“Unbelievable! This house is perfect for them yet they still want to see more homes!” These were the clearly frustrated comments a real estate agent recently made to me while trying to sell a property to a new couple. She had been doing research for weeks to find them the perfect property for their needs and since they were in town for limited time, she wanted to make the most of it and took them to the one house that best met all of their needs. So, did they end up buying when they saw it? No. Why? The problem was the buyers didn’t yet know it was the perfect house for them because they couldn’t answer a simple question in their own minds: Compared to what?

What the real estate agent discovered is a lesson everybody in sales must ultimately learn in order to be truly successful and it all has to do with something called THE CONTRAST EFFECT (or Contrast Principle). The Contrast Effect states that our perceptions of cost, size, worth, value, appearance, etc. are related to and effected by the exposure and stimulus received from comparable others we experience both before and after. And it is the comparable others that ultimately allow us to “know” if what we are buying is a “good buy” or not.

For example, take a look at the adjacent picture of the circles and ask yourself this simple question: Which of the two black inner circles is larger? Now stop and take a good look before you answer… Now I’ll give you the answer…neither is larger than the other – they are both the same size. What your mind is telling you however is something completely different. Why? Because it is the contrasting circles that surround each black circle that make the one on the left appear larger relative to the one on the right. In sales, this same principle takes place in the mind of your buyers which is why you MUST learn how to both understand and take advantage of this psychological state of buying better than your competition.

Now back to the real estate agents buying story. Even though she was convinced that the home she presented her buyers was the best one for them based on the inventory that she knows and compares it to each day, her buyers had two main problems. First, they were not in a position where they themselves could not make that same competitive determination and second, are they willing to trust a real estate agent to solely make that decision for them in what for most of us is the largest financial decision we will make in our lives? So here is how to better handle these sales situations:

First off, you need to let the buyers know that because you are uniquely in a position to do the research and know the customer’s needs better than anyone else, you are making the best use of their time by coming up with the best options for them to consider. Second, despite knowing that the perfect option (house) awaited them, you should select at least two more alternatives (homes) for them to consider that day – preferably one that was of lower cost and one higher and both of which in comparison to the perfect product (home) would have appeared of lesser value. In essence, you should be surrounding your inner circle (the perfect home) with smaller circles that in comparison made your perfect product (home) stand out and appear bigger (higher value) to the buyer. And when salespeople do this for their buyers, their close rates increase and productivity improves in selling nearly any product or service.

Using the contrast principle can also be used in nearly every aspect of our lives and in business including when we:

  • Negotiate for better deals
  • Buy & sell products and services
  • When we hire and/or look for job
  • Etc. 



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