|
Buy an insignificant object on eBay for a dollar, spin a story around it, and sell it right back on eBay for 30 dollars. Doesn't matter if the object you have put up on eBay is displayed right next to another one that looks exactly the same, and is selling for a dollar - you can still sell your object - the one with a nice story spun around it - for 30 dollars. Sounds incredible?
That's exactly what Rob Walker did - not once, but across several such "objects", in an internationally acclaimed experiment that came to be known as "Significant Objects". Rob Walker is the author of a book called Buying In, where he explores consumer behaviour traits and in particular, buying behaviour of consumers.
For this experiment, Rob roped in several authors and writers, each of whom bought completely insignificant objects from thrift stores - all for around a dollar (the average price of all purchases was $1.25). These objects included assorted stuff - mugs, cigarette holders, tiny animal shaped objects, pepper shakers, pillows, plates - a huge variety of really insignificant objects. He then asked each writer to create a story around the object, put out the story and then offer the object - now with a story spun around it - for sale.
An ordinary coffee mug now had a story spun around it of how it came to be known as the Death Mug, a little horse shaped object now had a story that linked it to a famous rockstar, a pepper shaker got a poignant story of loneliness appended to it - and so on. 200 writers spun stories around a wide assortment of such objects and then put up these objects for sale - now with stories wrapped around them. These insignificant objects had overnight become significant objects and sold at an average mark-up of 2900% - that's 29 times the original purchase price. And, many of these "significant objects" were actually displayed right next to their "insignificant" counterparts on eBay - similar objects but without any story spun around them. Yet, there were ready takers who paid 29 times more than the actual cost of the object, for the objects with stories around them.
Rob Walker and his team donated the proceeds of these sales to charity - it was after all an experiment, to establish a point.
What can we learn from this experiment?
What Rob Walker did was to tangibly establish the value of stories in attracting consumers to products and services. We know anecdotally that stories sell - but what he vividly demonstrated is the power of stories and the extent to which they serve to enhance the value of a product or service in the eyes of a consumer.
We see this happening around us, all the time. We pay 20 rupees at a nursery for a plant sapling, but pay 200 rupees for the sapling of a fortune plant - a Chinese bamboo. Why? Because there is a story around the Chinese bamboo about how it brings good fortune into the house / place of work. Same is the case for various other "good luck" objects - whether prescribed by Feng Shui or Vaastu. Without any desire to offend any religious sentiments, but purely from a logical standpoint, we pay a lot more for a thread we tie around a sacred tree when making a wish, than what we would pay for the same thread sold in a shop in the next street, as a simple thread. There are stories, there are beliefs that make these objects worth a lot more in our eyes than their intrinsic value, when shorn of the stories and beliefs.
The point here is not to debate the veracity of the stories or to even suggest that cooked up stories are a good idea to sell a product or service. The point here is to recognize that stories have the capability to enhance the perception of value of a product or service in the eyes of a consumer. What true story can you narrate, to enhance the value of what you are offering?
How do we apply this learning in our profession?
These days, investors come across many brochures which talk about financial planning services and the processes that will be followed by the advisor to help investors reach their financial goals. How then can you enhance the value of your offering in the eyes of a prospective client, in this context?
We know that stories help enhance the value of goods and services in the eyes of consumers. Lets take a fictional case of a financial planner called Shyam Kulkarni from Pune, and see how he uses these learnings to enhance the value of his proposition in the eyes of prospective clients.
Here is what our friend Shyam's brochure has to say in its opening page:
December 12, 1969. Chicago, USA. Braving a typical harsh Chicago winter day, Loren Dunton called a meeting at O'Hare Hilton, which was attended by 13 like-minded financial professionals. Loren was worried and uneasy : the investments business in the US was dominated by an "investment opportunity" led sales approach : push hot financial products to American savers. Loren found in the 13 professionals who attended the meeting, a common desire to turn this around. "Why should we take a product and sell it to whoever will buy it? Why can't we be on the side of the saver, find out what she needs and then go out and get her the right financial solution for her needs?" - that was the simple question that Loren asked. Thus was born the Society For Financial Counseling Ethics in 1969, which marked the beginning of what we know today as Financial Planning. The first batch from the College of Financial Planning graduated in 1973. From then to today, the principal code for all financial planners has been simple - move away from selling investment opportunities, to understanding what your clients need. Be investor centric, not investment centric.
There have always been infinitely more investment sellers than financial planners, and there always will be - it's just so much easier! Worldwide, there are around 150,000 professionals who are Certified Financial Planners - who have chosen a profession that binds them by a code of ethics to be investor centric and not investment centric. That's a small fraction of the number of financial services professionals who sell a variety of financial products to investors, worldwide. In India, we have over 20 lakh financial services professionals who sell insurance and mutual fund products and offer stock broking services to Indian savers. There were, at last count, only 1853 Certified Financial Planners across India who chose the path less travelled, who took up a profession that mandates them to be investor centric rather than investment centric, and binds them by a strict code of ethics to be so.
Shyam Kulkarni is one of those 1853 CFPs in India who have consciously chosen to take the road less travelled - to be bound by a code of ethics that mandates him to be investor centric and not investment centric.
Welcome to Kulkarni Financial Planners!
If you were a prospective client reading this opening page of Shyam Kulkarni's brochure, would the perception of value of his services now rise in your eyes? Would you be interested in knowing more about how Shyam can help you with your finances? Would you be more positively inclined to meet him now? That's the power of a story in enhancing the value of a product or service in the eyes of a consumer.
There is indeed, a lot that we can learn from Rob Walker's experiment on Significant Objects!
All content in Marketing Wiz is created by Wealth Forum and should not be construed as views of Kotak MF.
Share this article
|
Marketing Wiz is a joint initiative between Kotak Mutual Fund and Wealth Forum, where we share insights on how distributors and advisors can accelerate their business growth by understanding and applying essential marketing concepts and practices. Marketing is often seen as a relatively weak link in an IFA's practice, and therefore offers high potential to deliver growth, if leveraged intelligently. It will be the endeavour of Marketing Wiz to help you strengthen your marketing capabilities, connect better with clients and prospects, serve clients better and thus enhance your own business growth.