A study done by a pair of Canadian psychologists uncovered something fascinating about people at the racetrack.
Just after placing a bet, they are much more confident of their horse’s chances of winning than they are immediately before laying down that bet.
Of course, nothing about the horse’s chances actually shifts: it’s the same horse, on the same track, in the same field.
But in the minds of those bettors, its prospects improve significantly once that ticket is purchased.
What has this got to do with financial planning?
Although a bit puzzling at first glance, the reason for the dramatic change has to do with a common weapon of social influence which is brilliantly described in Robert Cialdini’s bestseller Influence: The Psychology of Persuasion (Collins Business Essentials).
Cialdini explains that this ‘weapon’ lies deep within us (as humans), directing our actions with quiet power. It is, quite simply, our nearly obsessive desire to be (and to appear) consistent with what we have already done.
Once we have made a choice or taken a stand, we will encounter personal and interpersonal pressures to behave consistently with that commitment. Those pressures will cause us to respond in ways that justify our earlier decision.
Take the bettors in the racetrack experiment. Thirty seconds before putting down their money, they had been tentative and uncertain; thirty seconds after the deed, they were significantly more optimistic and self-assured.
The act of making a final decision – in this case of buying a ticket – had been the critical factor. Once a stand had been taken, the need for consistency pressured these people to bring what they felt and believed into line with what they had already done. They simply convinced themselves that they had made the right choice and, no doubt, felt better about it.
What Consistency Has To Do with Financial Planning
Imagine your potential clients. They have made financial decisions in the past what took them quite some time to decide what to do. Placing your bet on a racetrack is easy. However, making a financial decision can be really hard.
So when people are consistent about a minor decision as placing a bet, how consistently do you think people are after making a ‘big’ financial decision?
Why Consistency Can Be a Good Thing
People are not to blame for this attitude. In our culture consistency is highly valued. And well it should be. It provides us with a reasonable and gainful orientation to the world. Most of the time we will be better off if our approach to things is well laced with consistency. Without it, our lives would be difficult, erratic, and disjointed.
In our culture consistency is highly valued. And well it should be. It provides us with a reasonable and gainful orientation to the world. Most of the time we will be better off if our approach to things is well laced with consistency. Without it, our lives would be difficult, erratic, and disjointed.
But because it is so typically in our best interests to be consistent, we easily fall into the habit of being automatically so, even in situations where it is not the sensible thing to do. Such as continuing your relationship with your current financial advisor.
When it occurs unthinkingly, consistency can be disastrous.
Nonetheless, even blind consistency has its attractions.
Like most other forms of automatic responding, it offers a shortcut through the density of modern life. Once we have made up our minds about an issue – such as our financial decisions in the past – stubborn consistency allows people a very appealing luxury: we really don’t have to think hard about the issue anymore.
- We don’t have to sift through the blizzard of information we encounter to identify relevant facts.
- We don’t have to expend the mental energy to weigh the pros and cons
- We don’t have to make any further tough decisions
Instead, all we have to do when confronted with the issue is to turn on our consistency tape, and we know just what to believe, say, or do.
We need only believe, say, or do whatever is consistent with our earlier decision.
Do you understand now why some people don’t want your financial planning service?
It’s not that they don’t need you, don’t trust you or don’t believe you. They are unconsciously consistent with their earlier financial decision.
What To Do To Break the Consistency
To (unconsciously) break people’s commitment and consistency to their earlier financial decision, you have to influence them to be committed to you and your services.
Because when they commit themselves to you, they will be consistent with what they have chosen to do (remember the horse racetrack).
Because nowadays people are exploring your website before making personal contact, I’ll show you what you can do to make your potential client committed to you by using your website.
1. Ask people to substantiate their decision
Read this 2 short stories first:
Short Story #1:
Researchers called a group of people asking them how likely they were to vote in an upcoming election. Those who responded positively were either asked nothing or asked why they felt they would vote. Any reason would suffice, but when the election day came, the turnout for the control group (who all responded “Yes” to the question of whether they were going to vote) was 61.5%.
Turnout for the group that actually gave a reason (any reason)? 86.7%.
Short story #2:
A restaurant stopped telling customers “Please call to cancel your reservation” and started asking “Will you call and let us know if you need to cancel?” Net result? The number of reservation no-shows dropped from 30% to 10%.
What is that your website can do to make people say yes?
Start asking a question where people will have no other choice than to say YES to that question.
When you visit this website, the first thing you see is the following question: ARE YOU A FINANCIAL PLANNER?
So why do you think I’m asking you this …Financial planners can use a question like this: “Do you feel responsible for the financial future of your family?
Financial planners can use a question like this: Do you feel responsible for the financial future of your family?
2. Writing things down improves commitment
Read this short story first:
Group A was asked to volunteer for AIDS awareness program at local schools and was asked to commit verbally. Group B was asked for the same kind of volunteer project but was given a simple form to fill in. 17% of volunteers from Group A actually showed up to their assigned local school. From Group B 49% of volunteers showed up.
You can’t let people write on your website. But what you CAN do is make them either click or swipe.
This sounds crazy. You might think: “So when people click my site, it’s ridiculous that they are committed to me and my service”.
It’s what I thought at first. But please trust me on this one or read Robert Cialdini’s bestseller Influence: The Psychology of Persuasion (Collins Business Essentials).
What you have to do is to make it easy for your visitors to make them click or swipe. You can do the following:
- Let people click or touch your video
- Let people sign your online petition
- Let people sign in for your newsletter
- Let people fill in a poll on your website
3. The fact that circumstances changed allows people to change their viewpoints without being viewed as inconsistent
People are generally not thrilled to change their viewpoints on something, as they fear they will display a lack of consistency and be called a flip-flopper.
Convincing people that their old decision (to stick with the old product or their current advisor) was completely 100% correct under old circumstances, allows them to be more responsive to the messages that imply a new service is better because the circumstances radically changed since then.
What I often see on websites is that they are negative about the past or negative about some type of financial advisors. When you do that it has the opposite effect.
Because it scares your potential client away.
Are You Ready to Break the Consistency?
You might have these false assumptions about yourself, and that your future clients won’t leave their advisors for you.
Then ask yourself if YOU would change.
- Think about the timeYOU switched to a new hairdresser.
- Think about the time YOU switched to a new advisor.
- Think about the time YOU even switched partners.
Not because you ever thought you WOULD switch (in the beginning).
But later on, there was a good reason to do so.
So, give your prospects this reason.
Use the powerful tools that unconsciously makes you a little bit irresistible.
And watch them switch to YOU.
Do you want some extra help in fighting the consistency?
Then I have something for you.
It’s really powerful stuff.
Thank you for reading this post, and let’s make financial planning matter.