Tuesday, May 19, 5-6pmAlia McKeePrincipal, Sea Change Strategies alia.mckee@seachangestrategies.com

Homer Leaves a Legacy:A Guide to Behav iora l Economics and Fundra i s ing

Alittlebitaboutme…

•Whatwasmostpressingforyouprofessionallypriortothepandemic?

•Hasthatchanged?Ifso,how?

Pleasechatin…

Behavioralwhat???

Thescienceofhowpeoplereallybehaveandmakedecisions

ATaleofTwoContrastingEconomicTheoriesRationalChoiceTheory BehavioralEconomics

Youareinthepersuasionbusiness.

BehavioralEconomics

FourPersuasionPrinciples

It’s98%aboutemotion

PrincipleOne

Confabulation

Socialpsychologistshaveawonderfulwordtodescribeourtendencytomakeemotionaldecisionsandthentorationalizethemafterthefact.Theycallitconfabulation.Theheartdecidesandthebrainjustifies.

TheElephant,theRiderandthePath

1. Motivatetheelephantwithemotion.

2. Directtheriderwithalittlerationalassurance.

3. Shapethepathwithaclearcalltoaction.

Kile Ozier’sStanford“ThinkAgain”AlumniFilms

1. Motivatetheelephantwithemotion:• Videoisfrompointofviewofastudentridinghisbikeonafamiliarroutetocampus.Immersestheaudiencewithnostalgia.

2. Directtheriderwitharationalassurance.• Tuitioncoversonlyabouthalfoftherealcostofundergraduateeducation.• NearlyhalfofallStanfordundergraduatesdependonneed-basedaidfromtheuniversity.

3. Shapethepathwithaclearcalltoaction.• DonatetoStanford.

Storyismosteffectivetoolforelicitingempathy&compassion

PrincipleTwo

Frankly, there isn'tanyone youcouldn't learn to love once you'veheardtheir

story.

Empathy,Neurochemistry,Story,Giving

WhyStory?

• Cortisol->Getsattention• Oxytocin->Increasesempathy

DNAofastory

• Relatableprotagonist• Desire• Conflict• Smallstory/Significantsaga

Doyouwanttoplayagame?

DNAofStory:OneChatintherelatableprotagonist

ROSE!

• Chatin:Whyissherelatable?

DNAofStory:TwoChatinherdesire

JACK+ESCAPINGHERCLASS&LIVINGAFULFILLINGLIFE

DNAofStory:ThreeChatinsomeconflictsshefaced

DNAofStory:FourSmallstory/significantsaga

Socialnorms

PrincipleThree

MESSAGEONE:“Reuseyourtoweltosavetheenvironment.”

MESSAGETWO:“Amajorityofguestsinthishotelhavereusedtheirtowels.Jointhemandhelpsavetheenvironment.

MESSAGETHREE:“Amajorityofguestsinthisroomhavereusedtheirtowels.Jointhemandhelpsavetheenvironment.”

MESSAGETWO:18%moreeffectivethanthefirstmessage.

MESSAGETHREE:33%moreeffectivethanthefirstmessage.

SocialNormMessagingYou’veSeen

SocialNormMessagingYou’veSeen

Recordvotingturnoutisexpected!

SocialNormMessagingYou’veSeen

SocialNormMessagingYou’veSeen

Valueistricky

PrincipleFour

ValueTruthOne

Noonereallyknowswhatanythingshouldcost.

Anchor

$11,000$20,000$2.9million

ValueTruthTwo

Marketnormstrumpsocialnorms

Marketnorms

ValueTruthThree

Whenitcomestoproblems,thebiggerthenumbers,thesmallerourconcern

“IfIlookatthemass,Iwillneveract.IfIlookattheone,Iwill.”

PrinciplesReview&Questions

1. 98%emotion2. Storyelicitsemotions3. Socialnorms4. Valueistricky1. Anchoring2. Marketnorms3. Small,notbig

Questions…