Book Recommendation
He had me at “The Economist.”
He being Dan Ariely, author of the new book Predictably Irrational: The Hidden Forces That Shape Our Decisions. It’s about the buying and marketing choices we make and why we make them. And why the seemingly rational path to a purchase is often the road less traveled.
Chapter one opens with an example drawn directly from the subscription promotions of my sometimes client The Economist. Which is why you’ll also find this article posted here.
Mr. Ariely’s second example involves real estate. Showing why most buyers choose the more expensive, and yet demonstrably less valuable property among the three houses he presents.
As a “behavioral economist,” Mr. Ariely organizes the book using the scientific method. In successive chapters he postulates a theory. Devises a controlled experiment. Tests his hypotheses. And reports the results … which are fascinating as well as illuminating. (Conduct a few tests on yourself: The door game. Easy-hard game. The circle illusion. Table illusion. Jastrow illusion. Stroop illusion. Line illusion. Checker board illusion. And Koffka illusion.
Predictably Irrational reveals that many best practices in marketing may, in fact, be predicated on myths. And it gives the lie to some long-held, fiercely-defended beliefs about customer behavior. But its greatest contribution is helping you achieve what I think is most missing in sales—whether real estate or subscriptions: The ability of sellers to think like buyers in accurate and advantageous ways.
These “hidden forces” will help you understand the true meaning of free. The concept of price anchors. The power of social motivation. If you’re in real estate, I think you’ll find it easy to take what you learn and apply it to the pricing of properties, the showing of homes, the marketing of listings. If you’re selling magazines, it may cause you to re-frame your offers, re-cast your benefits, and re-position your brand.
Now fair warning: Mr. Arieley has a grander vision than I. So he doesn’t draw the same conclusions from his data as I do. As a result, he tends to airily end chapters with sweeping pronunciations on the implications of his findings for everything from health care to tax hikes.
Me, I’m more interested in the practical than the political. So I skimmed and skipped those parts—reading Predictably Irrational much like I did The Robber Barons when just starting out in business. The more the author cast the capitalists as villains and the customers as victims, the more I admired—and understood— the motives, methods, and character of both buyers and sellers.
If you are interested in the ideas in Predictably Irrational, Dan Ariely has a blog, an MIT website, and the inevitable Wikipedia entry.
Three word review? Useful if true.
Greg Swann says:
Saved by the archives! I didn’t want to ignore this book, but I didn’t want to piss on it, either. Lucky me, I pissed on it before I ever knew about it:
Fortune favors the prepared mind — a comforting falsehood. 😉
March 14, 2008 — 11:56 pm