Written by Sean McPheat | 
Cognitive biases in sales can be the difference between closing a deal and losing it!
These subconscious influences affect both buyers and sellers, shaping decisions in ways that aren’t always rational. By understanding and addressing these biases, sales professionals can sharpen their tactics and improve outcomes.
Partnering with a sales training company that recognises the importance of psychology in sales can give your team the edge it needs to succeed in today’s competitive market.
Understanding cognitive biases is key to this advantage, which is why we’ll talk you through what these biases mean in sales and how you can effectively manage them to boost your success.
Here’s how the Cambridge Dictionary describes cognitive bias: “the way a particular person understands events, facts, and other people, which is based on their own particular set of beliefs and experiences and may not be reasonable or accurate.”
Cognitive biases are mental shortcuts or tendencies that affect how people perceive, process, and recall information. The are often based upon the twin false assumptions:
They can also be based upon prejudicial assumptions about other cultures, age groups, genders, or any group of people we incorrectly assume share certain characteristics.
In sales, these biases can distort judgement and decision-making, leading to missed opportunities or ineffective strategies.
Understanding these biases is crucial for sales professionals who want to optimise their approaches and increase their success rates.
Cognitive biases are systematic patterns of deviation from rationality in judgement. Here are some typical examples of statements that might reveal a cognitive bias:
The salesperson is making two potentially false assumptions based on their notions of how a married couple work. Firstly, that the husband may know more than the wife about a product, and secondly, that the husband is a more competent decision-maker.
The bias here is an inference from a small number of recent cases to a general principle. The salesperson may simply have had three recent calls from customers who all felt the same way about an aspect of their product.
This is an example of hindsight bias: the tendency to ascribe more predictability to past events than existed in the moment.
Here’s an example of the “halo effect” where we ascribe goodness to that which we find beautiful. This salesperson has been won over by a customer who may simply have been cunningly manipulating them.
As you can see, there are a host of diverse ways in which our rational minds can be disrupted by false assumptions, many of them deriving from primitive parts of our brains that operate more on instinct than intelligence.
These biases can lead individuals to make decisions based on preconceived notions, emotions, or previous experiences rather than objective analysis.
In sales, these biases can influence both the buyer and the seller, often in subtle and unexpected ways.
Sales psychology explores the underlying mental processes that drive purchasing decisions. It makes it easier to understand a buyer’s true motivations, and to find an honest way to express a product or service’s benefits in a way that reaches an audience.
Salespeople can then navigate these distorting biases and correct course to avoid making any foolish mistakes or adopting unsuccessful strategies. This discipline helps salespeople understand and improve their own performance, while guarding against individual performance weak spots.
In short, sales psychology helps in crafting messages, building relationships, and ultimately closing deals more effectively.
Understanding the common cognitive biases that impact your sales volume can empower you to adjust your approach, align your messaging, and close more deals.
Here are the top six cognitive biases that may affect a salesperson’s performance:
Recognising when and how biases appear during sales interactions is crucial.
The key moment to look out for is when you are filling in information gaps with assumptions. If as a salesperson, you have the thought “I’m not sure, but I assume…” you are probably in considerable danger of cognitive bias.
In short, if you lack information, try to fill it with researched answers to important questions, rather than an “educated guess.”
Learn the common biases and identify the triggers that call them into being. Remember the times when your assumptions let you down, and you’ll be more guarded against such biases in future.
Awareness of these biases allows sales professionals to adjust their techniques and avoid pitfalls that could derail a deal. Biases might reveal themselves through selective attention, framing effects, or confirmation bias, among other common assumptions.
Selective attention is focusing on one element of a sales relationship, such as a single pain point, while ignoring others (for instance, that the buyer may not be the budget holder).
Framing effects are the emotional valency we place around a statement. For instance, if you are selling a piece of productivity software you might say:
A: “We’ve all been there: tasks are piling up; you have 1000 unopened emails and there’s a deadline looming; our product can save you” (negative framing) OR
B: “On average, our users see a 23% gain in productivity and a 17% accuracy improvement within the first month of implementation” (positive framing).
Depending on your buyer’s personality, either approach might work, but you need to identify whether they are loss-orientated or gain-orientated before you choose a framing. If you tend to go for one strategy over another, regardless of your buyer’s psychology, you’re acting on your own cognitive bias.
In short, study and learn the various biases, and identify them when they pop up.
Buyer psychology is heavily influenced by cognitive biases.
For example, a buyer might overvalue a product due to the anchoring effect or make an impulsive purchase driven by the scarcity bias.
An unscrupulous salesperson might be inclined to leverage these cognitive biases to make easy sales. However, this is often a mistake, leading to buyer regret, requests for refunds, and negative feedback. You want clients to feel happy with their decisions, to talk well of your brand, and to come back for more.
Understanding these influences upon buyers can help sales professionals guide buyers towards better, more informed decisions.
Overcoming cognitive biases requires deliberate strategies that account for these subconscious influences. By implementing the following four tactics, sales professionals can counteract biases and ensure more rational decision-making.
Helping clients recognise their own biases can lead to more transparent and effective communication.
Example: “It’s had a total UX redesign, but don’t be wowed by how beautiful it looks. Let me show you the practical improvements and new features we’ve made since the last release.”
(avoiding the halo effect to show your client the real value your product offers)
This can involve providing data, comparisons, and clear explanations to counteract common biases like anchoring or confirmation bias.
Pre-mortem analysis involves anticipating potential objections and biases before they arise.
Example: “I know you’ve previously been a Mac person, and you might not know much about PC builds and how flexible they are but let me show you.”
(dodging confirmation bias in your buyer by addressing their prejudices and preferences)
This proactive approach can help in crafting responses that address these biases head-on.
Bringing in diverse perspectives within your sales team can help mitigate the biases that may arise from a homogeneous groupthink.
Example: Gender balancing your sales team can help address the more diverse buyers you’ll encounter.
Diverse backgrounds and viewpoints can challenge assumptions and lead to more innovative solutions.
The way information is presented can significantly influence decision-making.
Example: Try A/B testing different framings among your sales team and analysing outcomes. You might assume a negative framing works best but discover that most buyers prefer a benefit-based approach.
By framing your sales pitch differently or reframing objections, you can steer the conversation in a direction that reduces the impact of biases.
Incorporating practical sales tactics into your routine can further help in reducing the effects of cognitive biases. Consider these strategies to ensure a more balanced and fair sales process.
Active listening ensures that you fully understand the client’s needs and concerns before responding. This approach minimises the risk of falling prey to biases such as selective perception or the halo effect.
“So, what I’m hearing is that your main concern is reducing overhead costs while still maintaining product quality. Did I get that right? Let’s explore some solutions that should address your needs.”
By asking the right questions, you can uncover hidden biases and address them directly. This technique encourages clients to think critically about their decisions, leading to more rational outcomes.
“Can you tell me more about why this feature is less important to you? What are your main priorities if this is less crucial?”
Social proof leverages the psychological bias that people tend to follow the actions of others.
“Many of our clients in your industry, like [Client A] and [Client B], have seen significant ROI within the first quarter of implementing this solution. There’s every reason to believe you’ll see the same kind of success.”
Highlighting case studies, testimonials, and endorsements can help sway decisions by aligning with the client’s biases towards conformity and safety.
Understanding the emotional landscape of your client can help in anticipating biases.
“Making a change like this can be daunting, especially when it impacts your entire team. Let’s walk through how this will affect your day-to-day operations and see if we can make the transition as smooth as possible for everyone.”
Empathy mapping allows you to see the world from your client’s perspective, helping you address their subconscious influences more effectively.
Consistency in your messaging and actions helps build trust, which can counteract biases related to distrust or scepticism.
“As we discussed in our previous meetings, our approach has always centred on long-term value rather than short-term gains. Every recommendation I’ve made aligns with that principle, and our team is committed to maintaining this approach throughout our partnership.”
Clients are more likely to make decisions in your favour when they perceive you as reliable and consistent.
Behavioural economics combines insights from psychology and economics to explain how people make decisions. In sales, applying principles of behavioural economics can lead to more effective strategies.
For instance, understanding the concept of loss aversion can help in crafting offers that clients perceive as too good to miss.
Loss aversion is a version of FOMO (fear of missing out) that occurs when people see others benefiting from a great deal and want to be a part of it. People often place greater emphasis on potential losses than actual wins.
Understanding behavioural economics helps leverage cognitive biases in buyers, which still delivers excellent value and earning their trust.
There have been some insightful books written on behavioural economics, including the following:
Sales professionals can use psychological principles to better understand and influence buyer behaviour.
Techniques such as using scarcity to create urgency, employing reciprocity to build goodwill, and using authority to establish credibility can all enhance sales outcomes.
To use sales psychology effectively, it’s important to integrate psychological insights into every stage of the sales process. By doing so, you can make your approach more persuasive and better aligned with the client’s subconscious drivers.
In the initial stages of engagement, consider using the principle of reciprocity. Offering something of value upfront—such as a free consultation or valuable industry insights—can create a sense of obligation in the client. This often leads them to reciprocate by seriously considering your product or service.
As you move into the negotiation phase, the scarcity principle becomes a powerful tool. Emphasising the limited availability of a product or a time-sensitive offer taps into the client’s fear of missing out (FOMO), driving them to make a quicker decision.
Throughout the entire sales process, maintaining consistency in messaging is crucial. Consistent communication reinforces trust, making the client feel more secure in their decision to move forward with you.
This combination of psychological tactics helps in building stronger client relationships and ultimately leads to more effective deal closures.
Rather than simply trying to overcome cognitive biases, sales professionals can strategically apply these biases to positively influence buyer decisions.
Understanding biases like the decoy effect or the mere exposure effect allows you to tailor your sales tactics in a way that guides buyers towards favourable outcomes.
For example, the decoy effect can be used by presenting three pricing options: a high-priced option, a low-priced option, and a middle option that is close in price to the high one but significantly better in value. This setup often makes the middle option appear more attractive, steering buyers towards it.
Similarly, the mere exposure effect can be used by consistently exposing the client to your brand or product in a positive light. This could be through follow-up emails, retargeted ads, or a strong social media presence.
Repeated exposure makes the product feel more familiar and trusted, increasing the likelihood that the buyer will choose it.
By skilfully applying these cognitive biases, you can subtly influence buyer behaviour, leading to more favourable outcomes without overtly pressuring the client.
Understanding and managing cognitive biases in sales is essential for any professional looking to optimise their strategies and close more deals.
By using the principles of sales psychology and behavioural economics, you can not only overcome these biases but also use them to your advantage.
Ready to take your sales to the next level?
Whether you’re looking to refine your team’s approach through Sales Training Courses, elevate your own sales leadership with Sales Management Training, or identify areas for improvement with Sales Assessment and Sales Personality Testing, identifying and addressing cognitive biases will be a major part of driving success.
Sean McPheat
Managing Director
MTD Sales Training
Updated on: 20 September, 2024
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