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Have you ever seen a basketball team abruptly go ice-cold during a game? Out of nowhere, they’ve missed 13 straight shots and are down by 20 points. As the team heads down the floor for their next possession, you think to yourself, “This time they have to score. They’re due.”
In reality, the team isn’t more likely to make the next basket if they’ve missed the last 13. You’ve just succumbed to gambler’s fallacy: Thinking things in life will average out.
Our minds are naturally prone to these kinds of biases. And depending on the field you’re in, certain inclinations can play a huge role in your overall success. In sales, biases can be a rep’s worst nightmare. They can lead a rep to jump to inaccurate conclusions about a prospect or themselves, resulting in a lost deal.
Recognizing that we all have unique biases is the key to overcoming their potential negative effects. Below are 12 psychological biases we’re all susceptible to and how they affect salespeople.
12 Psychological Biases Affecting How You Sell
1) Anchoring Bias
Anchoring bias is our tendency to overemphasize the first piece of information we learn by using it as our criteria to make a decision.
If a salesperson latches on to the first pain point a prospect mentions and believes it’s a higher priority than anything they learn afterwards, they’ve fallen victim to anchoring bias. The first pain point a prospect raises might not be the most important. While reps should always solve for the customer, solving a low-priority problem isn’t enough to close a deal.
Reps should spend time learning as much as they can about prospects through research and thorough discovery. Salespeople can’t provide prospects with valuable advice unless they have an accurate understanding of their prospect’s goals and pain points.
2) Hyperbolic Discounting
In a scenario where people are given the choice between two similar rewards, we tend to value the one that arrives sooner. For example, if you were offered $20 now or $30 in two months, you would likely prefer the $20 now.
Salespeople often take advantage of this bias through hyperbolic discounting -- slashing the price to influence a decision and reach their quota faster instead of planning for the long-term and working on the prospect’s timeline.
Although it’s tempting to offer a discount just to get a deal signed earlier, reps should prioritize the long-term benefits of the relationship. Customers who are loyal for years are much more valuable than a prospect who churns after a few months.
3) Confirmation Bias
Confirmation bias is interpreting information in a way that confirms what you already believe.
Sales reps can fall victim to this bias if they ask prospects loaded questions because they’re in search of a specific answer. For example, if a rep thinks a prospect could benefit from new onboarding software, they might ask, “Would you like to get your new employees producing better results, faster?” Of course the answer is yes, but that doesn’t confirm the prospect needs new onboarding software.
While it’s helpful to have research-backed assumptions prior to talking to a prospect, reps need to remember to be open to new information and be ready to admit their educated guess might be incorrect.
4) Clustering Illusion
When you notice a pattern in a completely random series of events, you’ve fallen for the clustering illusion.
This happens in sales when a rep has success with a few prospects using a specific selling strategy, so they use that technique in every sale going forward. This bias is likely how the sales script came to life: If it worked with one prospect, the thinking goes, it will work with all of them.
While a pattern of success with a few prospects is great, it shouldn’t drastically influence how you approach every prospect going forward. Having a one-size-fits-all mentality will result in more lost prospects than won deals. Keeping each outreach personal and specific allows reps to connect with prospects in a genuine way, and provide significant value.
5) Planning Fallacy
The planning fallacy occurs when you drastically underestimate how much time you need to complete a task.
When a call goes well after a salesperson does limited work prior to picking up the phone, they can fall into the trap of thinking this is all the time they need to be successful. The planning fallacy seduces reps into doing the minimum amount of work while still expecting good results.
Providing yourself ample time for tasks is key to success. Instead of doing the minimum and believing you’ll see maximum results, you should set aside a significant amount of time for every task to ensure you’re doing the best job possible.
6) Curse of Knowledge
The curse of knowledge is when you’re unable to relate to an uninformed person’s problems, because you have better information.
Sales reps who know their product can benefit a prospect might fall prey to this bias by dismissing a prospect’s objections because of their expertise. Instead of listening to objections and taking time to explain points of confusion, this bias causes reps to revert to, “But it works! Trust me!”
Instead of insisting that the product addresses their prospect’s concern, salespeople need to act as trusted advisors. Reps can handle objections through sound reasoning, customer reviews, and testimonials, but the key is education. If your prospects are still asking questions disguised as objections, they don’t understand your product’s value well enough.. The prospect isn’t interested in whether the product works, they want to know how it will work for them.
7) Galatea Effect
The Galatea effect states if you believe you’re going to be a top performer, you’ll actually become one because of that mindset.
The Galatea effect rears its head when a rep believes they were solely responsible for winning -- or losing -- a deal. After a deal goes bad, a rep can start to question their skills, which can lead to worse performance. On the other hand, if a call goes well, a confidence boost can be the foundation for a hot streak.
To overcome this bias, reps should examine every factor in each call and listen to coaching from their manager to remain objective. While the rep does play a major role in the decision, many other factors influence a prospect’s choice to buy or not.
8) Choice Bias
The choice bias leads us to retroactively view our past choices in a positive light while overemphasizing negative attributes of options we didn’t select.
In sales, choice bias impacts your response to making a mistake. If a prospect turns out to be a bad fit, the bias influences the speed at which you come to terms with the mistake. It also protects you from being too hard on yourself, because you’re likely to remember the positives and look past the negatives.
In order to be successful, make sure to pay attention to all relevant emerging information. Instead of assuming every decision you make is great, recognize when things haven’t gone the way you expected. Learning from your mistakes is a powerful tool.
9) Recency Bias
Recency bias is the tendency to believe patterns that have recently emerged are likely to continue in the future even if they contradict long-term data.
If a rep notices commonalities in their last five deals and abandons time-tested strategies, they’ve fallen for the recency bias. New data is exciting, but it could be an outlier. A larger sample size -- the rep’s history over several months -- is likely to be more accurate.
If the commonalities continue over time, however, reps should use these new insights in sales conversations going forward. Gut decisions have no place in modern sales; the data should speak for itself.
10) Gambler’s Fallacy
The gambler’s fallacy is the belief that an event is less likely in the future because it’s happening often in the present, even if the outcome of one event has no statistical impact on future ones.
After a rep has four or five bad calls, they might think their next one will go better because things will average out. But they’ve failed to realize that their previous calls have no impact on their upcoming one.
This bias is dangerous because it can cause salespeople to expect their luck to change without any behavioral changes on their part. Reps can avoid this by digging deeper to understand why calls went poorly, and adjusting their strategy accordingly. Instead of trying the same thing over and over, changing tactics can put an end to the bad streak.
11) Hot Hand Fallacy
The inverse of the gambler’s fallacy is the hot hand fallacy -- the mistaken belief that if you succeed (or fail) at a random event in the present, you’re likely to have more success (or failure) in the future because of it.
When a rep closes several deals in a row and concludes that every call he makes going forward will be easy, he’s succumbed to the hot hand fallacy. These deals are closing because of hard work put in over the last few weeks, not because the rep is “heating up.”
Ultimately, it’s sales fundamentals that affect a rep’s success. Prospects convert because of hard work, research, and a great relationship, not because the rep is on a hot streak.
12) Empathy Gap
The empathy gap is a phenomenon where we have difficulty putting ourselves in other people’s shoes if we aren’t currently in the same physical or emotional state -- for example, if we are angry, we have a hard time understanding how others could be happy.
When reps and prospects are in completely different states of mind, reps need to be hyper-conscious of putting themselves in their prospect’s shoes instead of dismissing or minimizing their feelings. The empathy gap makes it more difficult for them to reach common ground, and can create disdain between the rep and prospect, souring the relationship before it even begins.
Ultimately, we don’t know which biases we have and how they’re affecting our behavior at any given moment. But we can learn to identify bias and adjust our behavior accordingly. Sales can be a highly emotional job -- staying level-headed is part of being successful.
from HubSpot Marketing Blog http://blog.hubspot.com/marketing/psychological-biases-selling
Via http://blog.hubspot.com/marketing/psychological-biases-selling
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