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Strange ReTales: No GST!

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Everybody’s decision making hinges on specific psychological levers. An important part of sales skill is identifying what levers someone has where, if you pull on them, they’re going to say “Yes” to the deal.

Those levers can vary greatly from one person to another, but they always involve someone’s need, whether they’re rational or irrational, spoken or unspoken, conscious, or unconscious.

And there may be more than one lever, and you may need to identify them and pull them in the correct order to get to Yes.

Not only that, but sometimes the levers in an individual’s decision making may be very strange indeed.

One of those very odd levers I’ve encountered is people’s attitude towards sales tax.

Some background for you non-Canadians: in 1991 the Canadian government instituted a national sales tax, called the Goods and Service Tax (or GST).

It was enormously controversial and politically unpopular. Initially a 7% tax on goods large and small, from a bag of candy to a meal in a restaurant, to a big-screen TV, later governments rolled it back to a 5% tax.

That rollback however did little to increase its popularity.

It was so unpopular, that consumers frequently say while haggling over a price “And I don’t want to pay the GST.”

In fact, it became a joke among my colleagues as we did impressions of various customers, a catchphrase becoming a punchline: “Two thousand, NO GST!”

So, while working out a package price it was pretty standard to factor in the total gross price, tax included.

Not only that, but retailer advertising departments soon learned that customers responded more favorably to sale event offers to “SAVE THE GST!” than to other percentage offers.

It sounds crazy, but print, radio and TV ads that promoted “SAVE THE GST!!!” and its 7% discount drove more customers into the store than offers of 10, 20, 30, 40, 50 percent off.

Psychology, see?

The takeaway here for readers who aren’t retailers is to keep your eyes open when dealing with your clients. The levers that will motivate them to buy might not be as obvious as you think.

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