Yapping about “influence” could increase tips and spend by 3-50%
In a post-COVID19 world of reduced footfall and suppressed consumer spending, it’s crucial we maximise every opportunity to delight customers (and increase average transaction values). In this video, produced with leading UK Hospitality publication PropelInfo, award-winning behavioural scientist Steve Martin shares his top tips from the field of behavioural science to share with your teams.
“We believe in Steve's message and his teachings so much that… we're offering the first 15 customers who sign up to Yapster on commercial terms on the other side of COVID-19 a complimentary consulting package with Steve, on us.” said Rob Liddiard, co-founder CEO of Yapster.
Webinar transcript
Tue, 5/19 7:48PM • 28:16
SPEAKERS:
Rob Liddiard, Co-founder CEO of Yapster
Steve Martin, visiting professor at Columbia Business School
[Note: this transcript was created automatically, using a digital transcription tool. It has been lightly edited for clarity, but may contain minor typos or inaccuracies.]
Rob Liddiard 00:01
Hi, everyone, I'm Rob Liddiard. I'm one of the co founders and the CEO Yapster. So for those that don't know, Yapster is a mobile communication platform that we put in the hands of every frontline member of staff so that they can talk to one another quickly and securely, but also to connect those frontline teams to head office teams or company leadership, and increasingly to a wide range of underlying systems that we connect to through intelligent integrations. I'm not going to say any more about Yapster right now, but if you want to hear about us then please do visit our website at Yapster.info.
Rob Liddiard 00:30
We're ever so grateful to Propel for giving us this opportunity to speak directly to you at this very difficult time where people are hungry for knowledge about things that might help their business on the other side of COVID-19.
Rob Liddiard 00:42
We talk a lot about something called social leadership in Yapster. That's the business of influencing people at work using digital tools. Well, rather than focusing on the digital tools, part of that equation, let's really drill in and think about influence at work. I'm ever so proud to announce that today. We've got a very special guest speaker who happens to be a Yapster partner for you, Steve Martin.
Rob Liddiard 01:06
Steve's a visiting professor at Columbia Business School. But you might know him well, you're more likely to know him as the co author of Yes - 50 secrets from the science of persuasion. That's a New York Times bestseller also a Wall Street Journal bestseller, Steve's been recognized by The Harvard Business Review, he's a real authority on the science of influence and persuasion.
Rob Liddiard 01:28
None of us know what the world's gonna look like coming out of COVID-19. But what we do know is customers are going to be different. They're going to want different things. I really hope you get some value out of the next 30 minutes from your conversation with Steve, thinking about how you can play your part in influencing tomorrow's customers to want the things that you're able to offer them - so that your business can definitely survive, but hopefully thrive on the other side of this thing.
Rob Liddiard 01:53
We believe in Steve's message in his teaching so much, that - one of the things Steve's going to talk about is scarcity in his training... So on a "scarce" basis - we believe in it so much we're going to offer the first 15 customers that sign up to Yapster on commercial terms on the other side of COVID-19, a complimentary consulting package with Steve, on us. We think that's going to pay for your Yapster license on its own many times over. And that's aside from all the benefits that you should get from our platform directly.
Rob Liddiard 02:23
Our hope is that as a national industry, the UK hospitality industry, we're going to become world leading practitioners on the business of influence for the benefit both of our colleagues, Yapster's business, but also for customers too.
Rob Liddiard 02:37
Enjoy.
Steve Martin 02:39
Well, hello, everyone. My name is Steve Martin. Not that Steve Martin, you'll recognize I'm Steve Martin, a persuasion scientist and I recognize that the job persuasion scientists might sound rather mysterious. You know, what is a persuasion scientists? Well, essentially what I do is I'm interested in researching what influence people's decisions persuades them to make and take the actions that they do and how we can use those insights to change behaviors, not just the behaviors of clients and customers, but of our staff, everyone that works in our organization. And I don't use that word science lightly.
Steve Martin 03:17
Over the course of the next 30 minutes or so, I'm not going to be sharing with you ideas that I came up with down the pub or hunches that I think might influence and persuade people to change and to act. But rather, I'm going to be drawing on a broad basis of science, some six decades of research that shows how anyone can increase their ability to successfully influence and persuade people in entirely ethical and effective ways just by understanding a few of the rules of the science of influence and persuasion.
Steve Martin 03:51
So let me start by talking a little bit about how most of us generally think about the best way to influence and persuade people and what most People tell me is that they're told, well, if I have some good information, you know, if I've got a product to offer or a good proposition to present to someone, and that information, that proposition or that proposal has some sort of, you know, financial carrot attached to it some sort of economic benefits. If I have those two things, then in the main people say yes, to those types of requests, and I'm not suggesting that that's necessarily a misinformed way. But all of us can recognize situations and times where we've had a good offer to make, we've had a good proposal to present to people and it's made good economic sense, you know, the price is right, the offer is right. And yet many people still say no to it. So there must be something else going on beyond information and incentives, that causes people to listen, to pay attention, and to say yes to requests.
Steve Martin 04:53
And that secret source of influence, if you like, I think is largely kind of covered off in what I'm doing. To describe as behavioral science, this set of insights that combines learnings from psychology from economics and increasingly from cognitive neuroscience, that allow us to understand to predict and influence how people are likely to behave. And because it's based on science, and because it's evidence based, we can test these insights and we can measure their approaches and the impact that they actually have. And what I think you'll find, particularly in the hospitality industry, given the challenges we have at the moment, is that it's not necessarily big, costly strategic changes that often carry sway, sometimes very small, but scientifically informed, very often costless changes can make a very, very big difference to our business.
Steve Martin 05:54
Let me give you an example of what I mean by a small change. Consider if you would For a few moments, these two price lists. As you can see, the wines on the lists are exactly the same. The prices are exactly the same. And likely the bar hotel, restaurant or pub in which these wine lists are presented to customers probably have similar levels of service and quality as well. So there's nothing really different between these two wine lists, except the way in which the wines are presented on the actual menu. So as you can see, on one, the house wine, the cheap wine typically is at the top and the wines ascend in price as you look down the list, whereas the other one has the most expensive wine in that premises at the top, and they descend in price.
Steve Martin 06:43
Now, when you think about this, nothing in terms of the information, nothing in terms of the incentive on offer, ie the price has changed. So if we were to present these lists to consumers to customers, and then record what wines people choose, there really should be no difference between the two menus because they are, to all intents and purposes exactly the same.
Steve Martin 07:07
Except that's not what we actually find. When we provide the wine list with the cheapest wine at the top, and the more expensive ones descend, as you look down the list, what we find is that the most popular wines chosen so this is not all the wines, but the ones that typically are chosen the most frequently are wines a and wines B. And you'd expect that to be the same on the second list where the wines and the prices don't change. But that's just not the case. Look at this. When we position the most expensive wine at the top, suddenly wines D and C become the more popular wines, wines, they're a little bit more expensive, possibly put a little bit more cash into your business possibly create a little bit more profit for you as well. And this is just a simple example of how sometimes a small change in the way that we present an idea or offer a proposal, in this case to customers or potential customers can significantly increase the impact and the influence that we actually have.
Steve Martin 08:10
So I want to talk about some of these small changes and a little bit more detail, offer up some examples, specifically in the hospitality industry, of where we've studied, not just me, but other researchers as well. approaches to influence and persuasion that can have some pretty successful impacts just based on a small change that we actually make the words we use the timing of an offer, or the way that we actually convey a presentation or a proposal, which is kind of important in the context of restaurants for example, where sometimes a change in order or comparison and the influence it has can mean dramatic impacts and results for that business. In fact, we're undergoing research at this moment in time showing how we can apply these insights to menu design. Simply thinking about the way in which products offers are presented to consumers can have a significant impact on how much they spend on what they choose to order. But perhaps we can talk about that another time for today.
Steve Martin 09:10
Let's talk about the factors that primarily are most important when it comes to persuading people to say yes to your requests. And as I suggest, it's not the case that we always pay attention to the information that's available to us and make considered decisions. Often we use shortcuts to determine what we choose to pay attention to, and what we choose to say yes to. And I want to talk about six of these shortcuts, the most important ones, as far as the research is concerned, here they are: reciprocity, scarcity or authority, consistency, liking and consensus. Let me give you a definition of each of these in turn, and share with you just a simple example of how you can use it to increase in an effective and ethical way, your influence and your persuasion.
Steve Martin 09:54
So let's start with the principle of reciprocity - the idea that people give back to others, the form of behavior that has been first received. And all of us know this. From a very early age, we're taught the role of give and take, if someone does us a favor, we owe a person a favor. If someone helps us, we should help that other person in return. It's the role of given take that binds societies and keeps communities together.
Steve Martin 10:18
Now, how do we use this in the context of hospitality? Well, it turns out there's some really interesting research in serving situations in restaurants where we find that a waiter or waitress can do one small thing that doesn't cost them any money. That significantly increases the amount of tip that a client or a customer is likely to leave them. And it concerns those little mints and candies that are often put down along with the check or the bill at the end of a meal. Now, most people suggest that if you put a mint down along with a bill it has no impact at all on the likelihood to the customer or client will leave that tip. But this study suggests otherwise.
Steve Martin 11:03
In this example, waiters and waitresses, when they went to the tables to put down the bill at the end of the meal included a single mint for each of the diners sitting at the table. And it turned out that just putting that mint down along with the bill had a pretty big effect. It was about a 3% increase in the amount of tips that were given to those food servers compared to the tables where they didn't put the mint down. Now, that alone is a really interesting insight. But what I like about this study is the researchers didn't stop there. They then said, 'Well, what if we gave people two mints'? 'Does it double the increase in tips that are given?'
Steve Martin 11:43
It doesn't. It quadruples it - a 12% increase. And the really interesting thing about this particular study is in another condition, they asked the food server to go to tables, put the check down along with a mint for each person at the table. And then walk away. But then just a minute or two later, go back and put an extra minute down and say "for you nice people, here's an extra candy". And in that instance, there was a 23% increase in the amount of tips given.
Steve Martin 12:15
So this idea that if we give something to someone first, if we look for ways to help others first, they're likely to respond in kind is a really powerful one and ingrained in all of us. So there's an insight in terms of how we can use the principle of reciprocation - in this instance, to increase consumer spend.
Steve Martin 12:34
In fact, I have one other example. This is a study that we conducted about two years ago now in McDonald's restaurants in South America.
Steve Martin 12:44
A lot of families would take their children to these McDonald's restaurants on the weekends and buy them a happy meal, as a big family affair. But what was really interesting was that parents seldom bought something for themselves. They buy a Happy Meal for the kids, but not for themselves. So we asked ourselves the question, 'what can we do that might increase the likelihood that we could persuade parents to maybe buy themselves a cup of coffee when they were buying a happy meal for their kids?'
Steve Martin 13:10
One of the things we noticed that these restaurants often did was, after kids had eaten their Happy Meal and gone and played in the bullpen, on the way out, McDonald's staff would give the kid a balloon as a kind of reminder of their time at McDonald's. Now, if you think about it, giving a gift at the end, doesn't instill the same sense of obligation and reciprocity as giving a gift at the beginning. So we wondered whether or not it would make a difference if instead of giving children a balloon as they left the restaurant, the staff instead gave a balloon to children as they came into the restaurant.
Steve Martin 13:46
It turns out it had a hugely powerful effect. Because when you give a gift to a child, what you're really doing is giving a gift to the parents. And when we did that, when we made that small change, which by the way cost no money because they were going to give the balloon anyway, we registered a 25% increase not just in family sales, but a 20% increase in associated sales. The associated sales in this instance were cups of coffee, that the parents felt obligated to buy themselves, because McDonald's had given a balloon to their child first.
Steve Martin 14:21
So there's a couple of examples of how we can bring to bear this powerful Rule of Reciprocity to influence consumers and persuade people to say yes.
Steve Martin 14:31
The second principle I want to talk about is scarcity. Simply put, people want more of the things they can have less off. We call it FOMO these days - the fear of missing out.
Steve Martin 14:40
Here's an example, some of you will recognize: the British Airways Concorde, which flew twice a day, every day for 27 years between London and New York and return. But in early 2003, British Airways recognized that the Concorde was becoming increasingly uneconomical to run and so they announced publicly that they would be ending the service at the end of that year. What was really interesting was that the very next day, you couldn't buy a seat on any of the subsequent flights for the rest of the year for love or money. It's almost like everybody suddenly went, well, if I can't have it, I want it more.
Steve Martin 15:22
They couldn't sell a seat for level money. The day before the moment they announced that it was no longer available. The next day, everyone wanted it, nothing changes about the flight. By the way, if you notice, it doesn't fly any faster. The service doesn't get any better. The price certainly didn't come down. But in the context of that scarce availability, our attention, our desire for things goes up considerably.
Steve Martin 15:47
One of the most important aspects of this principle of scarcity is what I call 'loss information'. If we say to people, if you do this, you'll gain something, it turns out that it's vastly less effective. If we say to people, if you don't do this, you'll lose something. In this instance, we can double the number of people that respond to a message by pointing out not what they'll stand to gain if they move in one direction, but rather, what they'll stand to lose if they fail to. So things like not just limited time offer, but limited number of offers work especially well, we find in hospitality, that having, you know kind of menu offers that say, this ends on such and such a day is actually less effective than limiting the number of offers per day, you know, 50 diners are entitled to this or the first 100 that come through our store or the first 50 that download our app. limited numbers in this instance, create a much more productive use of scarcity than limited time offers.
Steve Martin 16:49
The third principle I want to talk about is the principle of authority. Often when we're uncertain, we're unsure about what the right thing to do is, we follow the lead of credible knowledgeable experts. We look outside ourselves and think, 'well, if the experts are telling us to do it, then it's probably a good thing for us to do'. We know this.
Steve Martin 17:06
In fact, let me give you an example. This is a study I ran a few years ago in London with estate agents, where we found that estate agents were much, much more likely 20% More likely, in fact, to increase the number of appointments they could make with prospective clients. If, when a client was interested in selling their property, and they contacted an estate agent, rather than the receptionist, simply saying, 'I'll put you through to rob who's our head of sales', they instead said, 'Let me put you through to rob who's our head of sales, who has 10 years experience selling property in this area', just simply giving someone some information about the fact that the person they are introducing them to as an expert, led to a significant uplift in the number of appointments. In fact, we also found that they increased by 15 and a half percent. The actual contracts the sign sales that they actually made.
Steve Martin 17:57
So sometimes one way in which we can focus people's attention and the likelihood that they'll say yes, it's not just to think about what we offer them. But the way that the person that's making the offer is introduced, maybe we could tell potential clients about the expertise of our staff, why they are particularly knowledgeable about the menu or about the hotel or about the offer or the service that you're actually making and why their advice might be worth following in that instance. Anything we can do to raise the expertise and credibility of our staff does two things. Not only does it raise the credibility of the advice and the recommendations they make, but as leaders, we're also providing labels to these people to live up to. If they are seen as expert, competent people, and that they hear that their supervisors and their managers are talking about them in such a way, they're probably going to live up to those labels, and the resultant impact on customer service and satisfaction is likely to go up as well.
Steve Martin 18:59
The fourth principle is the principle of consistency. All of us want to live up to our commitments, our values and our self ascribed traits. It's important that people know that if we say we're going to do something, then we should do it. I'll give an example from a study I conducted here in the National Health Service in the United Kingdom. It was actually inspired from an older piece of research that was done in restaurants that concerns that challenge of people phoning up to make a reservation and then failing to show up hugely costly for everyone involved. What we did in this study, when people phoned up to make an appointment at a doctor's surgery, we simply asked the receptionists to ask the patient to repeat back the time and day of the appointment they've been given. So rather than simply saying, Come to us next Tuesday at 2:30, before putting the phone down, the receptionist simply said, 'could you just repeat back that time and day that you've been given?' and after they did that we measured whether the people that repeated the time and day that they've been given in confirmation were less likely to turn up.
Steve Martin 19:59
The fact is, there was in that instance, when measured compared to people that weren't asked to do that, a three and a half percent reduction in no shows. Three and a half percent doesn't sound like an awful lot, but when you're making millions and millions of appointments every week in the NHS, it's a significant impact. In fact, we also found that if we got people, when they were at the reception desk to write down a little card, the time and day of their appointment rather than the receptionist do it, we've got an 18% reduction in no shows.
Steve Martin 20:26
So the impact for you here is if you suffer from no shows, or if you want to increase the likelihood that people do live up to their reservations and their commitments, anything you can do to get them to make some sort of verbal commitment, ideally, an active commitment, maybe they could, you know, forward on the invitation or the reservation to their friends so that other people know about it. That's a really important aspect.
Steve Martin 20:48
The other thing that's important when it comes to these initial commitments that we ask people to make is to think about how we can use it in the context of loyalty. Many of you will recognize these cards that you often get when you buy a coffee from your local Starbucks or your local Nero, for example, where you know you're given a card and each time you buy a cup of coffee, you get a stamp. Is there a way in which we can use these cards to increase the likelihood that not only will people join the loyalty scheme, but also they'll be more likely to complete it as a result and accordingly, spend more money?
Steve Martin 21:23
It turns out there is something you can actually do. Take a look at these two cards for a few moments, they look largely similar except card A requires you to buy eight cups of coffee and you get a nice coffee for free. Whereas scheme B requires you to buy 10 cups of coffee and you get your 11 for free. Now, if we give these two people and ask them which one they prefer, naturally, they're going to choose card A over card B, because they have to buy less cups of coffee in order to get the free one.
Steve Martin 21:50
But... notice if we do one small thing - make a small change to card B by simply giving two stamps to get people on their way.
Steve Martin 21:59
Now economically, these cards are exactly the same. You have to buy eight cups of coffee and get your ninth for free in this instance, except scheme B is a card that has already been started. And that presents a really interesting psychological incentive. People are much, much more likely to pick up on projects and start something that's already begun than we are to start something from scratch. What evidence do I have for this? Well look at the evidence in terms of the number of people that subsequently complete the card and claim their free gift or their free coffee in this instance: 19% for those that are given a card that isn't started from the start from scratch, but those that are given the head starts - 34% of them complete the card, and actually interestingly completed in a quick time.
Steve Martin 22:53
So looking for ways in which we can give our clients or consumers or customers a head start in order to gain is also a really important way in which we can use this commitment and building principle that I've spoken about.
Steve Martin 23:07
So we have two more principles: liking - no surprise. I'm sure that many of you will absolutely know that we prefer to say yes to those people that we like. But who are the people that we're most likely to like? What is it that causes one person to like another?
Steve Martin 23:23
There are three really important things in the research that I think we should focus on. The first is, we're much more likely to say yes to people because we like them because we see them as similar to us. So, you know, training staff to think about ways in which they can communicate similarities between themselves and hotel guests or restaurant patrons is going to be a good idea. We're more likely to be then open to their ideas open to their suggestions.
Steve Martin 23:48
We especially like people who cooperate with and we particularly like people who pay us compliments, importantly, genuine compliments. In fact, there's lots of research from hospitality. See settings that show that food servers, maitre D's, customer service operatives who genuinely give good compliments to their clients. 'That's a really good choice' or saying 'I think you've made a really good selection there' not only results in greater satisfaction and rated satisfaction from their customers in that instance, they actually receive greater tips and customers are actually more likely to return as well. So ways in which we can look for using genuine compliments of our customers is an important one.
Steve Martin 24:31
And finally, we have social proof or sometimes we call this consensus - the idea that we can influence people not by presenting our ideas, but showing them what other people like them are doing, creating that kind of momentum. That social norm in that instance, is an example I'd like to give.
Steve Martin 24:50
Take a look at this restaurant menu, it's for desserts. In fact, it turns out, there's something that a restaurant can do or that is menu Immediately increases. The popularity of a particular desserts, in fact, increases its sales by 18%. What is it that they can do? Here's what they can do: they can put a message next to their most popular dessert that simply points out 'this is our most popular dessert'. And in the studies, an 18% increase in the sale of those desserts, not just the most popular ones, but all desserts. It seems it has a category effect. We're not just popularizing a particular dessert, the carrot cake in this instance, we're actually making available to people information that ordering desserts is popular, and as a result, all dessert sales went up.
Steve Martin 25:49
We were intrigued by this study and given that we were working in McDonald's, we thought what a perfect opportunity to use it on their burgers. What if we put next to their most popular burger a message that honestly points out, 'this is our most popular burger'. That's exactly what we did. And when we measured the results, we found... no difference! Nothing happened. no impact whatsoever. We kind of went crazy about this, we're kind of thinking, 'Well, why does it work for desserts but not work?' For burgers, that doesn't seem to make sense, it's the same message.
Steve Martin 26:26
And it turns out, there is a reason for this: people are much, much more likely to be open to a discretionary offer or an extra spend in those instances where they haven't already made their minds up. Most people that go into a burger bar, have probably already got a good idea in their mind about what burger they're going to buy, they're going to buy themselves, you know, so they're unlikely to be open to sway in that instance.
Steve Martin 26:51
But most people don't go into burger bars thinking about what dessert they're gonna buy. And so we replicated the study, and instead of this time pointing out, 'this is our most popular burger', up on the desserts menus in McDonald's, we put a message that said, 'this is our most popular dessert'. And in that instance, we increased the sales of McFlurry's by 48%. But we actually increased the likelihood that people will buy a dessert by 52%, as well.
Steve Martin 27:18
So, you can see how using some of these insights from over 60 years of scientific research into the influence and persuasion process, rules of reciprocity, scarcity, authority, consistency, liking and social proof or consensus can have a significant impact on whether someone is likely to say yes to you.
Steve Martin 27:37
The key is to understand how they work, use them appropriately, use them honestly, and use them ethically, to increase the likelihood that others will say yes to you. But my guarantee is that if you do do those things and use them ethically, effectively and responsibly, then the opportunities for all of us are boundless.
Steve Martin 28:01
Thank you very much indeed for your attention. I've enjoyed this time with you and I hope that some of the insights that I provided in this short time together are going to be not only helpful to you, but importantly, practical and applicable
