One seminar handout — three optionsArticle added by Matt Neuman on December 14, 2012
Topeka , KS
Joined: August 21, 2010
Ranked: #189 (376 pts)
The dominated option of behavioral economics states that if you’re persuading people to make a decision, giving them only two options isn’t optimal.
How much impact can one small change really make? This week, I’ll challenge your thinking and ask you to integrate the basic behavioral economic “dominated option” into your seminar appointment process. A very successful advisor recently did exactly that and has experienced powerful results.
Three months ago, his seminar appointment ratio was declining. Where it used to be 45 percent to 50 percent at each event, things had started to slip closer to 40 percent, and even more recently, they were averaging closer to 35 percent. So only 1 in every 3 households at the seminar were setting appointments; he knew something had to change. He looked to tweak the appointment process at the seminar, the message given during the event and even how the initial invitation read to prime the prospects beforehand. All of that was great education, but in the end, just one material change was made: integrating a dominated option to his evaluation form filled out by prospects. And success followed.
The dominated option of behavioral economics states that if you’re persuading people to make a decision, giving them only two options isn’t optimal. Do you want a glass of water (yes or no)? Do you like my shoes (yes or no)? Do you want to meet with me in my office (yes or no)?
With every choice in life, nothing is good or bad, except by comparison. Every choice needs to have context. So, instead of asking, “Do you want a glass of water?” where most of the time you'd answer no, what if I said, “Do you want a glass of water? And do you like it better in a chilled glass or bottle?” What if, instead of saying “Do you like my shoes?” (where all of you would say yes, but that’s beside the point) I said “Do you like my shoes? And if so, would you like them better in brown or black?”
Those two small examples now give me a 2 in 3 chance of hearing a yes versus a no. So, my odds are greatly improved. But let’s take it a step farther and look at the biggest advantage — the dominated option. What if I threw the question, “Do you want to meet with me in my office?” out entirely, and replaced it with “Do you want to meet with me in my office? And if so, would you like a free tax return this year/copy of my book/will established for free? (Fill in the blank that’s better than "an appointment.")
Right now, I’m guessing your seminar evaluation sheet has two options. Option one is requesting a no-obligation meeting at your office and option two says no thanks. That’s polite, non-threatening and the easiest way to do it, but not the most effective. To improve, spend time crafting a third option. That third option should have someone requesting a no-obligation meeting with you and something else in addition. Even though clients are still making the choice to meet with you or not meet with you, adding the dominated option will noticeably improve the ratio of yeses. Is it rational? Nope. Does it work? Absolutely.
Going back to the advisor previously mentioned, he first had two standard options for seminar prospects and it wasn’t working. He made the change and now has three options on his response form: 1. No, I don’t want to meet; 2. Yes, I want to meet; and 3. Yes, I want to meet and a free complimentary copy of you book. Since making the change, he had a 70 percent response at their next couple events and is consistently above 50 percent at each subsequent event since. Nothing else about his workshops has changed. So, this is the only (and obviously powerful) variable in play. Don’t delay in making this tweak. And if you’d benefit from seeing his actual evaluation form, I’m happy to share it.
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