Close Close
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards

Life Health > Running Your Business

Understanding decision-making strategies

Your article was successfully shared with the contacts you provided.

Why is selling so easy? Well, think about it. The other person is meeting with you and when he buys, he is putting his trust in you because you are an expert about something that is important to him. If he knew (or was interested in knowing) as much as you on the subject, you would not be necessary.

To make matters even better, this person already has an established and predictable way of making his buying decisions. When he made his first decision as a child, it was really, really hard. After doing it a few times, though, he discovered that he could make “making decisions” a lot easier if he just followed the same steps each time … like the way we all learned to tie our shoes a particular way as a child and still do the same way today.

The purpose of creating this decision-making strategy was to conserve time, energy and to reduce stress. The strategy could then become unconscious and from there it was easy to handle many more decisions by utilizing this strategy. The buyer had created predictability for himself.

Of course, the not-so-good news in this story is that like the buyer, you also developed a decision-making strategy. You also made this strategy unconsciously to save you stress and increase your efficiency. Why is this not such good news? Because, like the buyer, you forgot you have a strategy. Because you are the expert who is trying to help the other person, you unconsciously present everything in the form of a strategy… your own.

Why is that a problem? Well, on days you get lucky, it isn’t a problem. You present what they need and need to hear, you happen to be in the ballpark of how they think, and when the other person says “yes,” you feel great. You have no clue why they said “yes” when so many others say “no.”

Literally, we expect people not just to buy from us, but to buy from us in the same strategic way that we would. When people don’t, we write them off and move on to find someone who “really understands the value of what we have to offer.”

The next critical pattern in the process of making decisions is to listen for whether or not the person makes his decisions based on an “internal reference point” or an “external reference point.” What I mean by external is that they tend to collect advice, evidence or information. This is the kind of person who is most likely to want to talk to his spouse, check with others, review the competition, etc.

When we make a recommendation to a person who uses an external frame of reference, we can anticipate the way he thinks by having testimonials, studies and outside experts he can talk to.

As we come to understand the five essential patterns to the structure of how people make decisions, I will be able to show you exactly how you would use them in a live sales situation. Of course, if you tend to use external frames of reference yourself, you will want to check out what I am writing about with other people or read a book about it. If you use internal frames of reference, you might get a “gut” feel that there is some truth to my message.

Whatever way you go, you will make a decision. Knowing that people are predictable is what makes sales so easy, especially if you become less predictable and more flexible in your own communication approach.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.