1 00:00:06,250 --> 00:00:09,377 Hi, I'm Noah Goldstein, a faculty member at the UCLA Anderson School of 2 00:00:09,377 --> 00:00:12,400 Management. And today, I'll be talking with you about 3 00:00:12,400 --> 00:00:16,599 persuasion, specifically one principle of persuasion, so let's get started. 4 00:00:17,680 --> 00:00:21,376 So, Tony Little is a fitness guru who has sold dozens of exercise contraptions, 5 00:00:21,376 --> 00:00:25,408 doohickeys, and gizmos that you may have seen on late night infomercials and other 6 00:00:25,408 --> 00:00:29,884 television commericals. Now, Tony Little has been widely 7 00:00:29,884 --> 00:00:33,212 successful selling all of these different contraptions using the standard 8 00:00:33,212 --> 00:00:36,970 infomercial lines that we're all quite familiar with. 9 00:00:36,970 --> 00:00:41,662 But after hiring a infomercial consultant named [UNKNOWN] sales of his latest 10 00:00:41,662 --> 00:00:46,335 contraption skyrocketed. Now, what's particularly remarkable about 11 00:00:46,335 --> 00:00:49,965 this huge increase in sales is that it's been largely attributed to a seemingly 12 00:00:49,965 --> 00:00:53,595 small change that Colleen Szot made to an infomercial line that we're all quite 13 00:00:53,595 --> 00:00:58,762 familiar with. And that line is, operators are standing 14 00:00:58,762 --> 00:01:03,0 by, please call now and we've all heard this line a million times. 15 00:01:03,0 --> 00:01:07,26 But Colleen Szot realized that there was a potentially missed opportunity for 16 00:01:07,26 --> 00:01:10,902 persuasion. So she changed the line from operators 17 00:01:10,902 --> 00:01:17,910 are standing by, please call now to, if operators are busy, please call again. 18 00:01:17,910 --> 00:01:21,938 If operators are busy, please call again. Now, if you think about it from a 19 00:01:21,938 --> 00:01:25,388 business standpoint, this seems suicidal, after all, it's hard enough to get this 20 00:01:25,388 --> 00:01:28,924 guy, interested in exercising in the first place. 21 00:01:28,924 --> 00:01:32,60 But, now you're seemingly conveying to him, by saying if operators are busy, 22 00:01:32,60 --> 00:01:35,245 please call again, that if he bothers to take his finger out of his mouth, and he 23 00:01:35,245 --> 00:01:38,381 used it to dial the number he sees on the screen, he's going to encounter a busy 24 00:01:38,381 --> 00:01:43,450 signal. But there's a certain genius to this 25 00:01:43,450 --> 00:01:46,968 change that Calisat made. Think about the type of mental imagery 26 00:01:46,968 --> 00:01:50,80 that comes to mind with these two different lines. 27 00:01:50,80 --> 00:01:54,520 Operators are standing by. What are you imagining in your mind? 28 00:01:54,520 --> 00:01:58,808 You imagine a couple of bored looking sales representatives maybe twitting 29 00:01:58,808 --> 00:02:02,74 their thumbs. Or maybe dozing off, or doing their 30 00:02:02,74 --> 00:02:06,670 crossword puzzle, which is clearly indicative of low sales and poor demand. 31 00:02:06,670 --> 00:02:09,960 On the other hand, if operators are busy, please call again. 32 00:02:09,960 --> 00:02:12,990 That's a very different mental image that comes to mind. 33 00:02:12,990 --> 00:02:17,400 You can imagine scores of people answering the phones you know? 34 00:02:17,400 --> 00:02:20,150 Which is clearly indicative of popularity, right? 35 00:02:20,150 --> 00:02:43,411 High sales and and large demand. Today's mini lecture will be on a that 36 00:02:43,411 --> 00:02:47,305 people look to others to guide their own behavior, especially when they're 37 00:02:47,305 --> 00:02:52,225 uncertain how to behave. Now before we really get into the studies 38 00:02:52,225 --> 00:02:56,237 that I'll be talking about, I just wanted to briefly introduce the domain in which 39 00:02:56,237 --> 00:03:00,880 we conducted our studies and that's hotel towels. 40 00:03:00,880 --> 00:03:04,520 So if you've stayed at a hotel recently, you've seen that there are these signs 41 00:03:04,520 --> 00:03:09,467 that ask you to reuse your towels in order to help save the environment. 42 00:03:09,467 --> 00:03:13,559 And why do you think that these things have become so popular in hotels? 43 00:03:13,559 --> 00:03:17,321 Now fortunately, it's that hotels are really caring about the environment and 44 00:03:17,321 --> 00:03:21,136 they really want to help. Okay, now this is a cynacism check 45 00:03:21,136 --> 00:03:25,74 because at home you're probably thinking, we'll wait a minute. 46 00:03:25,74 --> 00:03:28,714 I'm sure the hotels want to help save the environment, but there has to be another 47 00:03:28,714 --> 00:03:31,845 reason why. It turns out that the hotels can save a 48 00:03:31,845 --> 00:03:35,827 lot of money if people decide to reuse their towels and bed linens. 49 00:03:35,827 --> 00:03:39,832 Okay, so it helps the environment but of course it also helps the hotel. 50 00:03:39,832 --> 00:03:43,726 Now, my colleagues and I were quite curious about whether or not these signs 51 00:03:43,726 --> 00:03:48,361 are actually effective at getting people to reuse their towels. 52 00:03:48,361 --> 00:03:52,196 And so we looked around and we found a study that suggested that these signs 53 00:03:52,196 --> 00:03:56,812 work surprisingly well. So one little study we saw suggested that 54 00:03:56,812 --> 00:04:00,592 over three quarters of people, who are given the opportunity to reuse their 55 00:04:00,592 --> 00:04:04,914 towel, do so at least sometime during their stay. 56 00:04:04,914 --> 00:04:08,808 It doesn't mean that 75% of people do it all the time, but at least participating 57 00:04:08,808 --> 00:04:12,406 in the program in some way, shape, or form. 58 00:04:12,406 --> 00:04:16,306 So what we wanted to see was what if we communicated this social proof 59 00:04:16,306 --> 00:04:22,190 information to, other hotel guests? Would we see an additional boost in towel 60 00:04:22,190 --> 00:04:25,274 reuse? So we were fortunate enough to solicit 61 00:04:25,274 --> 00:04:29,432 the cooperation of a local Holiday Inn manager, who allowed us to go into the 62 00:04:29,432 --> 00:04:33,266 hotel. And replace their signs with our signs 63 00:04:33,266 --> 00:04:37,486 and I'd like to tell you about three of those different signs. 64 00:04:37,486 --> 00:04:41,206 The first one was a standard environmental message, that one just told 65 00:04:41,206 --> 00:04:46,272 guests that what they were doing was going to help save the environment. 66 00:04:46,272 --> 00:04:50,559 So the environment deserves our respect. You can show your respect for nature and 67 00:04:50,559 --> 00:04:54,617 help save the environment by reusing your towels during your stay. 68 00:04:54,617 --> 00:04:58,235 This is a very typical message what you typically see at hotels all around the 69 00:04:58,235 --> 00:05:01,200 world. The next one is based on this principal 70 00:05:01,200 --> 00:05:04,494 of social proof and it says, join your fellow guests in helping to save the 71 00:05:04,494 --> 00:05:08,154 environment. In a study conducted in Fall 2003, that 72 00:05:08,154 --> 00:05:12,3 was several years prior to when we actually conducted our study. 73 00:05:12,3 --> 00:05:15,766 75% of the guests participated in our new resource savings program by using their 74 00:05:15,766 --> 00:05:19,412 towels more than once. You can join your fellow guests in this 75 00:05:19,412 --> 00:05:24,22 program to help save the environment by reusing your towels during your stay. 76 00:05:24,22 --> 00:05:27,841 So, as you can see, this is the principle social proof, the idea that lots of other 77 00:05:27,841 --> 00:05:32,700 people are reusing their towels. And so we think that that may influence a 78 00:05:32,700 --> 00:05:36,581 guest's behavior, so let's actually take a look at the data. 79 00:05:36,581 --> 00:05:40,475 And what you're seeing here is a graph of the change in towel reuse rate compared 80 00:05:40,475 --> 00:05:44,605 to the standard environmental appeal rate and what we found is simply by indicating 81 00:05:44,605 --> 00:05:50,181 that these majority of other people were reusing their towels. 82 00:05:50,181 --> 00:05:53,158 We saw a 20% increase in towel reuse, right? 83 00:05:53,158 --> 00:05:56,940 Now, if you think about it, this principle of social proof seems obvious, 84 00:05:56,940 --> 00:06:00,204 right? Everyone follows the herd, it seems like 85 00:06:00,204 --> 00:06:04,44 we all kind of know this intuitively and yet, if it's so obvious, why isn't the 86 00:06:04,44 --> 00:06:08,292 hotel doing it? Why have we never seen a single hotel 87 00:06:08,292 --> 00:06:12,395 ever actually communicating this information to the guest? 88 00:06:12,395 --> 00:06:15,929 So that's you know, one of the meta points of today is that, despite the fact 89 00:06:15,929 --> 00:06:20,309 that principles of persuasion seem obvious in hindsight. 90 00:06:20,309 --> 00:06:24,242 when people are actually trying to persuade, they often fail to utilize 91 00:06:24,242 --> 00:06:29,639 these seemingly simplistic principles. So, whenever the desirable behavior is 92 00:06:29,639 --> 00:06:33,592 the norm, when other people are doing the right thing that they're taking the 93 00:06:33,592 --> 00:06:37,663 action that you want people to take, it's really important to remember the power of 94 00:06:37,663 --> 00:06:43,243 the principle of social proof. Now the thing is, even though 95 00:06:43,243 --> 00:06:47,659 organizations and individuals often fail to use this principle. 96 00:06:47,659 --> 00:06:51,213 I'm not saying that nobody uses it. Marketers tend to be pretty good at it 97 00:06:51,213 --> 00:06:54,184 and we're certainly seen some examples of that. 98 00:06:54,184 --> 00:06:57,748 So, we might hear that the for F-series truck is the best selling truck in 99 00:06:57,748 --> 00:07:00,800 America, right? I mean, what they're doing is 100 00:07:00,800 --> 00:07:04,634 communicating the principle social proof, so that when somebody is uncertain about 101 00:07:04,634 --> 00:07:09,264 which type of car they're going to buy. If they look to the marketing slogan then 102 00:07:09,264 --> 00:07:12,248 they recognize, okay? Well, if that's the best selling car in 103 00:07:12,248 --> 00:07:16,5 America, most people are choosing that, so I should choose that too. 104 00:07:16,5 --> 00:07:19,662 So there are of course cases that we see where marketers get it right. 105 00:07:19,662 --> 00:07:23,622 But I'm going to make the argument that even in marketing people who know these 106 00:07:23,622 --> 00:07:29,32 principles very well, I still think that there is room for improvement. 107 00:07:29,32 --> 00:07:33,609 So, for example, if you look at any time a company introduces a new product. 108 00:07:33,609 --> 00:07:38,743 So for example let's say it's a, Arby's New Angus Three Cheese & Bacon burger. 109 00:07:38,743 --> 00:07:42,258 Now what do they tend to do when they're advertising this product? 110 00:07:42,258 --> 00:07:45,534 Well one thing that they do, and the major thing that they do is talk about 111 00:07:45,534 --> 00:07:49,380 why it's so good. What are the benefits to the customer? 112 00:07:49,380 --> 00:07:51,693 What is the customer going to like about that? 113 00:07:51,693 --> 00:07:55,333 And that's very intuitive, it makes total sense why they would do that, but I'm 114 00:07:55,333 --> 00:07:59,950 going to argue that there is a missed opportunity for persuasion. 115 00:07:59,950 --> 00:08:04,559 Now if you think about it, how did these products actually come to market? 116 00:08:04,559 --> 00:08:09,359 Does the CEO just say, slap together some mayo, some brisket, and no that's not how 117 00:08:09,359 --> 00:08:14,997 decisions are made big decisions are made at these big companies. 118 00:08:14,997 --> 00:08:18,124 There's a lot of internal market research, or there's a lot of internal 119 00:08:18,124 --> 00:08:21,675 testing to see whether or not an idea, a particular sandwich, let's say the three 120 00:08:21,675 --> 00:08:27,283 cheese bacon burger is actually something that customers are going to like. 121 00:08:27,283 --> 00:08:30,867 So, in order to decide whether we should bring that product to the market, or a 122 00:08:30,867 --> 00:08:36,2 totally different product to the market. They have to actually test which one is 123 00:08:36,2 --> 00:08:40,757 better, which one consumers like, maybe compare it to competitors burgers. 124 00:08:40,757 --> 00:08:44,411 And, now what's interesting about these internal test market data, is that 125 00:08:44,411 --> 00:08:48,181 companies use them in order to make the decision of which products to actually 126 00:08:48,181 --> 00:08:52,743 bring to the market. But, I would argue that there's a missed 127 00:08:52,743 --> 00:08:57,124 opportunity for influence there based on the principal social proof. 128 00:08:57,124 --> 00:09:00,712 in fact, not only are these data often internal test market data, but sometimes 129 00:09:00,712 --> 00:09:04,144 before introducing the campaign nationally, they'll go out and they'll go 130 00:09:04,144 --> 00:09:09,995 to town in North Carolina, and introduce the burger there and see how it does. 131 00:09:09,995 --> 00:09:12,860 See how people like it, in comparison to other things. 132 00:09:12,860 --> 00:09:16,490 now the point is, here's this heard information that you have, you know that 133 00:09:16,490 --> 00:09:19,955 people prefer this burger to maybe a Wendy's version of that burger and yet, 134 00:09:19,955 --> 00:09:23,420 that information is used to make the decision of which product to take to the 135 00:09:23,420 --> 00:09:26,720 market, and is rarely actually communicated to the consumer and I would 136 00:09:26,720 --> 00:09:33,911 call that a failed opportunity or a missed opportunity for persuasion. 137 00:09:33,911 --> 00:09:37,730 Now, there are a couple of times in, in marketing history when companies have 138 00:09:37,730 --> 00:09:41,549 gotten it right, if you think about the Pepsi challenge for example, if Pepsi had 139 00:09:41,549 --> 00:09:45,254 realized that if you drink a little sip of Pepsi or Coke in a blind taste test 140 00:09:45,254 --> 00:09:51,247 more people, right, the herd, actually prefers Pepsi. 141 00:09:51,247 --> 00:09:55,87 So Pepsi went out and said, take the Pepsi challenge, here's what our data 142 00:09:55,87 --> 00:09:58,151 show. But rarely have we actually seen this 143 00:09:58,151 --> 00:10:02,104 implemented in marketing campaigns despite the seeming obviousness of the 144 00:10:02,104 --> 00:10:05,723 principle. Now there are a couple of exceptions to 145 00:10:05,723 --> 00:10:09,151 this one just to keep in the fast food domain. 146 00:10:09,151 --> 00:10:12,728 Wendy's came out with new fries. Now again, they didn't just say, alright 147 00:10:12,728 --> 00:10:15,223 well lets. The CEO didn't say here's how we're 148 00:10:15,223 --> 00:10:18,562 going to make the fries, there were ideas, there was internal market research 149 00:10:18,562 --> 00:10:22,890 and ultimately they. figured out that people preferred these 150 00:10:22,890 --> 00:10:25,902 fries to McDonalds fries in a blind taste test. 151 00:10:25,902 --> 00:10:29,486 And so, what Wendy's did was, they actually did the right thing something 152 00:10:29,486 --> 00:10:32,697 very different than what we typically see. 153 00:10:32,697 --> 00:10:35,577 They came out with a campaign saying that, you know? 154 00:10:35,577 --> 00:10:39,877 Roughly 56 percent of people preferred their fries to McDonalds, right? 155 00:10:39,877 --> 00:10:43,288 That's what the herd is doing. Now, I'm not arguing that this type of 156 00:10:43,288 --> 00:10:46,704 campaign would make people who are McDonalds devotees that it would make 157 00:10:46,704 --> 00:10:52,82 them run into a Wendy's to try the fries. And remember what I said earlier, social 158 00:10:52,82 --> 00:10:55,778 proof, like almost all the principles of influence, are going to be most powerful 159 00:10:55,778 --> 00:10:59,472 when people are uncertain of how to behave. 160 00:10:59,472 --> 00:11:02,970 So what that means is again, if you love McDonald's fries and you've never eaten 161 00:11:02,970 --> 00:11:06,44 anywhere else, you're not going to be influenced by this social proof 162 00:11:06,44 --> 00:11:09,986 information. However, if you are person who is unsure, 163 00:11:09,986 --> 00:11:13,314 you're curious, that information is probably going to push you over the edge 164 00:11:13,314 --> 00:11:17,252 and you are going to be more likely to try the fries. 165 00:11:17,252 --> 00:11:20,437 And Wendy's believes that once you try the fries, you're actually going to 166 00:11:20,437 --> 00:11:24,631 prefer those fries in the future. So as I was saying earlier, people follow 167 00:11:24,631 --> 00:11:27,108 the herd. We've seen some evidence for this and of 168 00:11:27,108 --> 00:11:31,176 course, this is not the only study done on the principle of social proof. 169 00:11:31,176 --> 00:11:34,508 There's lots of other research that validates this principle, but there's an 170 00:11:34,508 --> 00:11:38,970 important question that we have to ask. Which is yeah, sure people follow the 171 00:11:38,970 --> 00:11:43,910 herd but we have to remember, they're are a lot of different herds out there. 172 00:11:43,910 --> 00:11:47,139 So which herd are we going to be most likely to follow. 173 00:11:47,139 --> 00:11:50,735 So, earlier I was talking about the social proof message that we used in the 174 00:11:50,735 --> 00:11:57,362 hotel. Which indicated that 75% of people who 175 00:11:57,362 --> 00:12:08,282 were similar to the hotel guests, right, 75% of people who had stayed in a hotel 176 00:12:08,282 --> 00:12:19,760 just like our, our guests reuse their towels. 177 00:12:19,760 --> 00:12:24,182 We said the following, 75% of the guests who stayed in your room #321, or whatever 178 00:12:24,182 --> 00:12:28,736 the room number was, participated in the new resource savings program and the rest 179 00:12:28,736 --> 00:12:35,478 of the message was exactly the same. So, remember, all of the herd information 180 00:12:35,478 --> 00:12:39,438 is the same, in the terms of the number 75%, but in, in that prior case it's 181 00:12:39,438 --> 00:12:43,596 other people like you at the hotel, and in this case it's people who stayed in 182 00:12:43,596 --> 00:12:49,367 your room. Now, let's take a look at the data. 183 00:12:49,367 --> 00:12:53,583 So, earlier we found a 20% increase in the likelihood of reusing our towels 184 00:12:53,583 --> 00:12:57,799 simply by informing people that the majority of others were reusing their 185 00:12:57,799 --> 00:13:04,187 towel, like others in the hotel. But now what happens when we tell people, 186 00:13:04,187 --> 00:13:09,801 that other people who stayed in your particular room reuse their towels? 187 00:13:09,801 --> 00:13:14,335 Now we get a 33% increase in towel reuse, so what's going on here? 188 00:13:14,335 --> 00:13:18,202 Want you to ask yourself, is this rational behavior? 189 00:13:18,202 --> 00:13:22,289 If you think about it, there is no rational reason why the norms operating 190 00:13:22,289 --> 00:13:26,510 in your particular room are going to be any more adaptive or any more effective 191 00:13:26,510 --> 00:13:33,1 than the norms in the rooms next door. And in fact, if you really think about it 192 00:13:33,1 --> 00:13:36,713 deeply there is no group of people who has done more to ickefy, your room, than 193 00:13:36,713 --> 00:13:40,960 the very people who've stayed in it previously. 194 00:13:40,960 --> 00:13:44,480 Alright, you don't even want to think what those people have done in your room 195 00:13:44,480 --> 00:13:47,721 previously. So again, there's no a neccessarily, 196 00:13:47,721 --> 00:13:51,529 there shouldn't be, from a logical point of view, even warm and fuzzy feelings 197 00:13:51,529 --> 00:13:55,582 between yourself and those people in the past. 198 00:13:55,582 --> 00:13:59,173 Well, as we see in persuasion research as well as a lot of the research Jan has 199 00:13:59,173 --> 00:14:03,144 talked about, people don't always behave rationally. 200 00:14:03,144 --> 00:14:06,566 And in persuasion they don't always behave rationally in response to 201 00:14:06,566 --> 00:14:10,102 persuasive messages. Now, what we think is going on is that 202 00:14:10,102 --> 00:14:13,798 normally it is adaptive to follow the norms of people who are similar to you, 203 00:14:13,798 --> 00:14:19,628 the norms of your particular environment. It normally makes sense that if you're in 204 00:14:19,628 --> 00:14:24,393 a multinational company, which norm should you follow for how to behave. 205 00:14:24,393 --> 00:14:27,687 Well, the norms of your particular department, the people on your floor, 206 00:14:27,687 --> 00:14:32,620 normally following those norms is more diagnostic of what's the right behavior. 207 00:14:32,620 --> 00:14:35,806 And we think that people over learn this over time, right, that they are 208 00:14:35,806 --> 00:14:39,424 constantly being rewarded for following the norms of similar others in similar 209 00:14:39,424 --> 00:14:43,48 situations. And that when they're not thinking 210 00:14:43,48 --> 00:14:46,590 particularly deeply. They're going to be more likely to follow 211 00:14:46,590 --> 00:14:50,939 a norm like this which we call a provincial norm, right? 212 00:14:50,939 --> 00:14:55,629 Their particular province, their particular area or locale or context then 213 00:14:55,629 --> 00:15:01,0 you would expect rationally. So, one really common persuasion mistake 214 00:15:01,0 --> 00:15:04,904 that I tend to see is that people, even when they remember the principle of 215 00:15:04,904 --> 00:15:09,637 social proof, they fail to point to the right herd. 216 00:15:09,637 --> 00:15:13,667 And what I'm arguing here is that the right herd is the one that is similar to 217 00:15:13,667 --> 00:15:18,157 the audience, that shares the context of the audience. 218 00:15:18,157 --> 00:15:22,807 So, for example if there's an ad campaign in California or in Santa Monica to try 219 00:15:22,807 --> 00:15:26,651 to get Santa Monicans to recycle, and that's where I live, if I saw an ad that 220 00:15:26,651 --> 00:15:32,912 said 95% of Californians recycle. I think that would be a good use of the 221 00:15:32,912 --> 00:15:36,572 principal social proof, that if especially if I'm uncertain, I would be 222 00:15:36,572 --> 00:15:42,87 more likely to do it, but I don't think that is the optimal message. 223 00:15:42,87 --> 00:15:45,747 Assuming of course that the norms were the same and 95% of people in Santa 224 00:15:45,747 --> 00:15:49,346 Monica recycled, I would be much more persuaded by an ad that said 95% of 225 00:15:49,346 --> 00:15:55,260 people in Santa Monica recycle. And so you always have to remember, you 226 00:15:55,260 --> 00:15:58,800 know, when I'm going to convey this herd information, this social proof 227 00:15:58,800 --> 00:16:03,107 information what is the right herd and, and hopefully based on this discussion I 228 00:16:03,107 --> 00:16:09,200 pointed you in the right direction. I'm glad I had the chance to talk to you 229 00:16:09,200 --> 00:16:13,166 for at least a little bit about the science of persuasion. 230 00:16:13,166 --> 00:16:17,1 If you're interested in learning more, you can always go out and buy a book that 231 00:16:17,1 --> 00:16:22,232 I have co-authored with Robert Cialdini and Steve Martin entitled, yes. 232 00:16:22,232 --> 00:16:25,886 And one final fact that I'll end on is that 95% of people who have watched this 233 00:16:25,886 --> 00:16:29,614 video have gone out and bought it immediately. 234 00:16:29,614 --> 00:16:30,849 Thank you very much.