Our inner psychology tells us to be obedient to authority figures, even when obeying leads to our own downfall. Ignore them, be creative, and find new, high-value markets where you can tap into the new gold rush.
The Power of Authority
Our faith in authority figures leads to our falling into money traps. Studies have shown we are strongly inclined to follow the instructions of someone who looks like an expert. We will even substitute our judgement for those with the symbols of authority. Research into obedience to authority shows that we underestimate the extent to which the appearance of authority will influence us. (Social Psychology, 1999).
While the old scientific tests were mainly done with people in doctor’s coats, this influence also applies to political leaders, financial experts, or any authority figure, even celebrities with no financial standing. Do the gurus of internet marketing also come to mind?
So what can we do about it? How do we detach ourselves from this strong influence and work to our own goals? One way, that I mentioned in my book How to Control Your Financial Destiny, is to forget the herd’s sentiment and make your own decisions contrary to the crowd.
Contrary investing means you would invest when people are most fearful of investing (and thus get the lower prices), and withdraw and seek other markets when the herd is caught up in buying frenzy.
Contrary marketing would thus mean you are creating some unusual types of content, or using unusual mediums, that enriches the lives of others. I write about niche marketing for authors on here a lot.(more…)