 89. Focusing Illusion: Why Thinking About Something Makes It Seem More Important Than It Is (A Behavioral Economics Foundations Episode) 71. Prefactual Thinking: How to Turn “What If” Into “Why Not” – Behavioral Economics Foundations 45. Overview of Personal Biases 46. Biases Toward Others – Including Groups 18. Priming: Why You Should Never Have A Difficult Conversation With Someone Holding An Iced Coffee: A Behavioral Economics Foundations Episode  

On today’s behavioral economics foundations episode we are going to be talking about the network effect (or perhaps it is more accurate to say “networking effects” because as you will learn throughout the episode, there are multiple kinds and situations for how they can be useful in a business). I am also going to talk about some pitfalls to look out for and how to incorporate behavioral economics into all of that.   This episode is related to the topic from last week about subscription models and even more directly to membership groups. I will explain that specifically throughout the episode, and if you haven’t listened to that one yet you will want to check it out. It’s episode 105 and there is a link for you in the show notes. Today, I’ll tell you what the network effect is and how it works, what it is not, some pitfalls to look out for, behavioral economics concepts to keep in mind, and so much more. And before we jump right into the network effect, a quick shout out to Clayton Key, whom you can all thank for today’s episode. Clayton and I connected on LinkedIn and in our messenger conversation he recommended the topic of this episode. Do you have a topic or question you’d like to suggest for an upcoming episode? Connect with me (Melina) on the socials using the links below. Show Notes: [01:01] This episode is related to the topic from last week about subscription models and even more directly to membership groups. [03:27] Thank you to Clayton Key for this great episode suggestion.  [04:09] In its simplest form, the network effect is when the value of a business increases as the network grows. [05:51] The network effect makes it so new people joining the network increases the value for everyone. [06:51] Ebay, Etsy, Facebook, Twitter, Linkedin, YouTube, PayPal, Uber, Lyft, AirBNB, Google, Wikipedia, Pinterest, and Apple’s App store are just a few of the many businesses these days built on the network effect. [08:18] A direct network effect is when an increase in usage and users leads to a direct increase in the product or service’s value for other users. [08:59] When you get to a platform business they are a little more complex because there are multiple user groups to consider, which is when you get to a two-sided network effect.  [10:37] The key difference from a two-sided network effect and a direct network is that the type of user joining matters. [12:19] In the case of a social network, which is a two-sided network as well, they need to be monitoring their user quality to remain viable and increase value. [13:47] To attract the advertisers and make money, you need good users. [15:14] As each local network grows and increases engagement, the value of the entire network grows along with it. [16:50] People can of course be a part of many groups, and so attracting diverse users who understand all the content they can get access to on the platform is key. [18:19] Network externality is an economics term that is showing how demand increases when other people buy a product. [19:36] A business can have network effects but not be “viral”. [21:18] If you are looking to start on a network effect business, you need to understand when you will hit critical mass, what it looks like when you get there, and what you need to do to get there quickly so you can move into that value point. [23:14] So, when setting up this model remember that you need to be able to stick it out for a while up front while it may be costing you money, knowing it will pay off once you hit critical mass. [25:13] This platform model is looking for quality growth. [26:34] Network effects are not quite a house of cards, but being dependent upon users working harmoniously together does make a somewhat precarious beast that needs constant monitoring and attention.  [29:07] 5 C’s of network effects are connection, communication, collaboration, curation and community. [30:16] Help make it easy for people to feel like they are part of the global community so they can take ownership over their content and be part of quality creation within the platform itself. [32:29] Put effort in to retain the customers you’ve added. [34:56] You want a platform people actually use so the network effect can grow and thrive. [37:10] Brand extensions are a delicate balance of finding something that is related enough to make some sense for tying it to the original brand, but not so close it feels like it should have been part of the main offering to begin with. Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube More from The Brainy Business: Master Your Mindset Mini-Course Brainy Mindset Course - use code BRAINY to save 10% BE Thoughtful Revolution - use code BRAINY to save 10% The 10 Behavioral Economics Concepts You Need To Know (and how to apply them) ebook Brainy Pricing Course - use code BRAINY to save 10% Freebie Worksheet Articles and Past Episodes: Network Effects: How Growing Your User Base Can Increase the Value of Your Product or Service The Network Effects Manual: 13 Different Network Effects (and counting) Network Effect VIRALITY VS. NETWORK EFFECTS Reverse Network Effects: Why Today’s Social Networks Can Fail As They Grow Larger Network Effects Aren’t Enough Why Network Effects Matter Less Than They Used To How To Harness The Power Of Network Effects Network Effects Network Effect 16 Ways to Measure Network Effects Consumer Evaluations of Brand Extensions 6 Worst Brand Extensions from Famous Companies 38. Defaults: The “D” in NUDGES: A Behavioral Economics Foundations Episode: A Behavioral Economics Foundations Episode 19. Herding: Come On And Listen…Everyone Else Is Doing It: A Behavioral Economics Foundations Episode 87. Social Proof: How to Use Herding to Boost Engagement and Sales 15: Availability: Why People Are More Likely To Get Flood Insurance Right After a Flood: A Behavioral Economics Foundations Episode 9. Loss Aversion: Why Getting New Stuff Is Not The Same: A Behavioral Economics Foundations Episode 11. Anchoring & Adjustment: The 1 Word That Increased Sales 38%: A Behavioral Economics Foundations Episode 12. Relativity: The Brain Can’t Value One-Off Items: A Behavioral Economics Foundations Episode 8. What is Value? 14. Scarcity: Why We Think Less Available Means More Value: A Behavioral Economics Foundations Episode 97. Peak-End Rule: Why Averages Don’t Always Matter (A Behavioral Economics Foundations Episode) 72. Friction – What It Is And How To Reduce It, with Roger Dooley 105. Subscriptions and Membership Programs: A Behavioral Economics Perspective 20. Defaults: Why The Pre-Selected Choice Wins More Often Than Not: A Behavioral Economics Foundations Episode 21. Habits: 95% Of Decisions Are Habitual – Which Side Is Your Business On?: A Behavioral Economics Foundations Episode

Today, we are going to be talking about subscription models and membership groups. I have been thinking about an episode on this for a long time. As many of you know, if you’ve been listening and following The Brainy Business for a while, I launched a membership group at the beginning of 2020. It's called the BE Thoughtful Revolution, and I’ll use examples from my experience of setting that up (as well as others) throughout the episode.  At the center of any really strong business is finding the experience people want (the biggest benefit to them) and showcasing the value in a way that makes it easy for them to say yes.  Even if you are thinking about creating a subscription or membership now because you think it will benefit your business, solid customer experience has to come first in the design and final decision. You need to think of the people you are creating this for, what they want and what they will be excited to pay for.  In this episode I’ll talk about the behavioral science concepts behind subscriptions and memberships, how to consider if they are a fit for your business, and then I’ll do a Q&A with the actual questions listeners like you posted to me on social media. If you don’t yet follow The Brainy Business, you can find me as @thebrainybiz on Facebook, Twitter and Instagram. Links to all the socials below! Show Notes: [01:35] The environment is going to be changing constantly over the coming months (and possibly years) as we all adjust to the impact of coronavirus. [02:24] What we can do is take a look at our businesses and industries to determine how to reinvigorate the offerings we are putting out there, and provide them in a way people want to do business with us instead of what was convenient for us to set up in the past. [04:03] At the center of any really strong business model (subscriptions and memberships included) is finding the experience people want, the biggest benefit to them, and showcasing the value in a way that makes it easy for them to say yes.  [05:43] Being inside a business or industry, it is far too easy to get hung up on the specifics of what you do or offer. The problem is then you lose the big picture and in many ways don’t see how you are becoming obsolete. [07:23] I remember my professor saying, “People don’t want a drill, they want a hole.” Such a simple shift, but it completely changed my brain and approach to business at that moment. [09:15] Melina shares a story about Henry Ford from Harvard Business Review.  [11:47] Ford put customers first. He found a price where the masses could buy a car and then figured out how to build a business to make it happen. [14:13] Thinking about customer experience is always a great place to start. [15:31] Any business model takes work to create value and be something people want. [17:41] It is important to think through what you will be offering and how it compares to what you do now. [18:04] A subscription is something that people pay for on an ongoing basis and they get access to a product or service. [19:52] Another model for subscriptions that has become very popular is the “free version” and “paid version” models. [21:05] The difference with a membership model is that you are typically paying for the right to have access to things, but you don’t necessarily have to take advantage of everything included. [23:24] With a membership, you still have the benefits of a subscription type model, that you can plan for payments to be coming in regularly, and the people who sign up get more for less than what they would pay for single-use or to buy all the things themselves. [25:05] If you are on retainer, someone is prepaying for access to you for a certain number of hours. [26:24] Is a membership or subscription right for you? Walking through a “writing club/coach” example.  [28:36] You will need to do the upfront work to set everything up, but eventually, you could hire someone to manage most of the group stuff, so it doesn’t take up too much of your time, which frees you up for more time at your $200 an hour rate. [29:54] Taking the risk out makes it an easy yes for people.   [31:40] If you do set up a membership group or subscription, consider launching at a discounted price for a very limited time to help set up a foundation of participants. [32:32] People pay for all kinds of things and are happy to do so when they know what the value is. [34:01] The value proposition is clear because there is an established “other option” that is more expensive.  [35:07] If you don’t consider and establish the comparison point and point it out with the proper high anchor, your selling conversations will be a lot more difficult. [37:06] Framing, anchoring, relativity, and knowing your value are very important in the way you communicate any opportunity. [39:13] Instead of creating an offering that seems like the best fit and offer for your business and then finding a way to sell it to people, start with what they want and find how that can be done by your business and if it is actually a fit for you. [39:38] Trial periods are really helpful in letting people see the value of the offering, so they can be useful. [42:18] I tell clients all the time that not everyone is your customer. [43:36] Narrowing down your scope makes it easier for people to find you, know you are a fit for them and have confidence in your offer. [44:57] The first step is to know what you want to nudge people toward, what the best offer is for your business. [46:49] There are lots of different ways to frame the message and help it to showcase what is the best fit for your business. Try to think outside the box.  [47:52] You can do whichever makes sense for your business so there is no “only” way to price. You should go with two options max.  [48:37] When it is a monthly payment, you are able to get the value as those payments are made, in smaller doses, versus needing to help the conscious brain justify a large amount once a year, where you could lose people. [52:49] It is definitely easier to sell things when you have a solid email list. [54:40] Once you have done some of this prep work to find what your niche will want, just go for it. Build it, pick a model, choose your pricing, and sell it.  Speaking of membership groups, now is a great time to join the BE Thoughtful Revolution - use code BRAINY to save 10% Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube More from The Brainy Business: Master Your Mindset Mini-Course Brainy Mindset Course - use code BRAINY to save 10% BE Thoughtful Revolution - use code BRAINY to save 10% The 10 Behavioral Economics Concepts You Need To Know (and how to apply them) ebook Brainy Pricing Course - use code BRAINY to save 10% Articles and Past Episodes: Paper Scissors Paint Art Studio Marketing Myopia 95. Hate Being on Camera? Understand Your Brain’s Biases To Change Your Mind 15: Availability: Why People Are More Likely To Get Flood Insurance Right After a Flood: A Behavioral Economics Foundations Episode 34. Optimism Bias: The Good And The Bad Of Those Rose-Colored Glasses: A Behavioral Economics Foundations Episode 39. Expect Error: The “E” in NUDGES: A Behavioral Economics Foundations Episode: A Behavioral Economics Foundations Episode 9. Loss Aversion: Why Getting New Stuff Is Not The Same: A Behavioral Economics Foundations Episode 21. Habits: 95% Of Decisions Are Habitual – Which Side Is Your Business On?: A Behavioral Economics Foundations Episode 16. Framing: How You Say Things Matter More Than What You’re Saying: A Behavioral Economics Foundations Episode 31. Mirror Neurons: A Fascinating Discovery From A Monkey, A Hot Day, And An Ice Cream Cone: A Behavioral Economics Foundations Episode 18. Priming: Why You Should Never Have A Difficult Conversation With Someone Holding An Iced Coffee: A Behavioral Economics Foundations Episode 51. Time Discounting: The I’ll Start Monday Effect – My Favorite Concept!: A Behavioral Economics Foundations Episode 71. Prefactual Thinking: How to Turn “What If” Into “Why Not” – Behavioral Economics Foundations 59. Pain of Paying: Why The First Item In A Purchase Is The Hardest: A Behavioral Economics Foundations Episode 47. A Behavioral Economics Analysis of Costco 19. Herding: Come On And Listen…Everyone Else Is Doing It: A Behavioral Economics Foundations Episode 87. Social Proof: How to Use Herding to Boost Engagement and Sales 11. Anchoring & Adjustment: The 1 Word That Increased Sales 38%: A Behavioral Economics Foundations Episode 12. Relativity: The Brain Can’t Value One-Off Items: A Behavioral Economics Foundations Episode 90. Habit Weekly: A Discussion With Creator Samuel Salzer 63. How To Set Up Your Own Experiments 97. Peak-End Rule: Why Averages Don’t Always Matter (A Behavioral Economics Foundations Episode)

Today, I am very excited to introduce you to Brian Ahearn, one of only 20 trainers certified by Robert Cialdini to teach on his behalf in his methods of influence. There are episodes of the podcast on reciprocity and social proof which are concepts featuring some famous studies by Cialdini, which have changed the way we communicate and persuade. In our conversation today, Brian will tell you about his book Influence PEOPLE (for which PEOPLE Is an important acronym). We also discussed a serendipitous moment from about 30 minutes into our pre-call conversation... Brian is a wealth of knowledge and a fantastic guy. There are links to connect with him in the show notes and to check out his book Influence PEOPLE, which is definitely worth the read. Listen up for the Post-It Note study - it will blow your mind! Show Notes: [02:04] In our conversation today, Brian will tell you about his book Influence PEOPLE (for which PEOPLE Is an important acronym). [03:34] Brian’s main focus over the last two decades has been working with salespeople, but he also works with business leaders, business coaches, and attorneys.  [03:47] Brian’s strength is the application of the psychology of persuasion.   [04:18] There are only 20 people (including Brian) who are certified around the world to teach the Cialdini method.  [07:34] Cialdini was so excited as they shared how they were taking his life’s work and using it to better their organization, selves, and relationships. [09:20] The book Influence PEOPLE was created to help people apply this research.  [10:16] The book offers very practical examples in short chapters to help readers put the research into action.  [11:48] Brian shares a story from the book about a friend named Jim. [12:48] In an email if you reply to the entire group you can often put enough pressure on the members to encourage them to complete a task quickly.   [14:48] When using this example you can be general without specifically naming the person you are waiting on.   [17:14] Brian really works with people to get them to a point where they feel like they can totally run on their own.   [18:08] “There is nothing high or low, but comparing makes it so.” [20:01] The PEOPLE acronym stands for Powerful Everyday Opportunities to Persuade, that are Lasting and Ethical.  [20:23] It is powerful because it is backed up by research and it is an everyday skill.   [21:17] When Briain talks about persuasion he doesn’t mean only changing hearts and minds, he also means changing behavior.   [22:15] If it is done right, sometimes it can lead to lasting change.   [22:21] It all has to be done with an ethical framework.  [22:51] Brian shares about the Post-It Note Nudge.  [24:10] Using a sticky note will probably get a lot more people to do what you are asking them to do and has many other benefits.  [26:56] Brian shares a story about a community that added a sticky note on an info flyer about a bond issue.   [28:46] The moment when we need to use these tools most is when our brains are most likely to be overwhelmed. Our subconscious is likely to take over and we are going to revert to what has worked or we have done in the past.   [29:25] Always stop and re-read an email before you send it.  Ask yourself, “Is there anywhere I could be more persuasive?”  [31:01] Ending on a question is so important and it increases response rates.  [32:06] Brian learned that if he asked one question at the end of the email, people would often come back with longer, more thorough responses and it increased his personal brand.   [34:21] People do business with people they like and want to be associated with. [36:45] Melina always ends really important emails with a question and she has seen it boost response rates.   [39:39] Brian shares the story about the photocopy shop and how we are so conditioned by the word “because” as we grow up. [40:41] If you need someone to do something, ask them, say “because” and give them a reason.  Also, don’t ask on the drop-dead date.  [44:52] The Post-it note is able to cut through the subconscious filter and draws attention to something being different [46:05] Next week, in episode 105 we are going to be talking about subscription models, different businesses that apply them, and how to be thinking about them in your business.   Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube More from The Brainy Business: Master Your Mindset Mini-Course Brainy Mindset Course - use code BRAINY to save 10% BE Thoughtful Revolution - use code BRAINY to save 10% The 10 Behavioral Economics Concepts You Need To Know (and how to apply them) ebook Connect with Brian: Brian on LinkedIn Brian on Twitter Influence People Website Influence PEOPLE: Powerful Everyday Opportunities to Persuade that are Lasting and Ethical Articles and Past Episodes: Influence At Work Copy That Pops Laura Petersen on Facebook Laura on Twitter Laura on LinkedIn Laura on Instagram 23. Reciprocity: Give A Little, Get A Lot: A Behavioral Economics Foundations Episode 87. Social Proof: How to Use Herding to Boost Engagement and Sales 96. How to Make it Easy to Do Business With You With Nikki Rausch 101. Dan Ariely Interview: Discussing Shapa, the Numberless Scale 88. Marketing to Mindstates: A Discussion With Author, Will Leach 72. Friction – What It Is And How To Reduce It, with Roger Dooley 78. How to Become Indistractible, Interview With Author Nir Eyal