Nudge theory is a behavioral economy tool developed in 2008. Yet it has practical application in sales too.
"Nudge theory is founded on the idea that subtle, indirect suggestions, decision triggers, and emotional anchors can be employed to delicately shape the behavior of your audience," says Simon Marley, a 30-year veteran of sales.
For decades, he's been actively integrating principles of nudge theory into his own sales strategies.
Simon says its roots lie in the science of human decision-making.
"By gaining a deep understanding of how humans arrive at their decisions, you can progressively mold their cognitive processes," he says.
Woah. That sounds manipulative. This aspect is debatable and often misunderstood.
Is this manipulative?
"A nudge is a simple aspect of people’s decision-making environment altering behavior in a predictable way, without forbidding any options or significantly changing their incentives," says Dr. Itamar Shatz, a Cambridge PhD. and avid researcher.
He gives this example: If a school wants to reduce the amount of soda students drink, replacing soda cans with water bottles near the cafeteria register is a nudge. But banning soda outright does not. (that's coercion)
Ultimately, Richard Thayer (who coined nudge) was all about giving people self-control in their life -- particularly their finances. However, nudge was invented as a means to get people to pay taxes!
Dr. Shatz says nudges are low-cost, behaviorally-informed, choice-preserving solutions to various personal and societal issues.
"This means that nudges are generally easy to implement, are relatively effective, and allow people to make their own choices," he says.
Does nudge apply to sales?
Absolutely. Because nudges are generally based on a simple idea: People are imperfect decision-makers, who frequently behave irrationally. This is how people buy. Irrationally and, often, emotionally.
But beware: This has lead to misunderstanding, misinterpreting nudge in practice.
Case in point, "The marketing funnel is a simplistic way to map the buyer’s journey," says Vince Moreau who says content marketing operates from a bad assumption.
That is: "People gradually go through a brand’s content, with the final destination being the bottom of the funnel conversion. This concept does not work, for multiple reasons," he says.
The need to feel in control has bit many marketers in the butt. Because they believe putting people in a "funnel" lets them “move them down” by “providing value” or “nurturing them.”
"Truth is: this is not how the real-world works," says Vince.
How can it be applied?
Simon Marley says nudge in sales involves guiding customers along a particular mental pathway without attempting to create massive change in their worldview.
"Instead, you introduce a nudge aligning with their pre-existing beliefs, values, and thoughts."
Wonderful. Dr. Shatz agrees.
Because people are imperfect, irrational decision-makers, nudge is a way to influence decisions customers make by changing their choice architecture.
In other words, cater to the context in which they make decisions if you want to influence how they make decisions.
Note: Not their decisions. Rather, how they make them.
Rather than eliminating choices, changing how they see them.
Nudging CEOs and CFOs
Simon Marley says CFOs and CEOs possess unwavering beliefs and values. That's why you won't sway them -- unless your proposal aligns with principles used to guide decisions.
"It's akin to trying to convert a devout Catholic to Buddhism—an exceedingly improbable undertaking," says Marley.
However, he says, introducing a subtle adjustment "that resonates with their current convictions and values" can make your offer irresistible.
The key lies in identifying the precise element(s).
In his practice, Marley presents Officer level contacts with spreadsheets -- showcasing ways to increase sales. He says they usually, "find it difficult to disregard the document. In fact, it will hold an irresistible allure for them."
Marley says, "You're subtly nudging them to explore a potential benefit, but you're doing so in a way that they'll find nearly impossible to resist. By complementing your initial nudge with subsequent nudges, you can increase the significance of your engagement."
The more relevant nudges you employ, Marley says, the closer alignment you can achieve with your proposition.
"When you nudge someone in this fashion, their thought processes are directed along a path of curiosity, leading them to ask more insightful questions."
However, nudges can also take advantage of biases customers display. For example, someone inside the customer organization who resists change can nudge a decision-team member to maintain the status quo -- leveraging status quo bias, where people tend to prefer to keep things as they are.
Can this backfire?
Nudges can have virtuous effects. Like encouraging organ donation, reducing consumption of energy, and saving money. However, not everything about nudge theory is rosy.
"In their enthusiasm, marketers have overlooked fundamental concerns about using nudges," says Utpal Dholakia.
"Nudges that are poorly thought out could be ticking time bombs waiting to explode and damage the company’s reputation and credibility among loyal customers," says Dholakia.
Nudges can be condescending.
"Anytime a nudge is designed to promote a behavior, in effect the marketer is saying to the consumer, 'You are too weak-minded and you don’t have enough self-control. You need help. Unless I nudge you, you will not do the right thing,'" says Dholakia.
This is why Spark Selling practices involve removing calls-to-action -- and all attempts to "adding value" -- from sales outreach messages. This reduces persuasive tone, which is key in earning engagement.
No persuasion, attract
The core issue is persuasion. People hate it. The sense it immediately and run the other way. Thus, never try to persuade anyone of anything.
Dholakia says motivational psychology relies on arming customers with willpower and the knowledge needed to make virtuous choices on their own.
No persuasion. No nudges.
Instead, helping customers persuade themselves is the way forward. This is at the core of Spark Selling and what we practice in the Academy.
Psychologist, Jeremy Dean, PhD. has described an element of this communication strategy as the "The ‘But You Are Free’ technique."
This tactic is reaffirms people’s freedom to choose. When you ask someone to do something, you add on the sentiment -- they are free to choose.
"By reaffirming their freedom you are indirectly saying to them: I am not threatening your right to say no. You have a free choice," says Dr. Dean.
Want to open more conversations with customers? Acknowledge their right to choose within the message.
"The exact words used are not especially important. The studies have shown that using the phrase 'But obviously do not feel obliged,' worked just as well as 'but you are free.'"
Where's the proof? Where's the data?
Jeremy reviewed 42 psychology studies carried out on this technique. Result: It is surprisingly effective given how simple it is. Over 22,000 people have been tested by researchers.
Across all the studies it was found to DOUBLE the chances that someone would say ‘yes’ to the request.
What does this have to do with effective sales outreach? Everything.
Let's discuss the possibility of you giving up persuasion -- replacing it with helping customers persuade themselves. See you in comments below!