This article is the fourth in the series of explaining wealth. The first was the scientific explanation, the second was the spiritual one and the third the economic. This article will tackle the psychological issues surrounding wealth and its creation.
You might be thinking that it is somewhat unclear whose psychology we are talking about. Every transaction must always have two facets. That is, the buyer and the seller. We’ll talk about both.
The Psychology of the Buyer
It’s not very hard to ascertain this because the psychology is driven by well defined motives such as desire and need. These are always the most prevalent ones. Buyers will never purchase a product because they want to make the seller rich. The reason is always a selfish one but this is not meant to be a derogatory remark. It must be this way because the buyer is parting with hard-earned cash. If we go down the scale of motives we come across the concept of prestige. The practical function of a Rolex watch is no better than that of a watch that costs a fraction of the price. However, a Rolex watch has another, more sinister function. It screams out the status of the owner. But this is fine if that’s what you’re after. It applies to almost all products that are by their very nature much more expensive than cheap equivalents. If you dig a little deeper, you might find that there are other underlying incentives for buying a particular product but they are more to do with the buyer than the product. You might buy something to show off to your neighbour or to your colleagues. It really doesn’t matter because the number of purchases resulting from desire and need still far outweigh all others put together.
Often it is very easy to see through the psychology that advertisers use to entice us to buy their product as opposed to another. But this is usually in markets saturated with different products with the same function such as different makes of car, perfume, clothes, food, electrical goods and so on. It makes it hugely difficult to enter such markets because they are driven by very large investments and revenue.
So where does that leave the humble beginner who wishes to flood the market with a particular product. It is definitely possible to do because many people have done it and are doing it. Needless to say your particular product still has to exhibit and excel in one or more of the criteria outlined in article 3 of this series.
If we assume that all buyer motives other than desire and need are negligible, we can roughly divide all products into a 50:50 ratio between these two areas. I will commit myself and say that there is probably a better chance of being able to succeed in any major way in the market of desire than need though the probability increases rapidly if you have access to a large investment capital. The simple reason is that you can actually create desire but you can’t create need because needs are mainly for survival only and are few in number. In fact, you can boil them down to three industry divisions. Food, clothing and shelter. All else is probably more a desire than need.
To demonstrate the veracity of this statement, that you can create desire, let’s assume you have a new product X that you wish to sell. You are sure that it meets the criteria outlined in the article preceding this one. How do you create the desire. There are many past examples but here are seven:
1. Child’s yoyo. (not so long ago every child had one)
2. Lights on the soles of trainers
3. Cameras on mobile phones
4. Key ring lasers
5. Scooby do’s (coloured plastic strings for children to weave into plats)
6. Ipods
7. Rubik’s cube
8. The stepometer
All of the above have one glaring attribute in common. The desire came into existence only when the product did. It is that indefinable quality in a product that influences a buyer in such a way as to create the desire to have it. There may be other products that possess the very same function but not the way it is conveyed or delivered by these ones. Desire has exponential properties in as much as it actually grows as the number of people that buy the product. The trick is to come up with a product that is capable of creating the desire. For that, we need to examine the psychology of the seller.
The Psychology of the Seller
Ultimately the motive behind selling anything is to make money but this must not be the overbearing reason. I’m not saying it is impossible to make money with products or services that are out to do nothing but make money. What I am saying is that the likelihood of creating wealth increases dramatically if the following principles are adhered to. So, just as the reason for a buyer to purchase something is ultimately a selfish one, the opposite must be true of the seller. That is, if you want the product to become a best seller, your motive must hinge firmly on the side of the potential buyer and not your bank balance. You must ask yourself the following three
fundamental questions:
1. Who will buy the product?
2. What benefit will it bring them?
3. Will people want to buy it if they see others who have it?
A successful product will attract the following answers:
1. A large subsection of the population such as children, teenagers, adults 30-50, senior citizens, men only or women only. If the product is for general purpose, the entire population may be included but such new products are usually few and far in between.
2. Since we’re in the desire market this will be centred around the capacity of your product to entertain or make life a easier or healthier.
3. If people encounter evidence of 2, 3 will follow naturally.
The third is really the key to it all because you can always sell a few products but whether it catches or not depends entirely on the answer to question 3. The best and the most powerful publicity is word of mouth. The second is seeing another person with the product.
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