Everyone has something they want to change. Employees want to change their bosses' mind and leaders want to transform organizations. Marketers want to change consumer behavior and sales people want to change the client's mind. Parents want to change what their kids are doing and spouses want to change their partner's behavior. Startups want to change industries and nonprofits want to change the world. But change is hard. We push and we prod, and we try to persuade, but often nothing happens. It's often like we didn't even do anything at all. And so the question we're going to ask today, is is there an easier way to change minds and incite action? Could there be a better way to drive change? Hi, I'm Jonah Berger, I'm a marketing professor at the Wharton School at the University of Pennsylvania. And I'm excited to tell you about some of the science for my recent book, The Catalyst: How to Change Anyone's Mind. We're going to talk about changing minds, inciting action and how we can transform organizations by understanding the science of change and how we can be better at changing anything. Before we start though, I'd like you to do two quick things for me. I'd like you to think for a moment about what you want to change. It could be your boss's mind. It could be an organization. It could be a client's mind, it could be your child's behavior. Write down at least one, if not two or three things that you want to change. And then, write down one additional thing for each. How have you tried to change these things already? Pause the video and write down both what you want to change, and how you've tried to change it, and then when you're done start us back up again. Thanks for writing that down. Now to help us understand why change is so hard, I want to start by talking about something called the status quo bias. And to help us understand the status quo bias, it's helpful to understand an issue I had with my phone. A few years ago, I had a problem with my phone. I'd had it for almost six years and I loved it. It had all the features that I wanted, it fit nicely in my pocket and it was generally a great device. But unfortunately it was running out of memory. All the accumulated pictures and videos, combined with increasing app sizes had consumed the available space. And initially, this is no big deal, right, all of us have some things on our phone we're not using and in my case, there were songs I never listened to, or apps I never used, so I got rid of them. Soon though, unused files became harder to find. Every time I wanted to take a new photo, I had to start by deleting an old one. Who should I care more about, my aunt Jan on her birthday or my puppy's first day in the snow? Friends suggested that I investigate buying a new phone, and so I did. The newer models had faster processors and an extra camera and lots of additional space. But they're almost 20% taller than my old phone and wider as well. It's hard to hold one and type at the same time. It was even harder to fit things in my pocket. Would I have said ahead of time that size was the most an attribute of my phone? No. In fact, you've had asked me I probably wouldn't have even thought of it myself. But it was enough to make me think twice about getting a new model. I didn't want a new phone, I didn't want a different phone, I wanted the same phone I had already, just updated slightly. Apple was supposed to release a smaller footprint version eventually, so why not give it a few more months. And so I did. But as I waited, my old phone started a slow and concerted death spiral. First, an ominous red dot appeared in the settings app. Apple had pushed a new operating system, but I was out of space. Then the airline apps need to be updated. But they require the new operating system. And so that meant no more mobile boarding passes and one more thing to worry about every week when I traveled. Like a prop plane whose engine's slowly choke off one by one, different features of the phone gradually disengaged. Yet through all this, I waited. Through one indignity after another, I stuck by my old phone. Finally, after almost missing a flight because I hadn't printed a boarding pass, I caved. I broke down, I called my phone company and I ordered a new phone. Now, you would think this was the end of the story right? I've got a new phone, it would arrive, I'd tear up on the package and I happily start using it. But that's actually not what happened. Because even after my phone arrived, I still didn't use it. I was so attached to my old phone that I didn't open up the new one for more than three months. Weeks went by as I held on to the old technology, all the while my old phone slowly decomposing but easy to grasp. Now, you might find the story funny or even ridiculous. But it's more common than you might think. New things are often better. Phones are faster and have more memory. Services and more comprehensive and deliver better results. Management strategies are more current and more effective. New ideas are better than old ones. People very simply should switch, but they don't. Because even though the new thing is technically better, even though it's higher quality, people still cling to the old. They follow the same processes and maintain the same courses of action. And while it's easy to attribute this to nostalgia, something subtler is at play. Every change has up sides and downsides. A new phone has better battery life, but a bigger footprint. A new power plant has fewer outages but costs more. New software saves money, but has to be integrated with the old system and takes a while to learn. And it turns out these advantages the upsides to change, and the disadvantages, the downsides, well, they're not weighted equally. Imagine, for example, I offered you a chance to win $100 on a coin flip. If the coin lands heads, you'd win $100 and if it lands tails you'd lose 100. Would you take that bet? Well think about it for a second. If you're like most people you probably say, no way. Sure, there's a chance of winning $100, but there's an equal chance of losing $100, so the potential gain doesn't worth the risk. I might as well stay put and do nothing. Indeed classical economics would agree with you. Calculate the expected value or the sum of all possible outcomes multiplied by the probability and the resulting number is 0. 50% chance of winning $100 is 50 bucks, 50% chance of losing a 100 means -50, and so adding them together nets 0. And if there's 0 as the expected value people should be indifferent to taking the bet or not and so, well, I won't do it. So, I'll solve that problem. Let me sweeten the deal for you just a little bit. Rather than winning $100 on heads make it $102. Same potential downside, same losing $100, but a potential upside that's larger. Now $102 rather than 100. Standard economics would say you should take that bet, right, the expected value is now positive, it's now $1. $1 isn't huge, but play that gamble 100 times and on average you should win $100. So expected value would say you should go for it. But would you? Would you be willing to risk losing $100 just for the chance of winning a 102. Probably not. In fact, I'd have to increase the upside significantly to get more than a couple takers. Because very simply, losses loom larger than gains. When deciding to take a bet, buy a new phone or make any change, the potential disadvantages are weighed more heavily than the potential advantages. Losing $100 feels worse than winning 100. Losing 100 even feels worse than winning $110. In fact, research in the space shows that the potential gains of doing something have to be over two times larger than the potential downsides to get people to take action. Chance of losing $100, the potential win has to be at least 200 before most people would take that bet. Whenever people think about changing, they compare new things to their current state, the status quo. And if the potential gains barely outweigh the potential losses, they don't budge. And so to overcome what's called loss aversion, the advantages have to be at least twice as good as the disadvantages. New software can't just be a little better, it has to be a lot better. A new approach can't just be slightly more effective, it has to be significantly more effective. If people have to give up something they like or lose things they value, the benefit, whether in terms of boosted efficiency, decreased cost, or some other positive change, has to be at least twice as big to make up for that loss. And while the advantages of new things are often salient, potential change agents, us, we tend to ignore the potential disadvantages or costs. Take something like a new router, for example. The monetary costs are easy to see, but there are several less obvious costs. The mental effort, for example, required to read reviews, compare attributes, and figure out which potential alternative is best. The time required to order a new device, install it and learn a new system. This does even include the potential cost of regret for making the wrong choice. And all of these costs, all these potential downsides, make it easier to stick with what was done before, even if it's not perfect. And that's exactly what happened with me and my phone. Sure, the new model was technologically better. It was faster and sharper and all those other things that new technology often is. But were the benefits twice as good as the costs? Not really. Switching to the new version required moving beyond what I had already. Giving up the smaller footprint of a phone that I knew and loved. And that potential loss, that downside, made it hard to switch.
