Defend Yourself Against High-Pressure Persuaders

Posted by Mark Frauenfelder | Credit Card Blog | Friday 20 August 2010 11:54 am
201008131707 Have you ever bought something from a door-to-door salesperson, or donated money to someone soliciting funds for a charitable cause, only later to wonder why you willingly forked over your hard-earned money for something you didn't want or didn't care about?

I have, and I always kick myself for getting suckered.

How is it that door-to-door salespeople, marketers, car dealers, politicians, strangers, con artists, and cult leaders are able to persuade people to do things that they wouldn't ordinarily do? That's the question Robert B. Cialdini asked himself after falling victim to a huckster's influence one time too many. But instead of shrugging his shoulders, this professor of psychology decided to study the phenomenon and find out if there is a set of common techniques used to convince people to hand over their money or time against their better judgment. And he discovered that indeed there was, and wrote a book about it called Influence: The Psychology of Persuasion.

The book covers the six methods used to influence people to do things that aren't necessarily in their best interest. They are:

1. Reciprocity -- People tend to return favors out of a sense of obligation. Influencers exploit this by extending a small favor (buying them a Coke from a vending machine) in order to get a bigger favor back (having you buy a car from them).

2. Scarcity -- When people are made to believe something is rare ("a limited time offer!"), they will desire it more. In Influence, Cialdini writes about an Indian jewelry store that attempted to get rid of a line of jewelry by lowering the price. Nobody bought it even though the store lowered the price again and again. But when a new salesperson misread the price tags and told customers that the jewelry cost 10 times as much, the items quickly sold out.

3. Liking -- People like other people who are members of their "tribe." Influencers seek to find common interests with their victims, tell jokes, and pay compliments. Flattery, Cialdini found, will get you everywhere.

4. Authority -- Influencers who convince their clients, customers, or marks that they are authorities or experts can gain control over them. That's why they hang diplomas (not always genuine) and pictures of themselves posing with famous people on their walls.

5. Social proof -- People are herd animals. They copy each other. When a magazine salesman came to my door a few years ago, he showed me a stack of subscriptions cards that "people in the neighborhood" had filled out. He pointed out that most people bought subscriptions to three different magazines. Fortunately I had recently read Cialdini's book and I knew he was using the "social proof" technique. I didn't buy anything. (And I'll bet most of the subscription cards were fake.)

6. Commitment/consistency -- People like to behave in a consistent manner. Cialdini recounts a personal experience he once had with a young woman with a clipboard who approached him and asked him if he was a patron of the arts. He said yes. She then said she was selling membership to a club that offered discounts to different kinds of artistic events. Cialdini wrote, "I bought the entertainment package, even though I knew I had been set up. The need to be consistent with what I had already said snared me."

Influence is a user's manual for survival in a hard-sell, high-pressure society. Filled with lucid examples and colorful anecdotes, Influence is not only profoundly insightful, it's a lot of fun to read.

Mark Frauenfelder – Editor-in-chief of MAKE magazine and the founder of the popular Boing Boing weblog, Mark was an editor at Wired from 1993-1998 and is the founding editor of Wired Online.

Defend Yourself Against High-Pressure Persuaders

Posted by Mark Frauenfelder | Credit Card Blog | Friday 20 August 2010 11:54 am
201008131707 Have you ever bought something from a door-to-door salesperson, or donated money to someone soliciting funds for a charitable cause, only later to wonder why you willingly forked over your hard-earned money for something you didn't want or didn't care about?

I have, and I always kick myself for getting suckered.

How is it that door-to-door salespeople, marketers, car dealers, politicians, strangers, con artists, and cult leaders are able to persuade people to do things that they wouldn't ordinarily do? That's the question Robert B. Cialdini asked himself after falling victim to a huckster's influence one time too many. But instead of shrugging his shoulders, this professor of psychology decided to study the phenomenon and find out if there is a set of common techniques used to convince people to hand over their money or time against their better judgment. And he discovered that indeed there was, and wrote a book about it called Influence: The Psychology of Persuasion.

The book covers the six methods used to influence people to do things that aren't necessarily in their best interest. They are:

1. Reciprocity -- People tend to return favors out of a sense of obligation. Influencers exploit this by extending a small favor (buying them a Coke from a vending machine) in order to get a bigger favor back (having you buy a car from them).

2. Scarcity -- When people are made to believe something is rare ("a limited time offer!"), they will desire it more. In Influence, Cialdini writes about an Indian jewelry store that attempted to get rid of a line of jewelry by lowering the price. Nobody bought it even though the store lowered the price again and again. But when a new salesperson misread the price tags and told customers that the jewelry cost 10 times as much, the items quickly sold out.

3. Liking -- People like other people who are members of their "tribe." Influencers seek to find common interests with their victims, tell jokes, and pay compliments. Flattery, Cialdini found, will get you everywhere.

4. Authority -- Influencers who convince their clients, customers, or marks that they are authorities or experts can gain control over them. That's why they hang diplomas (not always genuine) and pictures of themselves posing with famous people on their walls.

5. Social proof -- People are herd animals. They copy each other. When a magazine salesman came to my door a few years ago, he showed me a stack of subscriptions cards that "people in the neighborhood" had filled out. He pointed out that most people bought subscriptions to three different magazines. Fortunately I had recently read Cialdini's book and I knew he was using the "social proof" technique. I didn't buy anything. (And I'll bet most of the subscription cards were fake.)

6. Commitment/consistency -- People like to behave in a consistent manner. Cialdini recounts a personal experience he once had with a young woman with a clipboard who approached him and asked him if he was a patron of the arts. He said yes. She then said she was selling membership to a club that offered discounts to different kinds of artistic events. Cialdini wrote, "I bought the entertainment package, even though I knew I had been set up. The need to be consistent with what I had already said snared me."

Influence is a user's manual for survival in a hard-sell, high-pressure society. Filled with lucid examples and colorful anecdotes, Influence is not only profoundly insightful, it's a lot of fun to read.

Mark Frauenfelder – Editor-in-chief of MAKE magazine and the founder of the popular Boing Boing weblog, Mark was an editor at Wired from 1993-1998 and is the founding editor of Wired Online.

Expense Reports Made Easy with Expensify

Posted by Mark Frauenfelder | Credit Card Blog | Friday 6 August 2010 2:01 pm
Threeicons.right I've never enjoyed filling out and submitting expense reports (and who in their right mind does?). I dislike preparing them so much that I often put off doing it for months. As a result, when I finally get around to submitting my expense report, the accounting office gets upset with me because I've screwed up their quarterly reports. I've learned that it's not a good idea to get on the bad side of the accounts payable department.

Now that I've started using a free online service called Expensify.com, everybody's a lot happier. The thing that makes this service work for me is that it accesses the charges I've made on my credit card (the one I always use for business travel) and all I have to do is tick the checkboxes for each charge that I want to include in a particular report. Expensify imports all the pertinent expenses and adds them to my report. It also generates digital receipts for any expenses under $75, which means I don't have to dig around the bottom of my suitcase if I happen to lose a restaurant check. Expensify calls these digital receipts eReceipts, and they are guaranteed by Expensify to be accepted by the IRS. (Expensify promises they'll pay the difference in taxes that results from the IRS rejecting an eReceipt).

What happens if I pay cash for something? Not a problem. I just take a photo of it with my cell phone and e-mail it to receipts@expensify.com. If I have receipts in my e-mail (like from the airline or hotel), I can forward them to Expensify using the same address.

Expensify's iPhone app is really useful. I can use it to create my expense report as I travel. That means when my trip is done, my report is done, too.

When my report is finished, I enter the e-mail address of the person who handles the report. They get a summary and links to all the receipts, which they can either print out or save online.

Do you use a Web site to help you get something done better or faster? Please let me know about it!

Mark Frauenfelder – Editor-in-chief of MAKE magazine and the founder of the popular Boing Boing weblog, Mark was an editor at Wired from 1993-1998 and is the founding editor of Wired Online.

Review: The Upside of Irrationality, by Dan Ariely

Posted by Mark Frauenfelder | Credit Card Blog | Wednesday 4 August 2010 9:00 am
Upside-of-irrationality-the-unexpected-benefits-of-defying-logic-at-work-and-at-home Economists generally assume that people are perfectly rational beings. In their models, people seek maximum efficiency – that is, they attempt to gain as much as they can for as little investment as possible. In many cases, this model of the rational human being works quite well. For instance, if two stores are selling the same product, you will buy the product with the lowest price (assuming all other variables are equal).

But Dan Ariely, a professor of psychology and behavioral economist at Duke University, doesn't assume that people are always rational. And he's right. Our emotions have a big effect on our decisions, making us irrational. But that doesn't mean we behave unpredictably. In his first book, Predictably Irrational: The Hidden Forces That Shape Our Decisions (published in 2008), Ariely described the fascinating experiments he ran to learn about the surprisingly counterintuitive decisions that people make regarding their financial, professional, and personal lives.

In his new book, The Upside of Irrationality: The Unexpected Benefits of Defying Logic at Work and at Home, Ariely follows the same format to dig deeper into the perplexing behavior of the human animal. In each chapter, Ariely presents a commonly held belief about human behavior, then describes the experiment he carried out to learn about the "biases that plague our decisions across many different domains, from the workplace to personal happiness."

Some of my favorite experiments from The Upside of Irrationality include:

Myth #1 High bonuses boost employee performance. Common sense tells you that if your employer promises you a large bonus for meeting your end-of-year goals, you'll be more likely to achieve those goals than if your employer offers you a smaller bonus. But Ariely ran an experiment (in India, where people's paychecks are low enough that he wouldn't have to break his research budget) and learned that high bonuses can "overmotivate" people, causing them to focus more on the money they might get than on the task at hand, thereby hurting their performance. Medium-sized bonuses are a better incentive to get people to do their best work.

Myth #2 People would rather freeload than work. Economists assume that people (and animals) will seek the maximum reward for the minimum amount of effort. But Ariely described an experiment with rats that had been trained to press a lever to receive a pellet of rat chow. When the experimenter placed a bowl of rat chow in the cage, you might assume the rats would give up on the whole lever business, but instead the rats divided their time between the bowl and the lever. Similarly, Ariely learned that his pet parrot enjoyed opening a puzzle box to get a treat rather than just eating out of her food dish. Many animals, writes Ariely, "tend to prefer a longer, more indirect route to food than a shorter, more direct one." Ariely then ran an experiment on people (using Lego building exercises) and found that giving meaning to a task makes people want to continue the task longer than people who completed the same task when it had been stripped of meaning.

These are just two of many experiments from the book. Ariely believes that if we have a better understanding of our hidden biases, we will be able to "find more compassionate, realistic, and effect ways for people to avoid temptation, exert more self-control, and ultimately reach their long-term goals." And that's a worthy goal in itself.

Mark Frauenfelder – Editor-in-chief of MAKE magazine and the founder of the popular Boing Boing weblog, Mark was an editor at Wired from 1993-1998 and is the founding editor of Wired Online.

An Easy Way to Sell Your Unwanted Gadgets

Posted by Mark Frauenfelder | Credit Card Blog | Friday 2 July 2010 11:51 am
Gazelle-logo I'll admit that I'm addicted to gadgets. I can't seem to go for more than a year without replacing my existing cell phone, digital camera, or video camera with a newer, smaller, shinier, faster model. What do I do with my old gadgets? Sometimes I give them to friends, my kids, or to charity. But even so, quite a few have piled up in a my desk drawer. I was wondering what to do with all these unwanted gadgets. I considered selling them on eBay, as I have in the past, but then I heard about Gazelle.com, a Web site that buys your gadgets from you.

The entire process was painless. I started by entering the names of my gadgets into the search form. As I typed, Gazelle offered suggestions for the name and model of the item. After selecting the correct model, Gazelle then asked me about the condition of the item. I chose "good" for all of them. Then, Gazelle presented me with a cash offer. It offered $268.60 for a Google Nexus One phone, $15.75 for a Flip Video Mino Digital Camcorder, $38.85 for a Flip Video UltraHD Camcorder, and $133 for an Android phone. I accepted these offers. (I turned down Gazelle's offer of $52 for an 8GB iPod Touch and $72 for an 8GB iPhone 2G because my kids can use these to watch movies and play games).

Once we agreed on the prices, Gazelle gave me a link to a page with a FedEx label. I filled a cardboard box with the gadgets (wrapping each in plenty of packing material). I taped the FedEx mailing label to the box and dropped it off at the local FedEx store. About a week later, Gazelle sent me an email telling me that everything I'd sent looked fine, with the exception of the Android phone -- I'd provided the incorrect model number, and it was worth $77.70, not $133. I emailed them back to let them know I would accept the new, lower price.

A few days later, I got a check in the mail for $401.10.

So you may wonder, as I did, what does Gazelle.com do with the stuff it buys? First of all, it erases all the personal information stored on each gadget (I recommend that you remove the SIM cards from phones, and format the memory in all the devices before sending them in, just to make sure). Gazelle then resells the items "through a variety of retail and wholesale outlets." Do they sell them for more than they paid? I'm sure they do. That's OK, they deserve to make some money for the hassle of listing and selling the items. From now on, my old gadgets are going to Gazelle.

Mark Frauenfelder – Editor-in-chief of MAKE magazine and the founder of the popular Boing Boing weblog, Mark was an editor at Wired from 1993-1998 and is the founding editor of Wired Online.

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