Becoming a Master Dealmaker – Two Meta Models of Persuasion

I have a passion for persuasion. I think that everyone should know how to persuade ethically and effectively. This obsession has led me to study psychology, strategy, marketing, cognitive science, and anything related to persuasion and influence that I could get my hands on.

I have observed that there are two main models of persuasion that are in use today. These are more like meta models of persuasion since they encompass many little models under them.

The needs based model.

As the title suggests, the needs based model relies on us understanding the various needs of another person and designing our products and services to fulfill those needs. While seemingly simple in surface, the needs based model is the core behind almost any form of marketing and advertising today.

The basic idea behind this model is that people have wants and needs such as the Maslow hierarchy of needs and we are motivated to fulfill those needs. Marketers then direct their attention towards linking their product or service to a particular need.

Maslow’s list includes:

  1. Physiological needs, such as food, water, bodily comforts, and other individual biological needs.
  2. Safety needs, such as shelter and protection, free from worry about things like money, health, etc.
  3. Love/belonging needs, such as friendships, relationships, acceptance, family, intimacy, camaraderie, etc.
  4. Esteem needs, such as self-esteem, confidence, achievement, respect from others but also status, glory, reputation/fame, etc.
  5. Self-Actualization needs such as morality, creativity, spontaneity, lack of prejudice, effortlessness, achievement, problem solving, playfulness, etc.

Along with Maslow’s original list of needs, there other needs that are slightly more “negative” or darker/sinister in nature, far more secretive and powerful. They too are part of the human nature and cannot be ignored. In fact one book I read called them appropriately “hidden addictions” This list includes:

  • The 7 “deadly” sins/vices: Lust, Greed, Gluttony, Sloth, Wrath, Envy, Pride. All of them very powerful and very easily taken advantage of
  • Vanity
  • The need to be right instead of wrong
  • The need for a scapegoat
  • The need to know secrets that nobody else knows
  • The need for power (or a sense of power)
  • The desire to win (or not to lose)
  • Etc.

The basis of the needs based model is that you first determine what the other person’s most pressing need is and then you frame your offer in a way that gives them the hope that you can fulfill that need, without anyone directly stating the need. This is how scam artists usually take advantage of people.

The biases/shortcuts based model.

The shortcut/biases based model takes advantage of the brain’s inherent desire to preserve as much energy as possible and use heuristics to make decisions rather than think harder. The list of cognitive biases is HUGE!

By presenting an offer in ways that take advantage of these biases (such as for example the status quo bias or the confirmation bias) you can get someone to make a quick decision in your favor.

For example we tend to remember much better things in the beginning and things in the end and not so much the things in the middle, so if for example you start off the year working hard, you slack off in the middle but then you pick it up again toward the end of the year (when reviews are usually done) people will tend to remember more what you did last and thus give you a higher score.

Another very important example is the status quo bias where you tend to go with the default choice rather than weigh all the choices evenly. “Evil” websites and software developers for example can take advantage of this by leaving checked off options where you are charged a recurring fee, or where you inadvertently install programs you never intend to use.

The core distinction among the two models is customizability.

When you’re creating a product to target a very specific need or want, you HAVE to customize your pitch for the appropriate audience or else you won’t connect with them. (By the way this is also how you gain rapport with peopleā€¦.more on that on another post)

However when you’re using biases and shortcuts, since we all have pretty much the same biases, you can keep your pitch constant regardless of the audience you’re presenting to. This is the main idea behind a book called Pitch Anything by Oren Klaff. He focuses primarily on how you can frame your product in such a way that it will appeal to any audience without the need to vary it based on needs.

The most effective persuasion techniques combine both models for the biggest bang for your buck.

Implicit vs. Explicit Mental Models

There are two kinds of mental models, implicit and explicit. They are categorized based on the acquisition method (i.e. how did they end up in our mind)

Explicit Mental Models

Explicit models are the ones you learn from studying various disciplines such as math, physics, economics, etc. In my last post I talked about Charlie Munger and his mental models he uses to evaluate deals and make investment decisions.

He draws them out of various disciplines and then uses them in contexts where they weren’t necessarily built to be used. For example, my background is in computer science which teaches the principles of computing.

Taking that model and applying it to any electronics device has allowed me to fix a lot of non-computer gadgets. It’s a great model to use for that purpose, but it fails terribly when applied to human interactions. You’ll need another model for that.

Another good example is the supply and demand model from economics. It’s a wonderful model for understanding many facets of human behavior. It can be applied on a micro level – like one-to-one daily transactions between humans – and on a macro level – like the economy of a country.

Note: Both the above examples illustrate the limits and failure of models in general, something that was discussed previously.

These are both examples of explicit models, where you learn the model from an outside source and then you apply it to a situation where it works.

Implicit models are the ones that your mind creates out of various patterns it notices around it through the five senses. The mind is a pattern matching machine. It seeks out patterns in the randomness and tries to make sense of it by creating models. These are also known as generalizations or beliefs.

Implicit Mental Models

Implicit mental models are harder to detect because they work essentially behind the scenes, filtering and distorting reality to fit what we believe. Yes, in case you didn’t know it, when presented with evidence, humans don’t change their minds. Instead, they interpret the facts through their internal mental models, but this is a discussion for another day.

How do you pick up these implicit mental models? There are several ways. First it’s through our culture. Culture indoctrinates us without us even being aware of it. You don’t know it’s there, you don’t know why it’s there, you just assume that’s how things are supposed to be. In fact, many people are unaware of indoctrination effect their culture has until they leave their country and live abroad for a while.

Second it’s through media. This is impossible to escape; every show you watch, every magazine or newspaper article, every movie, every song has built in assumptions and ends up reinforcing the same mental models about reality over and over.

For example, it’s impossible to watch a romantic comedy nowadays without implicitly believing that you’re supposed to have some spark or chemistry with someone right off the bat in order to fall in love, which is then a prerequisite for a successful relationship and marriage. It’s only when you study the history of society that you understand that marriages in the past were often arranged for economical or political reasons.

Third it’s through your peer group. Even if you don’t try, if you hang out with a group of people long enough, you’ll eventually start to change and adapt your mental models to fit those of the leader of the group. This is done completely outside of your awareness, but the processes that occur in your mind (such as reframing and the change of meaning) are very powerful and can be utilized on purpose to upgrade your mind.

How do these models compare?

Of the two, implicit models are the ones that seem to be more deeply entrenched and more likely to be outside of awareness. I believe this is due to the nature of the acquisition method. If the model was installed outside of our awareness, it will tend to operate outside of our awareness and control (or regulate) our life as it on autopilot.

There are benefits to this of course. Since the brain can rely on a predetermined pattern, it doesn’t need to expend energy again to solve the same problem in the future. It writes neurological software and then sets it on autopilot. Unless you explicitly go in and look at the code (by becoming aware of the underlying model) and refactoring it.

Experiments performed on mice in a maze show that brain activity is very high the first time that the mouse runs through the maze to find the hidden piece of cheese. After that, subsequent trials show brain activity leveling off as mice learn the path to the cheese. (see The Power of Habit by Charles Duhig)

On the other hand, being deeply entrenched, implicit models are very difficult to modify when you’re trying to rid yourself of some unwanted pattern of thought or behavior. Explicit models on the other hand, can also get deeply entrenched – this depends a great deal on the emotional charge during the “installation” process – but in general tend to be easily updated, upgraded or removed.

If you’ve learned Newtonian physics and then you delve into general relativity, it’s easy to update your mental model which now becomes more enriched. The only trouble seems to be having the model you’ve learned from a book available to you in the moment when you need it to make a decision or solve a problem.

The power of context

One of the properties of mental models is the concept of a context or situation when or where a model is appropriate. A context can be something like work or home or with friends” You could have the most amazing set of explicit models “installed” in your mind but if they don’t permeate through to the right context, you’ll find yourself using sub-optimal response and behavior patterns.

For example, you could have a set of useful mental models that you use at work, with your colleagues, bosses, underlings, etc. You could be the best manager in the company; your employees could love you, your colleagues could be asking you for advice, but when you go home you find yourself yelling at your spouse or your children. In fact you could be a completely different person.

It’s all in the power of implicit and explicit models. You’re not a different person, you just have a different set of models you could be using implicitly for family life and the work life models don’t seem to permeate there. You’d have to first become aware of them and then put in some effort in order to get them “copied” over.