I love it when stores tell you how much on an item you're allowed to buy. Like "limit 5 per customer." Even if you're willing to buy more, they won't accept your money.
I see that as a challenge. Who the hell are they to tell me I can't buy 6? Any time I come across something like that, I basically have to go over the limit. I don't even care what they're selling. Even if it's cat food. I don't have a cat--but if you tell me limit five, I'm going to walk out of your store with ten packs of cat food. I guess that's what they want me to do. It's all part of their marketing angle. They're targetting the combative segment of the market. Me, Rambo, and a few other guys. You can sell us anything. I don't care what is is. If you advertise donkeys for $100,000 a piece, limit five, I'll by ten of them. That's why retailers are placing those limits. They watched Rambo, and figured that angle would work. They're going for that part of the population. Is that what they're doing?
I don't know. According to some studies, when stores place a quantity limit on something, people tend to buy more of it. When tuna is normally on sale, the average buyer of it gets four cans; but when there's a 12 can limit, the average buy increases to seven. I don't think that many people try to buy 24 the way I do. (Or 1200 the way Rambo does.) I guess I'm looking for a fight, and others are looking for a deal. And a product they can use.
But again, they tend to buy more when there's a limit. Maybe the limit makes them think there's a worldwide shortage. They see a limit of 12 on tuna, and figure tuna are going extinct. It becomes a delicacy. Or I guess they perceive value. Ordinarily, people might not really take notice. But a limit is a dramatic move. When a store does that, they seem a step away from giving away the product. Like they're selling it at a loss, or they want to spread out the value to as many custmoers as possible. Or maybe it's just the hard to get angle. Maybe that increases sales.
I think Presidential candidates should use the limit approach. "Obama 2012" is OK, but "Obama 2012--Limit One Vote Per Person" is better. That'll increase Obama's voter turnout. And if he still somehow loses the election, he might still be able to make it as a tuna salesman.
Let's talk about Israeli psychologists Daniel Kahneman and Amos Tversky. Should I identify them as Israeli psychologists? I don't know if I like that. I'm OK with the Israeli part--but psychologists? Just call them Israelis. Israelis Daniel Kahneman and Amos Tversky.
Do you guys know them? Kahneman is a Nobel Prize winner. And as you might imagine, people bring that up a lot when they mention him. He's Nobel Prize winner Daniel Kahneman. Make sure you mention that. He should wear a sash that identifies him as Nobel Prize winner. Just in case he goes to a car wash or a Pizza Hut, and people don't realize he has a Nobel Prize. They need to know they're washing the car of or serving pizza to a Nobel Prize winner.
May I continue, or shall I talk more about the fact that he's a Nobel Prize winner? Let's talk about his Nobel Prize. He got the Nobel Prize for Economics. Even though he's a psychologist. I think that's a little anti-Semitic. Giving a Jewish psychologist a Noble Prize for Economics. If a Jew advances the field of psychology, they'll give him an award for economics. I think they did something like that with Sandy Koufax. He won the World Series, and they gave him an award for Most Valuable Economist. Unbelievable. How does striking out ten batters make you a great economist?
Anyways, Nobel Prize winner Daniel Kahneman wrote a book titled Thinking, Fast and Slow. Don;t bother with it, though. I'm probably going to sum up his ideas right here. And then I'll sue him for copyright infingement. I'll sue him before he sues me. That's a good idea. Maybe I'll win a Noble Prize for it. Is there a Noble Prize for Law?
But anyways, Kahneman and Tversky researched how people tend to misjudge or jump to wrong conclusions due to the way they think. Most other psychologists focused on how emotions sway us. But Kahneman and Tversky got into mental shortcuts that are often effective, but ocassionally misleading.
For instance, they told people that “Linda is thirty-one years old, single, outspoken, and very bright. She majored in philosophy. As a student, she was deeply concerned with issues of discrimination and social justice, and also participated in antinuclear demonstrations.” And then they asked which was more likely. "(1) Linda is a bank teller." Or "(2) Linda is a bank teller and is active in the feminist movement."
85 percent of people chose 2. Even though it's impossible for 2 to be more likely than 1. In order for 2 to be true, 1 must also be true--so 2 can't be more likely than 1. 2 includes 1. In other words, if there's a 50% chance she's a bank teller, there can't be an over 50% chance she's both a bank teller and something else. Just like there can't be a 50% chance a random person wearing a Rolex is worth at least a million dollars, and a 75% chance that same person is worth at least ten million dollars.
(When I wear a Rolex, I make things easy for people. I also wear a sash stating that "I'm worth $14,600,000." I also have that written on the back of my Honda Civic. By the way, my Rolex is fake. My Civic, however, is 100% authentic.)
But people become obsessed with how Linda is a single, outspoken, and very bright 31 yaar old who majored in philosophy, and who, as a student, was deeply concerned with issues of discrimination and social justice, and also participated in antinuclear demonstrations. Those signs point to feminist more than they point to bank teller. So we're too focused on how Linda is all of those things.
Sometimes we're too attached to something we come across early. For instance, doctors sometimes become too attached to the first symptom they see, and that can lead them into making a wrong diagnosis.
And according to some studies, sometimes a random, nonrelated item can sway us.
For instance, applicants are less likely to be admitted to a medical school when they're interviewed on a rainy day.
Here'a another example: Researchers rigged a wheel or fortune to stop at either 10 or 65. They told participants to write down the number, and then they asked them, "Is the percentage of African nations among UN members larger or smaller than the number you just wrote?" and "What is your best guess of the percentage of African nations in the UN?" The people who saw the wheel of fortune stop at 10 guessed 25%, on average. Those who saw it stop at 65 guessed 45%.
Another study had judges roll a pair of dice before mock-sentencing a shoplifter--and the dice were rigged to come up three or nine. The judges who rolled nine gave the shoplifter an average of eight months, and the ones who rolled three gave an average of five months. Which is why any time I commit a crime, I take along a pair of dice rigged to roll three. And if I get caught, I roll the dice in front of police officers, judges, juries, etc. as often as I can.
Kahneman and Tversky also got into economics.
A while ago, a lot of people thought our economic decisions were rational and served our best financial interests, and that our tastes stayed more or less the same. We made rational, selfish decisions, and we didn't switch from Coke to Pepsi.
Social scientists used to think that people are usually rational and have sound judgment--but emotions like fear, love, and hatred can sway them way from that.
But nowadays, another theory is gaining favor: It's not just our emotions. It's the way we think and the mental shortcuts we use. Those mental shortcuts are usually useful--but not always.