19 January 2015

How retailers use the principle of scarcity to influence our purchasing patterns

In the run up to Christmas I found myself logging on to the website of a well-known online retailer on a daily basis.  They had a fantastic deal on for the latest must-have gift for 8 year old girls.  But curiously they had no availability, either for collection from one of their stores or for delivery.  So why would they have a special deal on, yet no availability? What was going on? It made no sense!

Or did it?  Why would retailers have a deliberate policy of heavily advertising a toy on TV, promoting it on their website, and then under-stocking it.  Thinking back a similar thing happened last year.  And the year before…

Given how sophisticated retailers are at analysing consumer behaviour, they couldn't keep making the same mistake, so this must actually be a deliberate strategy.  But why?  There doesn't seem to be any logic in promoting but not stocking the most sought-after gift.

What they are actually doing is using a very powerful influencing tool – that of scarcity.  The more difficult something is to get, the more we can end up wanting it.  We are all too familiar with more blatant versions of this tool: “Sale must end Friday!”, “Only 4 flights left at this price!”, “Limited edition available for a short time only!” and so on.  Adverts on TV implore us to buy now, before the sale ends, and despite knowing in our heart of hearts that the sale won’t end, we find the deal harder to resist when we think they might run out.

But as easy as that is to recognise and understand it doesn't fully explain what is going on when the desired product or service is not available at all.  To understand that we need to reflect on what actually happens when we find we can’t get what we really want, because it is in such short supply?  What did I do this Christmas?

In the run up to Christmas my little girl wrote her letter to Santa and on it specifically included this particular toy. To increase her chances of getting it she also “mentioned it” in passing to me, her mum, her grandparents… naturally I wanted to make sure it was under the tree on Christmas Day. Yet I couldn’t find it anywhere.  So I found something else. Something better to make up for the disappointment.  So the retailer had my money, but despite my efforts my daughter still wasn't going to get the one present she really wanted.

We’re now well into the New Year and guess what – that treasured toy is available.  January is traditionally a hard time for retailers as consumers cut back on their spending.  Hence the sales.  But this toy isn’t in the sales.  It’s at full price, and kids are spending their Christmas money on it, and parents and grandparents are falling into the trap of buying it to make up for not being able to get it for Christmas.  This principle doesn’t just apply to gifts for children (although admittedly with the added pressure from them this makes it an even more effective approach).

So the retailers have not only made the sale in December, when they were pretty much guaranteed to, but they have also managed to boost demand post-Christmas as well by cleverly manipulating the scarcity principle to ensure we continued to buy in January that which we couldn't get hold of in December.

And the beauty of it is, even when we know it’s happening, we still can’t resist the lure of that deal.  Get it while you still can!

29 November 2011

7 Observed Characteristics of High Performing Teams

Through experience of working with teams from all manner of diverse organisations, we have observed 7 consistent characteristics that differentiate the high-performing teams, in any environment, from the rest.  In order to consistently stay ahead of the pack, a high performing team will typically exhibit the following characteristics:

1 – A clearly defined vision and goals

A team differentiates itself from a group by having a shared goal.  The high-performing team differentiates itself further by having a clear vision that describes the team’s very reason for being.  It sets, communicates, and reviews SMART goals that support this vision so that its members are clear about their priorities, and as a result consistently act in ways that support the team’s overall mission and goals.

2 – Clear team roles

All team members understand their roles and those played by others, and efficiently utilise  every team member’s  skills and abilities. They are also clear about the connection between team goals and their day-to-day activities.

3 – Effective team leadership

Team leaders define the team’s goals and priorities, encourage collaboration among team members, clarify priorities on a continuous basis, and work constantly to create a supportive team environment.

4 – World class communication

Members of a high-performing team share information freely, openly, and honestly; listen to each other; and regularly offer each other constructive and positive feedback.  Information is disseminated regularly through formal and informal means.  Meetings are managed effectively to be focused, timely and necessary.

5 – Positive relationships

Team members respect, support, cooperate with, and trust each other. Such teams proactively work to build positive relationships. Teambuilding activities are carried out as part of an ongoing process of managing the work environment, encouraging the active participation of all team members.

6 – Development opportunities

Members of a high-performing team have access to ongoing development opportunities in technical, professional, and interpersonal skills, through a variety of means including formal training, coaching and mentoring, and developmental assignments.

7 – Timely Decision-making and problem-solving

A high-performing team will identify and resolve problems, manage conflict, and make decisions effectively and in a timely manner.  Team members are actively involved and brought in to the process as appropriate.

ACT Now Team Development Ltd. specialises in the area of working to help teams develop through teambuilding activities, coaching, workshops, and facilitation, all of which align perfectly with the goal of developing the characteristics above.  Please contact us if you want to know how we can help to keep your team ahead of the pack.

1 November 2011

Key Coaching Skills: Active Listening

Flick through the index of almost any book on coaching, and you will find more page references to listening than any other topic.

Alison Hardingham asserts that active listening “is the single most important skill for a coach” and that “questioning is the second most important skill, and together with active listening probably achieves 80% of the positive outcome of coaching”.  

The criticality of deep listening is a common thread throughout coaching literature. No doubt is left in the reader’s mind that to be a good listener one must be an active listener. Hardingham explains that to be actively listening the listener must demonstrate their level of attention. This includes both verbal and non-verbal signals that they are genuinely absorbing and responding to what is being said. A good listener will be both audibly (through encouraging noises and words) and visibly (through attentive body language) signalling that the listener has their full attention.

As well as indicating their level of attention, good listeners are not just listening to what is said, but also to how it is said, and to what is not said. Julie Starr points out that paying attention to and picking up on the tone of voice enables the listener to hear beyond the superficial level of the words spoken and potentially uncover far more subtle information.

Bob Thomson describes Levels of Listening, the inference in each version being that the higher the level the better the listener. In Thomson’s version the steps are:
  • Not listening
  • Listening, waiting to speak
  • Listening to disagree
  • Listening to understand
  • Listening to help the client understand
Any coach must spend the vast majority of their time either listening to understand, or better still, listening to help the client understand.

Nancy Kline talks about the fact that people interrupting is a ritual of power, and in many organisations urgency is actively cultivated, leading to situations where whole organisations seem “pathologically incapable of listening”. The corollary is that, to be a good listener, one must be at ease with oneself. Being at ease with oneself makes it easier to operate at higher levels of listening, without feeling the need to interject. 
Almost everyone will tell you they are a good listener, but active listening, listening to help the client understand are skills that a coach takes years to master.

If you would like to experience what it is really like to be listened to then try a free trial coaching session.  You hold the answers to your own challenges in your mind - you just need someone to listen to you to help to break through all the noise.