Have You Thanked an Academic Today? 3 Studies That Offer Lessons for Entrepreneurs About the Human Psyche. Q. What does the human psyche have to do with business? A. The better you "get" the people around you, the more you can achieve.
Edited by Dan Bova
As an entrepreneur, you are likely to find it highly valuable to have a fundamental understanding of how the human mind works.
Related: How Marketing Psychology Can Improve Your Bottom Line
You need to know what makes your customers tick so you can develop the best products for them. You need to understand how your employees think and act, so you can help them perform their best and set realistic expectations for the workplace overall. You also need an innate understanding of communication patterns and human interactions, so you can negotiate better deals with your vendors and partners.
You can get a lot of this through experience and intuition; the more you're exposed to people and the more you work with them, the better "feel" you'll develop for how people think and act. But if you want a shortcut to better understand the human psyche, look no further than these important psychological studies:
1. The "bandwagon" effect
A recent study in the Journal of Media Psychology examined the "bandwagon effect," describing the psychological phenomenon in which people tend to follow the mentality of the group. In the study, 765 participants were told they were a part of a study about news coverage before political elections, and were asked to read a news article about a mayoral election in a fictitious German town.
Participants also received information on fictitious candidates running for the town mayor. Then, participants were assigned to one of three groups; a control group that saw no polls; a group that was told the central candidate was leading in the polls by a wide margin; and a group that was told that that same candidate was trailing in the polls by a wide margin.
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Participants were then asked to indicate whom they'd vote for, who they thought would win, and how competent they perceived the candidates to be.
The study demonstrated that when candidates led in polls, they were more likely to be seen as competent -- and more likely to win votes.
What does this mean for entrepreneurs? It shows the importance of establishing your brand's reputation early on, and implying that the brand is popular even if that's a bit of a stretch. Social proof, reviews, testimonials and other assets can improve your brand's reputation or perceived reputation and have a strong impact on your customers and conversion rates.
2. Word choice and negotiations
An older study by Harvard researcher Ellen Langer explored the power of word choice in attaining leverage and getting what you want in a social setting. In the study, participants lined up at a photocopier, while another person asked to cut in front of them in line by posing a specific question:
- Line-cutters who used the flat, direct question, "May I use the Xerox machine?" without a reason or justification, were allowed to do so 60 percent of the time.
- Line-cutters who asked, "May I use the Xerox machine, because I'm in a rush?" were given permission 94 percent of the time
- Line-cutters who said, "May I use the Xerox machine, because I have to make copies?" got permission 93 percent of the time.
There are two big takeaways to note here. First, explaining your reasoning for a request, however briefly or obviously -- particularly when you use the seemingly magic word "because," drastically improves your chances of having your request met. In fact, word choice is everything here.
Second, you'll be surprised how often simply asking for something can work out for you. Even in the above scenario that used the bluntest language, those who asked to cut in line were allowed to do so a whopping 60 percent of the time. So, the takeaway is: Don't be afraid to ask for what you really want when negotiating.
3. Christmas cards and reciprocity
In the 1970s, Brigham Young University sociologist Phillip Kunz wondered what would happen if he sent Christmas cards out, randomly, to total strangers. He went through the directories of local towns, and sent a Christmas card, complete with a photo of him and his family, to 600 total strangers.
Over the next few weeks, Kunz collected more than 200 cards in kind -- despite having no social connection to the people sending them. Some of them even came with handwritten letters, multiple pages long. Kunz's action seems like a silly experiment, but it demonstrates the power of reciprocity: the tendency for human beings to reciprocate when given something of value.
The power of reciprocity is what drives many content marketing campaigns; modern marketers understand that they have to give something valuable to their prospective customers (i.e., helpful, original content) if they want something in return (i.e., purchases and conversions). Reciprocity, then, is a helpful insight to know when you're negotiating with clients, partners or employees. In short, you have to give a little to get a little.
What can we learn from these studies? At least one, or perhaps all three, should resonate with you, offering key insights you might not have realized about human behavior.
