Nov. 4, 2021

How Does Behavioral Economics Apply to Sales?

How Does Behavioral Economics Apply to Sales?

Episode 20: How Does Behavioral Economics Apply to Sales? with Nick Mishkin
Behavioral economics is an academic discipline that studies the effect psychological factors have on our economic decision making, but how can we apply that to sales? Well, today’s guest is an expert in exactly this topic! Tuning in, you’ll hear how behavioral economics applies to sales from Nick Mishkin, public speaker, podcast critic, music promoter, and behavioral economic consultant. Nick specializes in applying behavioral science to business communication. Since earning his bachelor's degree in economics and music from the University of Pennsylvania, Nick has sold products for several companies across various industries; from music and advertising to SaaS, technology, and information technology. He is currently earning his MA in Behavioral Economics at IDC Herzliya in Israel and curates the popular Spotify playlist, Behavioral Economics. In this episode, we discuss the power of connecting with buyers on an emotional level, the relationship between behavioral economics and emotional intelligence, and how you can use framing and anchoring to rethink how to describe your offering. We also touch on buyer association, vulnerability, and loss aversion, as well as how you can benefit from finding commonalities with the buyer, plus a whole lot more! Make sure not to miss this insightful conversation with Nick Mishkin!


Key Points From This Episode:

  • Meet Nick Mishkin and find out how his failures inspired him to study behavioral economics.
  • What initially drew Nick to sales, including how it lends itself to his extraverted nature.
  • How he believes sales has evolved since he got started; the importance of management.
  • The constant need to onboard new technology and how it can overwhelm salespeople.
  • Defining behavioral economics: the study of human decision making.
  • Connecting on an emotional level rather than hyper-focusing on scripts as a salesperson.
  • The relationship between behavioral economics and emotional intelligence.
  • How salespeople can embrace behavioral economics by approaching calls in a different way.
  • Why managers need to become coaches as technology companies start developing emotional intelligence tools.
  • Learn the power of framing and anchoring; rethinking how you describe your products.
  • Nick uses an experiment by behavioral economist, Dan Ariely on the importance of irrelevant alternatives to illustrate buyer decisions.
  • Distilling framing and anchoring into simpler terms: descriptions and reference points.
  • Buyer association and experience and how they inform the reception of certain terms.
  • How to be the expert while remaining human and vulnerable as a salesperson.
  • Ask yourself: are you being yourself, are you being genuine? 
  • Loss aversion versus regret; which is a more powerful trigger for buyer decisions.
  • The value of authenticity and trusting the buyer not to buy something they don’t want.
  • Nick highlights the power of having the courage to be genuine and explain why.
  • Final thoughts: remember you’re talking to human beings, try to find commonalities.

Tweetables:

“Behavioral economics is the study of human decision making. That’s the most practical way to describe it.” — @Behavior2020 [0:11:05]

“Emotions [are] such a crucial factor in our decision making that, without talking about emotions and emotional intelligence, you can’t really talk about behavioral economics.” — @Behavior2020 [0:14:50]

“There’s a fine line between being an expert but also being human and vulnerable.” — @Behavior2020 [0:31:46]

“You’ve got to trust the buyer, that they’re not going to buy something they don’t want. Then, you also have to trust yourself, that you are being genuine, and you are presenting all the different options.” — @Behavior2020 [0:41:38]

Links Mentioned in Today’s Episode:

Nick Mishkin on LinkedIn

Nick Mishkin on Twitter

Behavior 20/20

Behavioral Economics on Spotify

‘The importance of irrelevant alternatives’

TED: Are we in control of our own decisions? with Dan Ariely

TEDx: The power of vulnerability with Brené Brown

Waking Up with Sam Harris

Sam Capra on Linkedin

The Sales Samurai B2B Sales Podcast

flexEngage

Title Sponsors:

Transcript

Speaker 0    00:00:01    Coming to you from Orlando, Florida, Orlando, Florida, and streaming around the world around the world. You're not tuned in to the sales samurai podcast. The only B2B sales podcast, providing unfiltered unapologetic views and tactics directly from the sales trenches. Here's your host, Sam Capra.  
Speaker 1    00:00:30    Welcome to episode 20 of the sales samurai. Thanks for listening. As always, before we began, do us a favor, take a moment to subscribe and download on today's show. We're going to be discussing how does behavioral economics apply to sales? And I have an amazing guest for us today. Nick Michigan is a public speaker podcast, critic, music, promoter, and behavioral economics consultant. Nick specializes in applying behavioral science to business communication since earning his bachelor's degree in economics and music from the university of Pennsylvania. Nick has sold products for several companies across many industries, music, advertising, SAS technology, and information technology. He's earning his master's degree in behavioral economics at IDC her's law in Israel and curious the popular Spotify podcast, playlist behavioral economics, Nick man. Welcome to the show. How are you brother? I'm  
Speaker 2    00:01:23    Good. It's it's later in Israel. I'm seven hours ahead. As you can see, it's it's dark in the background, but all  
Speaker 1    00:01:29    Good. Hey, now I'm talking to someone in the future. They said it wasn't possible.  
Speaker 2    00:01:34    Yeah, exactly. It looks bright. The future is always bright.  
Speaker 1    00:01:38    Well, at least we're past COVID right. Uh, at some point, right. And let's,  
Speaker 2    00:01:42    Let's, let's continue on to the next topic. That's  
Speaker 1    00:01:45    A whole separate podcast we could be doing. Why man, I am super excited to have you. I know, uh, today we're going to be talking about something that, you know, I'm actually going to be learning quite a bit on today's session because we're going to be discussing behavioral economics and really how does that apply to sales? Because there's a lot of correlations to it. I know that's something you're extremely passionate about. I think there's some great techniques and tactics that you're going to be discussing some also some foundational things for the audience. But before we kind of break into that, kind of give the eyes a little bit of a background on you kind of a little bit about yourself, Nick.  
Speaker 2    00:02:20    Yeah. So I'm in Israel now and I'm studying behavioral economics, but I wasn't always in Israel. Uh, I studied economics in my BA at the university of Pennsylvania where I also studied music and, uh, worked in technology sales for the last seven years. Uh, worked as a music promoter as well, worked for a record label at some time. And, uh, but while I was in sales, I, you know, I times of great success, right. I, um, I was sent to Montenegro. I was sent to, uh, AmeriCash, uh, St. Lucia for president's club. Um, but there, I had times of failure. I mean, there are definite times where I wasn't doing that well. And on those times where reflection, I was like, okay, what can I be doing better? And I recognized that there was just an emotional gap. Like it was hard for me to connect with clients on an emotional level, you know, they're human beings, right? I'm thinking about scripts. I'm thinking about all these different things, but I need to increase my emotional intelligence. So, um, I started studying behavioral economics on my own, became fascinated with the topic. Didn't understand why companies weren't teaching this specifically in sales and marketing. And I was like, okay, I'm going to go to school and try to fill this gap. That's  
Speaker 1    00:03:39    Awesome. So how long were you kind of, uh, carrying the bag if you will, how long were you kind of doing the sales thing?  
Speaker 2    00:03:45    I was in sales for seven years. Yeah.  
Speaker 1    00:03:47    So I'm always, I always like the origin stories. A w what got you interested in sales initially? What was kind of the reason for that, you know, move into sales?  
Speaker 2    00:03:58    Yeah. So as I started out in the music business, but I was doing, I worked for iHeart radio and I was on doing, uh, radio sales there for, you know, advertising spots. Uh, then I moved in to a company called tabula, which is an Israeli company. Uh, and then after that, I moved to a company called electric AI, which is a, I believe a series B series C startup right now. And, uh, and so, uh, yeah, those are the three companies. Um, I was working in sales at very different products, but, uh, all in technology,  
Speaker 1    00:04:31    I know no one grows up saying I'm going to be in sales. That was never the calling for anyone. What, what kind of pushed you in that direction initially? Just out of curiosity. Well, we're going  
Speaker 2    00:04:41    To talk a lot of psychology on this podcast and I feel it's important to be honest, right. One I'm, I'm naturally an extrovert. So I like talking to people and, uh, and sales just lends itself to that. And then second, I felt like, uh, salespeople got a lot of glory. I thought, uh, you're bringing in revenue for the company and when you're doing well, they're sending you to America and Montenegro, you know, I, so honestly there's an ego part, um, and an ego component to it.  
Speaker 1    00:05:18    Yeah. That's awesome, man. Uh, yeah, I mean, I think sometimes I get shrouded. I don't think there's anything wrong with acknowledging, Hey, I wanted to make money. I mean, I, I, that shouldn't be the end all be all to anyone, but I'm in sales. I'll be very candid. I, I got into sales because I wanted to dictate what I made. Right. And I knew if I sold more, I could make more, I didn't want to be capped at here's your 45 grand a year. And maybe every year you get a 10% increase or whatever it is now, that's what drew me to sales. And I was always comfortable sharing that. I wish I had some higher calling or some higher purpose. I just didn't to be quite candid with you all. Um, so Hey, Nick, I always this, because you've been in even, you were selling them for a good number of years. I always like to get people's opinion from the time that they started sewing. So for the past, you know, that seven, eight years, like, what do you think from a sales perspective has changed for the better and for the worse in that period of time, what you were in, you originally started to what you're seeing in the space today, better and worse in your opinion.  
Speaker 2    00:06:21    I think people are for a better, for the better. I think people are understanding the importance of management and how managers, shouldn't just be a person you report to, but should be more like a coach. So there's an awareness of that now. And that's a very positive thing now, how do we do that? How do we turn managers into coaches? That piece has not been figured out yet. And that's  
Speaker 1    00:06:42    The, that's the worst part. Don't  
Speaker 2    00:06:44    Worry. Yeah. The worst part, it hasn't been figured out. I mean, it's good that people are thinking about it. Um, I, I think companies, uh, you know, depending on if you're backed by a VC, right, you have a lot of pressure as a company and that pressure trickles down to the salespeople and the pressure is felt, um, if a private equity company buys you out and again, you have to make revenue. So I think there's just a lot of pressure, a lot of competition. Uh, those are negative things, a lot of ways to consume content, a lot of distractions because it's like, oh, you gotta be presenting. You gotta be the expert on social media. Oh. But you also have to memorize a script. You also have to memorize our sales process. Like there's also just a ton of content and things to memorize now. And that's all, that's a negative.  
Speaker 1    00:07:30    No, I, I don't disagree with you. You know, I, I asked that question because I love hearing people's opinions on and depending on when they started and you know, kind of what they're doing now, what they've seen through that time, because I think you would agree with this, um, know just sales and I'm sure a lot of industries, a lot of professions change and evolve, and we're not unique, but it seems like sales is constantly changing. Like what you did last week, two weeks ago, a month ago may not actually work in the next 2, 3, 4 weeks. Cause if it is people start to pick, you know, take it and run with it. And then it just becomes saturated. You got to try things different over, you know, different ways of doing things. And I agree with you. I think that's a challenge for sales, but for a worse, is there some challenges on just keeping up like, there's, you gotta be, keep not even leading. Sometimes it's keeping pace because of all these things that are going on around you and with your prospect or the clients that you're talking about.  
Speaker 2    00:08:26    Yeah. And you're onboarding new technology, right? Like there's a lot of different companies. One company, we were onboarding technology like crazy. And it was just another tool to learn. Now, once we learned that tool is helpful, but it's just so overwhelming.  
Speaker 1    00:08:42    It can be without a doubt, I feel for  
Speaker 2    00:08:44    You salespeople. It is, it is hard, man. Sales is hard.  
Speaker 1    00:08:49    Yeah. I think back to my early days in sales now I'm dating myself. Um, I'm old as the, as old could be, but my very first sales tool, I'd never forget it. I was at a company called Rollins truck leasing, and we rent trucks, truck, somebody it's pretty self-explanatory um, they literally, we didn't have email then, uh, they were getting email. It was all, it was the new thing out, but we didn't have a website. I think we just launched a website, but they literally threw, my first tool was officially the yellow pages. That was my very first tool. And they handed me the phone and that was all right. You're ramped up.  
Speaker 2    00:09:26    That reminds me of a Wolf of wall street when he starts it as a, his first company. He's just like, he's just like, why aren't you picking up the phone,  
Speaker 1    00:09:36    Jordan Belfort, let me, let's just say it was a, it was a rough for the very first, uh, 6, 7, 8 months, if you will. But also man, Hey, so let's hop into it because this is something that I am actually intrigued by and I'm not as up to speed on it. So I'm going to learn just as much as the audience going through this, but we're going to discuss this. How does behavioral economics really apply to sales? You know, how can sales, how should sales be looking at it and how can they apply it to be, to be better individuals be better salespeople, the whole nine yards. But my first question is like, just bring the audience up to speed. Like how, how do you really define behavioral economics? What does that really mean? If you will? Yeah.  
Speaker 2    00:10:17    So I'll start off with the more scientific way and then go into the more practical way. Uh, so economic economists, they describe how people should behave and they use what we call normative models and they assume people are rational and they're always trying to maximize their utility, behavioral economists. They describe how people actually behave. They have a lot of science that shows people aren't always rational. In fact, they're often irrational and they use what we call or we use what we call, um, normative models. Now, basically what I tell people is that behavioral economics is the study of human decision-making and that's the most practical way to describe it.  
Speaker 1    00:11:11    Gotcha. So, and I know you, you, I know we're going to get into the weeds a little bit on this, but you mentioned something earlier and I wanted to ask, I wanted to hold it back a bit. You said that when you were in sales, you really felt like you were missing connecting on an emotional level with prospects, with clients, whatever. Like what, what did that mean? Cause I think now that we have a little bit of context of what behavioral economics like help me understand what you were referring to, when you say I felt I could connect on an emotional level.  
Speaker 2    00:11:42    Yeah. So from that standpoint, I think one major issue is I was focused on a lot of different things like the scripts, making a certain amount of cold calls every day, moving this guy, moving this, uh, you know, man or woman, uh, client to the next stage in the sales cycle asking the right questions. But I pause this. Person's a human being. Like I should be having a conversation I should be coming from, I think, a different place than, Hey, this person can get me closer to my revenue target. I should come from a place that says, Hey, this is a human being. Let me try to make this person's day. Let's have a good conversation. Let me see what his or her story is. Uh, and then everything else will follow. Maybe,  
Speaker 1    00:12:26    You know, it's funny, I probably mentioned this on a number of podcasts that I think through the years or just how we've been trained or whatever the reasoning is from a sales aptitude standpoint, we did, we lost somewhere along the way that the human element of just having a COVID natural curiosity, just having a conversation. And it always becomes salesy. Like we always want to have the right line or the right something to say to spin it from an object. Like there's so many things that you've been kind of coached if you will, that we do lose that organic. Hey, I'm just curious and having a natural conversation.  
Speaker 2    00:13:01    Yeah, exactly. And I mean, it makes a lot of sense. Like when you have scripts, when you have all these different things, that's going to become robotic because that's what you're focused on. Um, but I think a lot of my just messaging my tone, a lot of things would've been different if I came from a different place and understood that this person has goals, has families has narrative identities. So they tell the stories about themselves. Why are they, why are they at the company? You know, uncover the pride they have in their own company. Like these are questions I didn't really ask, um, that, uh, I think would have made it the, the conversations more human  
Speaker 1    00:13:38    Without a doubt. I mean, it's a good catch. I'm glad you kind of elaborate on that emotional level that you felt you were lacking during the sales component of things back in your kind of your sales tenure. Um, so I always, I've been asked this actually offline. I'm wanting to, I wanted to know, take this for us. Like, you know, behavioral, behavioral economics, you know, that's the first time I really heard that is actually when we were talking offline, I've heard behavioral or emotional intelligence, are they the same? Like, should we be like, are they saying different? Or how do you bucket those things? They're,  
Speaker 2    00:14:12    They're different. Um, Daniel Goldman is credited with coining the phrase, emotional intelligence and behavioral economics goes back to almost some diversity in the seventies. Uh, and then Richard Thaler later, they're like the fathers of behavioral economics, so different schools, but I will, to my previous point of describing behavioral economics, well, why are we irrational? And that's because B because emotions cause we have emotions and social pressures, and these are things that a traditional economists usually don't account for. However, they dictate a lot of our behavior. So that's why they go hand in hand because emotions is so it's such a crucial factor in our decision-making that without talking about emotions and emotional intelligence, you can't really talk about behavioral economics  
Speaker 1    00:15:01    To get our arms around this. Right. Because it is kind of a big, it is kind of a big subject, but I'd like to get in touch with that. It reminds me of, you know, sitting on a couch, talking to a therapist and Hey, how you feeling? How was your childhood? Like, like how do you start to get your arms around this as a sales person, start to a recognize, am I good here? Or am I not like, am I the best I can be? And then how do I, like, what are some of the things that, how do you, I guess, Hey, identify it or, you know, take ownership of it. What have you seen Nick from that standpoint?  
Speaker 2    00:15:30    I think asking, coming, just approaching calls in a different way and saying, I'm going to make this person's day, rather than I'm going to put this like frame. Framing's a big concept in behavioral economics, right? How we describe something, changes the way people think about, um, whatever I'm describing. And for example, you can frame different messages in your mind. So when I get on a call, I can say, Hey, I'm going to, I'm going to take this person. I'm going to qualify this prospect one. I'm calling them a prospect already an inhumane kind of name until I'm moving this person in the same cycle. So I have agency, I have a goal. Um, and I'm calling this person a prospect. Well, if you just change the messaging internally and say, Hey, I am talking to a person and I'm going to make this person's day. And we're going to have a great conversation. I'm going to learn about his or her company. Um, she's going to learn about mine and let's see where it goes. Like I just think if you think in those terms automatically, you're going to have higher emotional intelligence and much more engaging, uh, real conversations.  
Speaker 1    00:16:39    Right? How do you, so I guess my coming put my sales leader hat on for a minute, and this might be maybe not even a real question. So work with me here a little bit, Nick, like, is that scalable? Like, you know what I mean? When I say scalable, like, you know, if I'm constantly putting myself in which, I mean, I think you should be definitely be doing, but like, you know, there's those numbers you gotta hit, right? You gotta hit so many meetings. You have so many opportunities, you got hit so much revenue that that's where all these automation tools have been formulated to drive efficiency and effectiveness. And then somewhere along the way, the emotional piece kind of got left to the side. But is it, is it scalable to give that much what's the right term? That much effort,  
Speaker 2    00:17:22    Not effort, but I got to understand like emotional cognitive, like, like emotional,  
Speaker 1    00:17:27    Uh, right. There's yeah. The emotional bandwidth, if you will, to every call, if I'm dying the old term dialing for dollars. Like if I have, you know what I mean? Like, so is it practical? Is it doable? Is it scalable? How does, how does the rep, okay, I acknowledge that. How do I start getting my arms around that? From a scale standpoint, could I still have to metrics? My boss wants me to hit  
Speaker 2    00:17:47    It. It's scalable on discovery. It's not scalable cold calls. You know, when you really have a win, those are more like rapid fire and cold calls is something we could talk about. I mean, I'm, I'm starting to think about how to, um, apply, uh, different behavioral economics and behavioral science tactics, so cold calls, but like, um, but I, I, first of all, there are tools being built now to increase emotional intelligence and things around on management, right. Managers, managers need to become coaches and there's certain you're gonna see, um, technology companies start, um, burgeoning because they are going to be developing these kinds of tools because there's a need. So in the future, the future looks bright for this kind of thing. Um, but, uh, but yeah, it's scalable on discovery calls. It's a scalable as the process moves down the funnel. But of course, like, I mean, you've got to get the prospects on the phone. Yeah,  
Speaker 1    00:18:47    No, without a doubt. So in the context of our conversation, we're kind of focused more on, Hey, we've got the meeting or we're preparing and we're getting on a discovery call. How do we just have a real conversation and connect with that individual on a more emotional level? And to your point, I like what you said. Cause it does make sense. You know, how many prospects have you reached out to day? It does kind of, it takes a humanity away from things to some degree, it's almost like a thing versus the person that you're talking about. Um, so I like that component of things. Um, so let's, let's kind of dig in there because you talked about a lot about framing is it's, it's the framework of how you just go about that. Like you said, there's some tools out there there's framing techniques. Can you give a little bit more around both of those areas?  
Speaker 2    00:19:32    Yeah. So I think first thing to realize is how you describe something and words matter. They, it really does. It can change someone's perspective. So, uh, first thing is just how you describe your product, right? Is, is my product, uh, simple or is it intuitive? Right? There are two, they're the same thing. One of them kind of sounds a little better. I mean, that's like kind of a smaller component. Um, now as far as framing and anchoring go, go hand in hand. So anchoring is when you have a reference point. So the, the number one rule in behavioral economics and the number one rule in all of human decision-making is that people judge reality based on reference points. The only way I know what value is, is if I compare it to something else. And the reason that's important is because that's what Frank Mangan anchoring is based on.  
Speaker 2    00:20:28    So for example, I'll give a good example of, um, of anchoring. So, uh, and it also goes into framing. So there is a study done by 11 and what he tested is where a customer is going to buy more. If I start off presenting a fully loaded product and, uh, have the client remove items, or if I start with the baseline product and then have the client add items or add features, and what he found is the buyer by significantly more, when you start off with the fully loaded product. And I think a lot of salespeople know that, but there's a few reasons and also good reasons to not like evil reasons. Like it's good for the, the, um, the buyer to, uh, it's a win-win and all. And I'll tell you why, because, um, first off, when you start off with the fully loaded product, first of all, this is framing in a different way, right?  
Speaker 2    00:21:28    Because I'm framing I'm describing the product is fully loaded versus baseline. So that's one way, and then I'm starting off with a different anchor. The anchor is now the fully loaded product while it was the, um, the baseline product. And then, uh, and you're changing the psychology and this is what's good about the buyer. I think buyers get wrapped up in the cost too much, you know, that could be come from social pressures, pressures from their boss. Like they want a good deal. You know, it's socially, we, we want to get a good deal. Like that's just in our DNA, but when you start off with a fully loaded product. So, so when you start, let's start, when you start with a baseline product and each feature is a cost you're adding on, it's getting more expensive, right? So now you got the buyer thinking about cost, but if you start off with the fully loaded product, each reduction is not a cost, but a hit to quality or reduction in quality. So now you have the buyer no longer thinking about costs. You flip the psychology and the buyer is now thinking about quality, which they're just going to buy a better product and not get so wrapped up in the cost because you framed the product differently  
Speaker 1    00:22:41    Just to make sure I'm kind of boiling that down. So by starting at a full solution and having them Windell it down, Hey, if I pull that out, it doesn't because it doesn't look like on the other side of that spectrum, Hey, cost increase for that, for that feature. There's another cost increase. So now that gets their mind around more money, more budget, more money, more budget versus going the opposite direction. It's taking it down, but I'm not thinking about cost. I'm actually thinking about, Hey, what's that doing to the quality, right? What am I going to miss out on by not having that functionality?  
Speaker 2    00:23:15    Yeah. That's, that's exactly right. And it's the same products, same solution pulled into different way. That's the only thing that changed. And yet, yet everything changed. Right?  
Speaker 1    00:23:27    Doubt. I mean, you're right though. I mean, how, you know, I can remember my days of building those out and we'll, do we start with everything, give them an option one and option two, or do we just go with, you know, an option one and only, and it was really just us putting our finger in the air and say, I guess it's just do this, right? There's no method to the, but by you articulating that, that allows us to put a little bit more understanding and well, why are we crafting our pricing or structure that way? Does that, does that actually resonate with how people buy? Because that that's obviously what we want them to do. Correct.  
Speaker 2    00:24:00    And that's, and I think there's a couple of things that, so you brought up some really good points, one that's confidence, right? So I've been told, like, I've been told by a manager, like, make sure you put three options and I'm like, but they're not going to pick that option. We know that he's like, no, but you need it in there. And the reason we need it in there is it because it shows the relative price of the other options. As I said, you're constantly comparing. So Dan Ariely has a famous experiment with, um, the economist, the website, where, um, at first they are, are at first they're offering a digital subscription or digital and print. Digital is around $60. Digital and print is around $125. Well, what's everyone going to do, they pick the digital, they're not going to pay that much mind more money for some that's twice as much for, for print, no way.  
Speaker 2    00:24:52    Uh, however, when they added a third option that said print only for $125, the same price as print only and digital. So just to review that you have digital subscription, $60 print, only $125 print only, and digital $125. It's increased, uh, the amount of print and digital by about 60%. So you added something print only, which no one's going to buy, but it changed the, you now have of Relic. You now have a value for what print costs and for like, for what print and digital, like the difference in the relative costs. It's like, you're getting print for free. You're like, wow, print costs $125. I'm getting print for free, but that's  
Speaker 1    00:25:39    How the buyer rationalizes it. Right? That's the context the buyer uses to say, is that a better deal than that? Is that fair to say?  
Speaker 2    00:25:46    And also, like I said, I don't want, I don't want this to just come from like an evil place. It's not trying to trick anyone. It's making the buying decision a lot. The buyer has the decision in the end, but they need to be able to compare things like, or, or the buying process is going to be awful for them. And I, you know, it's important that they have a, a good process. Um, something else that you said, by the way, as you said, when you're doing, when you're giving different options, you use the word option, right? Option one, option two, option three, name them, name the options. This is basic. Yeah. Premium, but like, think about it more. Cause that's framing, that's, that's, um, humanizing your product. That's telling the story a little bit out of your product as well.  
Speaker 1    00:26:33    So Nick, give us a little bit because we're going, I like where we're going with it, because help me understand, like, if you were just to boil down framing, like it has barest element, is it that just the approach? Is it just the verbiage is like, how would you like for someone who's dumb, like me next? Like how, if someone's like, what are you talking about framing? Like, what does that really mean? Like it it's barest element  
Speaker 2    00:26:54    Again, this is, it's kind of different for, depending on who you ask. Uh, but Danny Conoman has a famous saying that people don't choose between things they choose between descriptions of things and the description is the framing. So it's basically taking two things out of the same and describing them in a different way so that it clicks with, uh, the person who has to make the decision  
Speaker 1    00:27:24    It's where the words matter. Right. That that's, that's where the words make a difference. Because if it's based on the description, right. That's, that's where the rubber meets the road. Right? Nick, where my all fades. Yeah,  
Speaker 2    00:27:33    No, that's where the words matter. Um, that's where the words matter loss aversion is a big concept and they real economics, which you've probably heard before. Um, you know, are humans living to, uh, to maximize happiness or are we living to avoid regret, right. They're kind of the same way of living, but like they're totally different approaches. And one probably is much healthier than the other. So that's the same thing with loss aversion. Um, we, we hate losses. And what condom InterVarsity found is that if you frame things in terms of losses, uh, it scares people. It evokes a grit, uh, regret or the chance of regret and they make different decisions based on it. So that's where all this framing came from, uh, from there, from their, uh, experiments. Uh, but it also translates in many different things as we've, we've discussed  
Speaker 1    00:28:28    Now, where does anchor, so you're blending that down. What does anchor kind of mean just from a holistic standpoint, just from up from a very bare element.  
Speaker 2    00:28:36    Yes. An anchor is a reference point. So if I, how do I know if something's a loss or if it's a gain? Well, I'm comparing it to a reference point and that's basically what it is. It could be anything by the way, an anchor doesn't have to be a number. Um, an anchor can be expectations, right? When I, when a client gets on the phone with you, they already have expectations for how the call is going to go. They have expectations for what your product does. You know, it's your job as a salesperson to learn what their expectations are and then tell them the truth. Tell them what your product actually does are their expectations. Real chances are, it's probably not, you know, probably not accurate because expectations usually aren't real, but that's just an example of an anchor that isn't new. Right. That's good.  
Speaker 1    00:29:20    Hey, so cause you brought this up and you just mentioned it again. So I wanted to kind of pick your brain on this a minute because you know, words do matter. I think you're like, I think he, I think he used the term simple or intuitive or something like that. And they're similar words, but they're different, right? They take a different meaning in the mind, if you will. And you know, I've been, you know, I think we're all on and we see all these experts and talking about stop using this phrase, you know, ROI or whatever the phrases are, the coin phrases of things. And it got me thinking about what we're talking about here. Like why, why does the term become bad all of a sudden, like why stay away from those terms? I can't remember all of like ROI and you know, minimal time to invest. I, I can't remember what they are, but there's terms that come into, come into those picture, like use these terms. And then there's things that fade out what drives those things. Because I look up, I'm like, well, 80% of my emails use all those things in there at some point, like where do those things stem from? If you will, Nick,  
Speaker 2    00:30:21    You basically answered the question. You're getting 80 emails all with the same word and you're going to associate them negatively because no one wants to get 80 emails. No one wants. And when they see that word plus 80 emails, like they're already associating that word with something negative. So it's really association and experience.  
Speaker 1    00:30:39    Got you. So it's really the association of it being so saturated that it almost takes a negative connotation on the buyer side. So how does all of those things jive in with personas? Right? I mean, like for someone that is a much more, Hey, I want to get to know you, Nick and I want to get, build a relationship versus someone that's very tactical. Like, Hey, tell me what you could do. Let's not, let's not charade things with, Hey, how's the kids and all that fun. Like, does it take a different meaning approach based on who you're talking to?  
Speaker 2    00:31:09    Yeah. I mean, based on who you're talking to, you got to mirror their, uh, their tone. Definitely. It depends on who you're talking to, but, um, you, you are sale. Like you are the expert, right? If, if, uh, if buyers had all the information and buyers were completely confident to buy million dollar products, they wouldn't need salespeople, but you need to be on buying something. Like there's still a, an information gap there. There's still a need for salespeople. So like you have to be the expert. And like, I know that's cliche, but like, it's true. That doesn't mean you need to be like this, this, you know, like very, you can be, there's a fine line between being an expert, but also being human and vulnerable. So Bernay brown is someone that I really admire. Uh, she has one of the most popular Ted talks.  
Speaker 2    00:31:56    So I encourage people to check it out. And she talks about vulnerability and the social stigma of vulnerability. So we feel, um, that it's, we, we can't show weakness, right? Showing weakness, showing emotion, showing vulnerability, uh, it's going to lead to negative things and people are gonna take advantage of us or people. Aren't going to think we're the expert. No, if we show vulnerability, it just makes us human. And Bernay, Brown's Ted talk talks about how you actually, how people actually respect vulnerability and connect with people who are vulnerable. So yeah, instead of being this macho person who like this, the sales person who walks in the room and theme music comes on, you know, like you see in the movies, like you're a be an actual human being and, uh, show some vulnerability of, uh, you know, admit a mistake or a, don't be a, don't be afraid to tell a joke in an email. I mean, be careful, but like, don't be afraid to tell jokes, dude, are you a joke? Teller? Great. Like, like I had problems with that. I am, I, you know, I'm pretty like goofy person and I wasn't goofy on the phone and like, why, why am I not showing my personality? Why am I afraid to show my personality? Does it make sense?  
Speaker 1    00:33:13    You know, it's funny, you hit it, you hit a hit a big point there. And I, for some, for somewhere, I think it gets tied into what we were talking about earlier, somewhere along the way we got, we all blend into the stereotype of a sales person. Like they gotta be, I know you said you're extroverted, but I'm actually not an extrovert. I'm pretty much introvert. I'm not, I'm, I'm more introverted than I am extroverted. Um, and you gotta be, uh, you know, you've got to be a cheerleader in some aspects and you got all these things that people have said, sales. We gotta be a real people person, this whole nine yards. But if you're not that, that doesn't mean you're not going to be successful in sales. It's just be your genuine self. Like to your point, the facade of, Hey, I'm going to tell you a joke, because I think that warms you up, like doing those type of things is disingenuine and it's not who you are. So we'll always come off as a facade. Right? I mean, I think, I don't know where we got down that path of being something we're not maybe to get to. I don't know. But that, that kind of stirred that up in my head when you were talking,  
Speaker 2    00:34:14    I mean, you're asking yourself the right questions. I, I think about the question. When did we get to the place where we're trying to be someone we're not, I think about that all the time. I mean, that's why I study what I do. Like what about the social pressures make us behave in ways that don't correlate with our personalities. And I think you have to ask that question. Are you being yourself? Are you being genuine? Uh, so it's very extremely important.  
Speaker 1    00:34:40    That's all. So you were talking about, we were talking about this offline. I think you've mentioned earlier, there are tools out there for people that are saying, Hey, I don't know if I'm, if I'm the best I could be at this, or if I'm even doing it, like, cause a lot of this is subconscious. Is this more subconscious or is this actually a conscious, like where do you fall on that?  
Speaker 2    00:34:58    So, uh, first of all, I learned most of this or at least got excited about it. Uh, through podcasts. I love podcasts. Um, I, uh, curate a popular behavioral economics podcast playlist on Spotify. So people can tune in and watch all of the different interviews that, that they want. Um, so that's how you just hear and you hear, and you hear about it. It's gonna trigger in your brain. Um, meditation, uh, is, has really helped and I'm big advocate for it because it, it just brings things that are typically unconscious into your conscious mind. So you're thinking about walking, you're thinking about how you're talking, you're thinking about all these different things that you normally don't think about. And just by doing that practice, now you become more human. Yeah.  
Speaker 1    00:35:50    You know, I, I, as we've been even having this discussion, you know, I'm, I think I'm, I'm probably more of a practical person than I am pie in the sky. So I even think back to some of the calls I've been on and I've been evolved and I'm like, I'm actually starting to question myself like, well, why, why did I handle it that way? Like that? Wasn't not that it was dishonest by any stretch, but it was just like, was that my true self there? Like it was, I, was I putting, was it a win win in that scenario? Both ways. Was that a win for us win for them? Was I treating them? You're the way that we're talking about here and allows you to, I think kind of my thought process on this is that first acknowledging it and just questioning it to your point earlier, that's the first step, right? It's just evaluating it. Am I doing what I can be doing? Is that  
Speaker 2    00:36:37    Fair? 100%. I mean, awareness, are you being yourself? Uh, yeah. And, and, and I think, you know, if you're like a joke, if you're in not being, like, I think everything stems from fear. So like you're afraid to be yourself and questioning social pressures like that. That's where it all comes down to. Yeah.  
Speaker 1    00:36:58    Hey, you brought up a good point earlier that people are typically driven by success or failure. I know that there's a couple aspects to that. Have you found through the research and just understanding kind of like you said, most people, if you talk about loss that creates that fear of missing out or that your FOMO, wherever they call it nowadays, like, is that, is that a stronger trigger than fear of gain, fear of loss, the fear of loss and the need for success or the need for whatever the case might be.  
Speaker 2    00:37:31    Yeah. So the literature tells you that we tend to avoid regret. We like, even if there is, let's say we have a 80% chance where we can make a million dollars, but a 20% chance we'll lose a million dollars. Like the 20%, you have a better chance of making a million dollars, but you're probably like, well, okay, what if, what if I accidentally or not accidentally, what if I lose that, that a million or a million dollars? Um, and so you think about either you're so afraid of regret, you're so afraid of making the wrong decision in this case, in the you're gonna have to live with that decision. Uh, so yeah, loss aversion is extremely bad.  
Speaker 1    00:38:09    I, the fact that we're, we're talking about that. I think there's another tactic that lies in there. And we've talked about this before, you know, um, offline in separate podcasts is that you should be able to do almost a risk assessment pro as a sales person, like, you know, risk reward all comes down to that. And then how do I understand what the potential risks are for you as a prospect? So I can eliminate some of those to your point, because I find that there's even a 10% chance you're going to lose a million dollars. I know that's echoing in your mind somewhere. So how do I mitigate that? Or how do I help you work around that? So you feel confident that that 90%, the risk versus reward is far more in your favor. I think addressing that and getting ahead of that being proactive is actually something we could be doing as a sales person to be better and get our arms around as well.  
Speaker 2    00:39:00    Absolutely. I mean, the only way to know is to ask, like, we can't assume we're all, people are very different, uh, and it's very unsafe to assume anyone's thoughts and in, yeah. Like asking what they're afraid of or what they were like, framing it differently. I don't know if afraid of, but like what, yeah. What other risks at stake? Uh, I actually, um, so I was selling to a, uh, one of my previous companies. I was selling to an Israeli company attempting to sell and, uh, and like, it didn't end up working out, but I had a lot of conversations and I actually met with that client in Israel because they're an Israeli company. And he told me about that. He was, um, he was afraid about more of like the management, like the account manager, not the account, like once they actually onboard this tool, like the constant management, it was a fear, there was a lack of confidence. And I didn't know that, how did I not know that as a sales person, either we didn't build enough trust. I wasn't asking the right questions about risk because that's a perfect example of some place where I missed the mark.  
Speaker 1    00:40:14    Yep. No, that's fair. Hey, I, it brings you to a point that we were talking about earlier. Um, and you know, I brought it up. We need to be more human. I think that was your element. Is that the emotional connection with the prospect and, you know, understanding kind of just talking to them, having a conversation with a make their day, if you will. I think that's the term you used, but let me ask you this thing, because I think you've probably run into these people. Uh, they can have a million conversations with someone and like, that's all they want to do. Like they're just friend makers. Like, I, I, I must have, I must have talked to a bunch of salespeople that they're still talking to people that they talked about six years ago that they never sold, but they know their aunts, their uncles, their kids, like, there's a fine line there, right. Between being like, I want to say being human, but there's a fine line there. Right? You got to know that I won't say line in the sand, but you've got to be able to understand where those two things merge. Yeah.  
Speaker 2    00:41:12    I think that's a term of, uh, authenticity. And going back to what you said about being the extrovert and introvert, Daniel pink says it's best to be both, right? Like you both like in the middle, like an extrovert and an introvert, which I thought was interesting. Cause I think it's always like salespeople need to be extreme extroverts, but now like dial it back a little bit. Um, at least as Daniel Pink's advice. I, but yeah. I mean, there's there, you gotta trust the buyer that they're not going to buy something they don't want. And then you also have to, uh, trust yourself that you are being genuine and you are presenting all the different options and, and making the buyer, making, making a good, a good decision in the end of whether this product is for them or not. And if they do buy the product, which features of the product are the best, that's  
Speaker 1    00:42:01    Fair. Hey, I actually had one, a buddy of mine. That was a fantastic sales guy. I think he kind of, I don't know if he did this intuitively subconsciously, but he seemed to be very much what you're talking. He was very good about being, just being human, being himself. He was his authentic self. He knew who he was and he adopted it and he owned it. He was able to build great relationships, but he would, he had the ability to figure out, Hey, I've been talking to you for six months. I love you, man. Like a brother, but he wouldn't be able to say, listen, if we're not going to do business, just tell him that we're not going to do business. We'll still be friends, but I got, I gotta make some money somewhere else. So we'll still be friends, but just let me know what I'm missing here.  
Speaker 1    00:42:43    And that frankness was also authentic to him like that. They, they weren't blindsided by that, by any stretch of the imagination, they were like, you know what, here's where I'm at. And here's why. And they would actually give him something tangible that he can either work with or do what he said, Hey, let's move on this. Isn't for you. But I'm still, we're still going to be, you know, have a relationship if you will. And I always liked that candor and I always questioned myself, like, do I, is that me? Is that how I'm wired? If I'm not wired that way, then how do I have that similar conversation if you will? Oh  
Speaker 2    00:43:14    My God. Let's get that guy on the, on the podcast. Oh my God. What, what courage. But absolutely. Right. So there is a study done where, um, some, there was a long line to make a photocopy, right? Like an office and someone cut the whole line and was like, Hey, can I make a copy? Uh, and didn't explain why, like everyone got upset at him and didn't let him cut the line. If all he did was say, Hey, like, can I, um, can, do you mind if I cut the line, I'm really in a hurry. They're like, oh yeah, go, go ahead. They just have to explain why he just had to explain why he wanted to do the copy. Like have the courage to explain why and what your friend did is tremendous. Like it came off genuine. And also it was like, Hey man, like I have a job. Like, this is what I have to do. You do have a job. That's true. You do have to make money for the company. You know, I'm not telling you to be like, uh, just talk about feelings all the time. You have a job to do. Uh, but like, yeah. Be genuine about it. Have the courage to be genuine. Explain why you're doing some of the things you're doing. And if you need to move on, like you're moving on and explaining why,  
Speaker 1    00:44:19    You know, it's funny. He was the same guy, one of my, one of my early, thank God. Cause I told you I got thrown off yellow pages. And if it wasn't for him, I wouldn't be in sales today to be quite candid with you. Uh, he, he really taught me at a high level, you know, cut bait, keep fish. And like, you've gotta be able to know when that, when that point is in a deal and it doesn't mean that they're not a good prospect or a good company to work with. They may come back around, but your time is just as valuable as Thursday. And you not, you gotta be confident in that. I think that's a learning that you go through early in sales that hopefully you learn faster than, you know, sooner than later. Um, but it's one of those types of things that I always lean back into. Um, especially as we're having this conversation.  
Speaker 2    00:45:04    Yeah. And like, to it know, to admit being vulnerable, I was not good at that. Uh, I was holding on to sales for much longer than, um, than I should have. And that was out of fear and it wasn't good for the customer. It wasn't good for me. Um, so that wasn't, so I totally agree with that. Something you, you also said that that resonated with me.  
Speaker 1    00:45:23    It wasn't how good looking I am. I know that that didn't resonate. That very rarely resonates with anyone. So we're going to transition. And so, Hey Nick, just final thoughts, feedback, questions. I mean, just thoughts for the audience. Yeah. I just  
Speaker 2    00:45:35    Think, uh, you know, first and foremost, you're talking to human beings. Uh, so just come at approach, um, come with that kind of approach. Uh, you're juggling a lot. It's a very hard job to do. It's very difficult. Also, if you're calling on CEOs or CEOs, uh, they also have salespeople, they understand why you're making the calls and why you're doing the things you need to do. So there's a, there there's that feeling of empathy that they have for you. So it goes both ways. I think, try to find commonalities should also be a goal. Um, one thing I'm thinking about with cold calls is when you call someone rather than, you know, diving into your product or like, say, Hey, like, you know, is this Sam, oh, see, I'm like, you've been in technology for the last 15 years. Right? Yeah. And like, you're, oh, that's awesome. Like I'm in, I'm in high tech too, you know, you're already establishing that commonality. Uh, and then that people just like commonalities, they really gravitate to it. Uh, and yeah. And then, um, yeah, just think about the words, words matter. Think about how you're describing things and uh, yeah, that's, uh, that's about it. And then also just know that people are constantly comparing things. Uh, your clients are comparing things. We talked a lot about anchors. Uh, so yeah, just keep those in  
Speaker 1    00:46:55    Mind. Yeah. I love the, the anchor and the framing of things, you know, framing the description components, you know, what's going to be, you know, what's going to resonate and then the anchor, you know, what is the point, right? W w what do you kind of gauge? Uh, again, so I love that aspect of things and the whole use case we were talking about, you know, give them everything, let them Windle it down, losing a value versus building it up and increasing costs. And then that was fantastic. Um, how does the audience get ahold of you? How do they connect with you, Nick?  
Speaker 2    00:47:24    Yeah. So the number one way is on Twitter. So you could find me a behavior 20, uh, and then LinkedIn as well, and check out the, uh, the Spotify podcast playlist, which is called behavioral economics. Uh, and also, if any, if any of your audience is interested in the meditation, uh, I listened to the waking up app every single day. It's Sam Harris's application. And it doesn't only go into, uh, the like stress, you know, stress relief, right? A lot of people think of meditation as stress relief. It goes into the theory behind meditation. And that's why I particularly like it.  
Speaker 1    00:48:03    That's awesome, man. Well, Hey, thanks again, Nick. Sincerely appreciate you being on. You need to go get some rest over there and it is getting late. Well you're seven hours ahead, right? Correct. I would have been in bed an hour and a half ago. So you could, you could do the map that tells you how old I am. Uh, but thanks again for coming on, brother.  
Speaker 2    00:48:21    Uh, Sam, thanks for having me. This is awesome.  
Speaker 0    00:48:24    Thank you for listening to the sales samurai podcast with your host, Sam Capra. Be sure you subscribe to our podcast and visit sales samurai.io and join the conversation. Access show notes and discover bonus content. 

Nick Mishkin

Public Speaker

Public speaker, podcast critic, music promoter, and behavioral economics consultant. Nick specializes in applying behavioral science to business communication. Since earning his bachelor’s degree in Economics & Music from the University of Pennsylvania, Nick has sold products for several companies across many industries: music, advertising, SaaS technology, and information technology. He is earning his masters degree in behavioral economics at IDC Herzliya in Israel and curates the popular Spotify podcast playlist “Behavioral Economics.”