Friday, August 08, 2008

awesome sales case

via Hacker News via Piloted

What I Learned Buying a Rug in Turkey

I had no intention of buying a rug on our trip to Turkey in December 2006. Certainly, not on the first day. I'd already purchased a rug; when my son and I had been abducted in Tunis, Tunisia in 1999. But, that's a different story.

Yet, there I was, just 4 hours after arriving in Istanbul, shaking hands with a rug merchant as he packed up our newly purchased kilin carpet. How did this happen?

Educators, business people, publishers, we all seek to influence others, and we are all influenced by others. Perhaps my experience in Turkey, seen through the prism of an expert in the principles of influence and persuasion can help us all.

First, let me describe the events leading up to the purchase. Then, I'll relate those events to principles contained in the book Influence: The Psychology of Persuasion by Robert Cialdini.

Our hotel, the Mavi Ev, or Blue House Hotel, was just across the street from the famous Blue Mosque in Turkey. As soon as we stepped out to go visit the mosque, the first person approached us,

Salesman: "Do you want to buy a rug?"

Me: "No thank you."

Salesman: "Where are you from?"

Me: "No thank you, we're on our way to view the mosque."

In the 50 yards between the hotel and the entrance to the mosque, we were approached at least 5 times, in similar ways. The sales people were pleasant, often humorous, never hostile. But always persistent, asking at least 5 to 6 questions to try to engage us.

"How long are you staying in Turkey?"

"How do you like Turkey so far?"

"Are you thirsty or hungry?"

"Would you like some apple tea?"

"Do you know where you are going?"

After the Blue Mosque, we walked across the park to the Hagia Sophia, and were approached another 5 to 6 times. But, as we walked up to the Hagia Sophia, we found out that it had just closed, and someone came up to us.

Person: "It's a shame that the Hagia Sophia closes so early. Have you seen the Cisterna Basilica, yet? It's still open."

Me: "Yes, that's one of the things I've wanted to see."

Person: "Let me show you where the entrance is, it's just a block from here."

Me: "We can probably find it."

Person: "I know, but it is really no trouble and will save you some time. How long are you in Turkey for?"

Me: "We're staying for 9 days."

Person: "The entrance is just here, make sure that you walk through all of the passages. Some people just go into the Cisterna, take a look, and then come back up. There is a whole passage to follow, and you'll see the pillars of Minerva and eventually come out about a block down the street."

Me: "Thank you."

Person: "I'll wait for you at the exit. In case you'd like to have a glass of tea and see our showroom. There won't be any pressure for you to buy anything, but as long as you're in Istanbul, you should get to know what types of things are on sale."

Me: "Thank you, but we're not buying anything today. If we buy anything, it will be on our last day."

Person: "I didn't say anything about buying anything. After all, no one needs to buy a rug. But, this will just give you a chance to get educated, and no museums or mosques will be open at that time, anyhow, and it will be too early for dinner."

We entered the Cisterna. And, sure enough, at first it seemed that we should just go in and take a look, but we walked around the whole path, and it was definitely worth the extra time. By the way, if you do end up in Turkey and visit the Cisterna, bring a tripod. It's large and dark, and you can get striking pictures with a 2 to 3 second exposure. As we emerged from the exit, who do you think we saw?

Person: "How did you like it?"

Me: "It was pretty extraordinary."

Person: "Did you get to take any pictures? Can I see them?"

Me: "Sure, take a look."

Person: "And, now, maybe you would honor me by taking some time to have a glass of tea, relax, and learn about Turkish carpets. My shop is just 20 meters this way."

And so, on our first day, we ended up in a Turkish rug merchant. But still, we had no intention of actually buying anything. The job of the first person was to bring people to the shop; he was the shill. This was actually the end of our interaction with him. Once in the shop, we primarily interacted with one of the owners.

Owner: "Come, sit down. Let me explain the different types of rugs to you, and educate you so you'll know a good rug from a cheap one. Here, have some tea."

Owner: "You know, no one comes to Turkey to buy a rug. It's not something that you need. Yet, most people end up buying one. Why? Because, it's art. It's something they decide that they like. And, it's something that they will have and enjoy for the rest of their lives. A good rug will last for over 100 years."

Then, he proceeded to explain the five different types of rugs, the different materials, the different types of knots, and how rugs changed colors as you looked at them from different angles. And also, how December is their slowest season, how they would never be able to devote this much time to someone in the summer season, how to tell real wool and natural dyes from synthetics, and how the prices of rugs are usually 25% less in December than in the summer.

After about 45 minutes, with the education winding down, he asked us which, if any, of the rugs we liked, and if we wanted to see more of that type of rug. Rightly or wrongly, at this point, I felt a little guilty. We'd used up 45 minutes of his time, along with three assistants, we'd drunk his apple tea, we'd learned a lot about rugs. I was still not willing to purchase a rug, but we were at least willing to let him know which of the rugs, we liked.

Once the family had picked one of the rugs, he then proceeded to show us about 20 rugs of the same type.

Next, he asked us which three of those rugs we liked the best.

It was then that my wife said, "you know, we really do need to replace the rug in the dining room sometime, as well as the rug in Rosie's (our daughter) room. But, we do not need to purchase a rug at this time."

The owner then asked my daughter, "if you could have one of these rugs, and if you didn't have to pay for it, can you see any of them working in your room?"

And she pointed to one of the rugs. "I really like that one."

Owner to Rosie: "You have very good taste. That rug is 100% wool. Look here, that's how you can tell that they dyes are natural and not artificial. Look at the weave, this is how you can tell it is not machine made. It takes someone three to four months working full time to make a rug like this."

Owner to me: "I know that you are not looking to purchase a rug. In the summer, I would start off with a price of around $3,000 for this rug, and we would easily sell it for more than $2,500. But, if you were interested at all, I'd offer you this rug at $1,800."

Me: "Thank you, but we really are not interested in purchasing a rug right now."

Owner: "Nearly everyone who comes to Turkey is not interested in buying a rug. But, you know, nearly everyone who comes ends up buying one. Because they find something that they really like, something that is going to last them the rest of their lives, and something that they will forever remember their trip to Turkey with."

Owner: "Is there any price, where, if you could own this rug for that price, you would walk out of here happy?"

Me: "Well, I'm really not looking to purchase a rug."

Owner: "Yes, and you may end up not purchasing one. But is there any price where you would say, 'I am happy to buy that rug."?

Me: "I guess, if I could have that rug for $800, I'd probably be happy."

Owner: "This is a rug that I would be selling in the summer for over $2,500. But you know," looking at Rosie, "you are a very lucky young lady to have a father who has the means and the desire to purchase something like this for you that you really want. I hope you appreciate him."

Me: "Wait a minute, that's a line that I've used in sales training before. That comes right from Joe Girardi."

Owner: "You are in sales? What do you sell?"

Me: "I'm in education, but I used to sell and I used to train sales people."

At this point the owner comes right up to me, within about two inches. He grasps my right hand in his, starts shaking it, and says, "I think we can come to a deal. How about $1,500 for the rug?"

Me: "I really didn't come here to buy a rug. I said that I'd be happy to purchase the rug for $800, but it really wasn't my intent to purchase one.

Owner, still holding and shaking hands with me: "How about $1,400?"

Me: "Well, maybe $900."

Owner, still shaking my hand: "$1,300."

Me: "1,000"

Owner: "I just cannot sell it for 1,000, let's say we have a deal at $1,100."

Me: "Okay."

And that was it. My daughter now has a Kilin rug from Turkey in her bedroom. My son is just shaking his head, "Dad, you did it again."

How did the two sales people do it?

According to Robert Cialdini, there are 6 weapons of influence. We can all use them, and they are used on us, either knowingly or by accident:

  1. Reciprocation: we try to repay what another person has provided us

  2. Commitment and consistency: we desire to be consistent with what we have already done

  3. Social proof: we tend to rely on what other people are doing to determine our own actions

  4. Liking: we tend to go along with and follow people we like

  5. Authority: we feel a sense of duty to follow someone who has authority

  6. Scarcity: opportunities seem more valuable to us when their availability is limited

You can see how the rug salesmen used practically every one of these weapons in getting me to purchase the rug.

Reciprocation: The shill gave helped us find a suitable site after we were unable to enter the Hagia Sophia, then, he provided additional instructions to make sure we enjoyed it fully. The shop owner gave us snacks and apple tea, plus spent a lot of time with us educating us on oriental carpets.

Commitment and consistency: Once the shill told me that he would meet us at the exit, and once I had not denied that we would, consistency led us to follow him to the shop. But the real and masterly use of the consistency weapon was by the shop owner, who came up to me and started shaking my hand as we negotiated price. It's hard to back down from making a deal as you are affirming it by shaking someone's hand. I'm going to try that technique sometime with my kids when I need them to do something that they really don't want to do, like pick up their rooms.

Social proof: There was the shaking of hands by the shop owner; if he was signaling that we had a deal, who was I to say we did not? But, there was also the assumptive closing by the shill, saying that we would meet at the exit of the Cisterna Basilica.

Liking: Both the shill used helpfulness, stories, interest in our concerns as ways to get us to like them, to create a rapport, before any selling started.

Authority: We went into a lot of shops in Istanbul. I have to say that in practically every single one, we ended up talking with the owner. Of course, I have no way of knowing if it was really the owner, but the person spoke as someone in authority.

Scarcity: knowing that prices were generally a lot higher, and that was confirmed by my son, who'd been in Istanbul for the past three months, let us feel that we would not have the opportunity to purchase at that price in subsequent trips.

What lessons can we take from this?

First, in subsequent negotiations and interactions, we can be more cognizant of the techniques that the sales people were using; "Oh, this is the 'reciprocation' technique, don't feel that you need to reciprocate. Only purchase if you want the item." Being more aware of these weapons let's us be more resistant.

Second, we can utilize these techniques ourselves. Instead of launching into immediately telling someone what to do (as in "go clean your room", or "do you want to buy this service?"), we can find a way to offer something, we can spend time to insure that the person is in a receptive mood where they like us, we can create a perception of scarcity.

Third, read Robert Cialdini's book. It will provide even more examples to help you manage better, lead better, and resist others who would try to influence you to do things that you don't really want to.

And, with all that, we're happy we bought the rug; it will provide us with a lifetime of memories of our trip to Turkey. If you want to view a short slide show of our trip along with commentary, you can view about 40 pictures at http://www.flickr.com/photos/mweisburgh/sets/72157594454226960/.




No comments: