That's the charismatic Steve Jobs that dazzled us with new innovations and groundbreaking tech during keynotes at Apple. But Steve was able to influence people decades and decades before that. Probably the first notable example of this is an old school picture with Steve and his classmates. The picture was taken when Steve was just a young boy. Now in this picture, all but one student is wearing a Hawaiian shirt. It was a Hawaiian shirt themed day at school, so all the kids brought in a shirt to wear. You might expect Steve to be the odd one out. He's not by the way, he's wearing a Hawaiian shirt. But the story is that Steve had forgot his shirt. The only reason he's wearing one is because he persuaded a friend to swap shirts with him. His friend is now the odd one out. So Steve knew how to get his way. From a young age. He knew how to convince people. Now, we don't know what tactic he used back then to convince his friend, but it's an early sign that Steve Jobs has a knack for persuasion and he'd use this skill for good and for bad. Steve Jobs met Steve Wozniak back in high school in 1968. The two of them would stay close friends for years, eventually co founding Apple together. Steve Wozniak, or Woz as he's known, was, and of course is an incredible engineer. One of the first projects Steve and Woz worked on was, well, mischievous. They loved playing pranks on strangers and started to build contraptions to take their pranks to the next level. Their favourite prank involved a custom built TV jammer put together by Woz. It's essentially a TV remote that could cut the signal to any TV and turn it back on with the click of a button. Stephen Woz would creep up to a stranger's house, peek through the front window and then they'd turn on the jammer and watch the family get frustrated. They keep turning the jammer on and off. Annoying, usually the dad to no end. This was pretty funny to them and I can imagine why. But Steve Jobs had an even better idea. He'd come up with a strategy to make it even funnier. He'd only turn the signal back on once the dad was standing next to the TV with his hand on the aerial. After doing this a few times, it made the father believe that the only way the TV would operate was if the dad stood next to the tv. With his hand on the aerial, Stephen was would leave in fits of laughter, wondering how long the dad would stay there with his hand on the aerial. It's a funny and I think fairly harmless prank. And it shows again that Steve understood the basic principles of human behaviour. The obvious principle here is the principle of conditioning. Steve is building a behaviour in someone through repeat conditioning over time. I think it's the earliest example I could find of Steve using a psychological principle to influence someone. And it's something that he would continue to do throughout his career, not always through conditioning, but through other psychological principles that influence and persuade. The next example comes later on in his life. It's with another Stephen was invention. See, the two stayed close friends in high school during that time. Wozniak designed what he called the blue box. The blue box generates sounds to manipulate the telephone network and make free long distance calls. See, this is back in the day when telephone calls played a sound to make the right connection. Play the right sound and you'll be able to make that call without having to pay the hefty fees at the time. Now, obviously this is totally illegal, but it's also a fun and potentially profitable way for the two high schoolers to make money. Was built the blue box and Steve, well, he was in charge of selling it. Now, put yourself in Steve's shoes. You're a senior high schooler, just 16 years old. How would you sell the blue box? Now, if it was me, I'd be at a bit of a loss. I guess I'd go speak to my friends, start telling them what the product is, what the benefits are. Maybe I'd tell them how much they'd save and ask them if they want to buy. I doubt I'd think of anything smarter than that. But Steve isn't like the rest of us. He intuitively used a psychological principle called social proof. Social proof is a principle that affects all of us. It means that we follow the actions of others. It's why when we know something is a best seller or most popular, we're more likely to use it and more likely to buy it. It's an evolutionary trait developed tens of thousands of years ago to keep us alive. If a bunch of cavemen were running out of a cave, you wouldn't go in that cave. You'd follow the actions of others. Social proof is used today in marketing. Richard Shotton, a marketing psychologist, added a best selling sign to a beer in a London pub and increased its sales by 2.5 times. However, social proof is notoriously hard to Use for products that aren't popular. This is a problem for Steve. He can't say the blue box is the best seller because no one has bought it. So Steve uses social proof in a different way. What he did is he went into the dorms of other seniors at high school, and he'd say, is George here? Now, the seniors would often say, no, because there was no one called George there. They would say, no, why? And Steve Jobs would say, ah, George was interested in buying the blue box. No problem, I'll come back later. Now, in most cases, before Steve could leave, the seniors would stop him and ask him, what was the blue box? Steve would then start his pitch, and in most cases, he would get a sale. This is a genius tactic, one that some of the best salespeople use today. Now, obviously, George doesn't exist, but that doesn't matter. Merely suggesting that someone is interested in buying your product will pique the interest of others. What's impressive is that Steve intuitively knew this at just 16 years old. It takes some salespeople decades to discover a tactic like this. Steve knew how to persuade and manipulate people at a young age. He might not have known he was using social proof or conditioning, but he knew what worked. Let's fast forward a few years. After one semester at college, Steve Jobs dropped out. It wasn't for him. He went back to his parents and he needed a job. But the story behind how Steve Jobs got his first job is another example of his persuasion tactics, and it's one that he continues to use time and time again in his career. He'd read an article about the company Atari, and the article spoke about what a wonderful place it was to work. The staff there were laid back. They were building exciting new video games. So Steve said to himself, I'm getting a job there. Problem is, there were no job openings with Atari at the time. But this doesn't bother Steve. He decides he'll get a job there anyway. So he goes to the office of Atari and refuses to leave the lobby until someone at the company would interview him. Remember, at this stage of his career, he is a complete unknown. He's dropped out of college, and yet he has this huge confidence in himself that he'll get a job. Now, they tell him to leave the lobby. They tell him no one will interview him, but he doesn't. He sticks around and stays in the lobby. Steve here is using sunk costs to prove his worth. Now, you might think that sunk costs affect you as an individual and not those around you. See, sunk costs is the idea that the more money or time or effort you spend on something, the more you'll value it. But it's a risky tactic because it works the other way too. If you see someone sinking time or money or effort into something, you'll value that thing highly too. For example, if you know someone has spent 10 years painting a watercolour, you'll value it much more than if you knew it only took 10 minutes. It links with the endowment effect and labour illusion, other principles we've spoken about on the show. Steve's showcasing his own sunk costs. Here. He's spending hours in the lobby quietly waiting for an interview, sinking all his time and arguably reputation into this makes the folks at Atari value him a little bit more. It's a bit like a hunger strike. The longer someone goes on strike for, the more we value and pay attention to their cause. I should highlight though, this is a really risky tactic. It only works if you have strengths to back it up. Sunk costs might get you an interview, but you'll be held to a much higher standard than a normal interviewee. And if you don't have the skills to back it, you'll be disliked even more. Arguably, there's a study by Elliot Aronson that highlights this. He filmed an actor answering quiz questions correctly. The actor got 90% of them right, and then the actor spilt coffee down himself, appearing clumsy and showcasing a weakness. What's interesting is people liked the actor more if he spilt coffee down himself. Matching a weakness, say, clumsiness with a strength. In this case, intelligence, made the actor more likable. But in another variant of the experiment, when the actor got most of the quiz questions wrong and was seen as stupid and then spilled coffee down himself, he was disliked even more than if he hadn't spilled the coffee. What this tells us is that if you showcase a weakness and a strength, you'll be liked more than if you just showcase strengths. However, if you showcase a weakness and and another weakness, you'll be heavily disliked than if you just showed one weakness. So Steve, he can get away with this. He's showcasing a weakness, which is his stubbornness and inability to say no while waiting in the lobby. But he can match it with a strength. He comes across extremely knowledgeable in the interview and gets a job. He realizes that he can manipulate people this way by sinking hours into contacting them and then dazzling them with his knowledge. And he uses this same tactic of sunk costs multiple times in his career. Later on at Apple, he desperately wanted a world renowned marketing Agency to come aboard and create the 1984 ad for Apple. Apple was too small a client. It didn't work with companies of that size. So Steve called the head of the agency dozens of times every day for a week, even on weekends, until he finally agreed. Sunk costs made the head of the agency pay attention. Steve uses the same tactic when recruiting the famous logo designer Paul Rand from IBM to design a logo for his newest company. Next. Now, IBM wouldn't let this logo designer Paul Rand leave to join Steve, and most people wouldn't fight that. He's at IBM after all. But Steve isn't most people. He called the IBM vice chairman three days in a row before he eventually agreed. Steve is not afraid to showcase his commitment to sink time and reputation into a task to get what he wants. Most people, if they did this, would come across as petulant, stubborn and childish. But Steve gets away with it because he's got other strengths that make up for it. It's a smart tactic that Steve uses to manipulate people, but one that you and I probably couldn't replicate, as we haven't got Steve's charisma or raw intelligence anyway. Eventually, Steve decides he wants to leave Atari. After all that work getting a job there, he's become a bit of a hippie at the time and decides to go to India to find his guru. Seriously, that's not a joke. That is what Steve decides to do. However, Steve has no money for his flight to India. He's skint. The job doesn't pay very well and he hasn't saved any cash. Most of us would get a second job to save up, but not Steve. He decides to persuade Atari, his employers, into paying for his trip to India. He does this by using what I think is his favourite psychological anchoring. Anchoring is the idea that we are heavily influenced by the initial piece of information we see. Imagine you look at a menu at a restaurant and you see that most bottles of wine are priced at £40. You'll think that a £30 bottle of wine seems like a good deal. However, if you went into another restaurant where most of the bottles are priced at 20 pounds a bottle, then a 30 pound bottle, well, that will seem overpriced. We are anchored by the information presented around the offer, and it changes our perception and our decisions. Steve uses variations of the anchoring bias dozens of times during his career, but one of the first examples I noted was how he left Atari. So he simply told his should pay for my flight to India. I've been a tremendous employee I've outperformed my peers. I've done everything you've asked of me, so buy me a flight to India now. Unsurprisingly, the Atari bosses laughed at him. He was leaving. Why on earth would they pay for a flight for him to go on holiday? They've never done this for anyone else, especially not a junior employee like him. But it crucially set an anchor, something that Steve could use to negotiate down from. Steve was able to say, okay, if you can't get me that flight, how about you send me to Munich? I'll do a bit of work for the German branch of Atari and then I'll go to India after that. Now, this appears to be a much more reasonable request. And Atari ultimately agreed to it. They thought, look, of course we can't send him to India, but Munich's much more reasonable, it's a bit cheaper, and if he does a bit of work for us, then why don't we do it? It's classic anchoring in action. He frames the request in this way to make it seem much more reasonable. If he'd asked to be sent to Munich outright, Atari probably would have disagreed. But through the frame of sending him to India, the ask to go to Munich seems much more sensible. Steve uses this same tactic throughout his career. In fact, he used it to convince Woz to drop everything and co found Apple with him. Initially, Woz was dead against starting a business. He simply refused. And Steve had a really hard time convincing him to co found Apple. That's until Steve Jobs used anchoring to reframe the decision to convince Woz. Steve Jobs said, we could lose all our money, but we'd still have a company. That that one line that convinced was, according to him, that's what changed his mind. Why did it change his mind? Well, I think it's because it's a smart bit of anchoring, because he eliminates the objections. Steve Jobs is agreeing that, you know, Apple might not work, they might go bankrupt, but they'd have a company. They would have built something that was worth something. That's the anchor that convinced Woz to join Steve and co found Apple. And much later in Steve Jobs career, he used again the same tactic, but this time with Pixar. Jobs was CEO of Pixar at the time. That's the Pixar behind the world's most successful animation films, like Up, Bug's Life, Wall E. You know who Pixar are. But before Pixar had created any of those films, they solely worked on smaller shorts that hardly drew in any revenue. In fact, the company was really struggling at the time. However, they had one incredibly talented animator on staff. His name was John Lasseter. He's probably the best animator of all time. He creates a short film for Pixar called Tin toy. It cost 300,000 to produce and didn't make anything in return, but it won an Oscar for Best Short Film. It was the first Oscar win for Pixar and the first ever CGI film to win an Oscar. Obviously John Lasseter was good, really good. And Disney, who had no connection to Pixar at this time, Disney saw how talented John was. So Disney tried to hire him. They offered him a huge pay rise, much more responsibility. But John says no, he's not interested. He's happy at Pixar. Most CEOs would be happy to hear this. They'd be delighted. They would say, great news, John, thanks for agreeing to stay. But not Steve Jobs. He saw an opportunity to anchor. He tells Disney they can work with John, but only if they help Pixar create a feature length film. See, Pixar didn't have anywhere near enough funding, equipment or manpower to create a feature film, but Disney, Disney did. So Steve used John as his anchor to get what he wanted. Steve suggests that Disney and Pixar co produce the first ever animated feature length film and John Lasseter would direct and write it. John would stay on the Pixar staff, but Disney and Pixar would split the profits. Disney agreed. Of course they couldn't turn down the offer to work with John. And even though they'd be helping a rival, they thought it was worthwhile. And that film, well that was Toy Story, one of the most successful movies of all time, generating $362 million worldwide, making it the second highest grossing film of the year and also winning three Oscars. And it wouldn't have happened unless Steve Jobs had used that opportunity to anchor. Disney wouldn't have agreed to co create a feature film with Arrival if Steve had just asked. But by using John as an anchor, by saying, you can't poach John, but you can work with him if you help us out, Steve Jobs was able to get what he wanted. As I mentioned, Steve used anchoring extensively in his career, especially during his keynote presentations for Apple. I'll dig into that in part two of this show, which will come out on Nudge in a week or so, so make sure you're subscribed if you don't want to miss that. But for now let's focus on some of the other Tactics Steve has used to convince and arguably manipulate people while building Apple. Now, one of the things all great CEOs seem to have in common is the ability to reframe things. To take a problem, explain it in a slightly different way to help people discover a solution. Elon Musk does this a lot. He reframes sending satellites into space for commercial gain as a way to save humanity by building a future settlement on Mars. He reframes expensive electric cars as a chance to save the environment and signal your commitment to stopping climate change. But Elon doesn't come close to Steve Jobs when it comes to reframing. Jobs was the master of reframing. He would take a problem that seemed impossible and help someone solve it by reframing the problem in a different way. There's one brilliant example of this. When Steve was overseeing the creation of the Mac os, the engineer Larry Kenyon had done everything he could to make the Mac boot up as quickly as possible. He'd spent months working on this boot up startup sequence and had finally presented the boot up sequence to Steve. But Steve wasn't happy. He wanted it to boot up even faster. Now remember, Steve has no reason to believe it could boot up faster. Steve was not an engineer. He didn't know how to make the Mac turn on faster. He just believed it could. So Steve used reframing to reframe the problem for Larry Kenyon. Steve described the problem in a different way that persuaded Larry to dig even deeper and find a better solution. He asked Larry, if you could save a person's life, would you find a way to shave 10 seconds off the boot up time? Larry Kenyon said, wow, yeah, I would do it if it would actually save someone's life. I could probably find a way. And then Steve pulled over a whiteboard and he started writing. He did some calculations. He showed that if 5 million people use the Mac and it takes 10 seconds longer to boot up, that adds 300 million hours of waiting time per year. That equals 100 lifetimes each year. This is classic reframing. Increasing the boot up time doesn't remove a tiny unimportant wage. No, it saves 100 lifetimes worth of waiting each year. He said to Larry, this won't save one life. If you do it, it'll save 100 every year. It might be an annoying thing to hear as an engineer, but it is certainly motivating. A few weeks later, Larry Kenyon presented the new boot up sequence to Steve and it was 28 seconds faster than before. Now, Steve was happy Steve comes back to reframing time and time again when he's trying to motivate his team. He used reframing again during the development of the first ipod. When the team started the project, he kept repeating the same point. He said, I have to be able to find a song that I want in three clicks or less. Now, to everyone who heard this, at the time, it seemed totally impossible. No MP3 at the time could do this. Just think, you have to press a button to open music. You have to press another button to open songs. You have to press a bunch of buttons to type in the song you want, and then you have to press a final button to play. That's at least a dozen taps and clicks. But Steve was insistent he reframed the project. It wasn't about building a nice ui. It was about doing the impossible. Finding a song in three clicks or less. Obviously, this reframing pissed off his engineers. They thought he was mad. But by reframing the problem and intensely focusing on letting users find a song in three clicks, the engineers discovered a breakthrough, an innovation that actually made it possible. You'll know what it is. It's the ipod scroll wheel. This was on the first iteration of the ipod. It was a big wheel that people could scroll through to look at a list of songs. They would simply scroll, find one they wanted, and click play. It took just three clicks to find a song with no typing. If Steve hadn't reframed the problem, there is just no way the engineers would have come up with that innovation. They would have built some normal user interface at the time that required double the amount of clicks, and the ipod probably wouldn't have been the landmark product that it was. There's one final reframing example that I'm sure you've heard because it's famous. When Steve was reviewing the final design for the first ipod, the engineers in the room were tense. If Steve approved, they'd finally be able to ship this product after months and months of long hours and hard work. The story goes that Steve was tossing the ipod prototype in his hand. And as he was looking at it, he starts to shake his head, and he says, it's too big. The engineers at this stage went berserk. The engineers explained to Jobs that it was simply impossible to make it any smaller, that they would have to reinvent the invention to make a smaller ipod. And Jobs. He was silent for a few moments with the ipod in his hand. And then after a few minutes, without saying anything, he stood up, walked to an aquarium, which was in the corner of his room and dropped the ipod into the water tank. The device fell to the bottom and small bubbles came out of the ipod and floated to the surface. Steve said, those are air bubbles. That means there's space inside. Now go and make it smaller. The engineers went silent. They couldn't complain of this. Steve was right. There clearly was excess space in the ipod and it could be made a little bit smaller. Steve did a classic bit of reframing here. He didn't just say, make it smaller. He said, eliminate every bit of spare space. And that the engineers could do. They went away, they removed the space, and the ipod became that little bit smaller. If you run a team or a company or need to motivate a team, think about how you can frame the problem you're trying to solve. Because subtly reframing the problem can help someone come up with better solutions and in Steve's case, groundbreaking technological innovation. So let's go back to 1983. Steve Jobs and Apple commissioned an ad for Apple at the following year's Super Bowl. The ad was directed by Ridley Scott and produced by Fairbank Films. And Steve Jobs loved it. Today we celebrate the first glorious anniversary of the information purification of victims we have created for the. It depicts a dystopian setting from Orwell's book 1984. Big Brother is lecturing an audience while one woman, the only person dressed in color, runs through the scene, chased by the thought police. She hurls a hammer towards the screen, which is projecting Big Brother's face, and the screen is destroyed, leaving the audience in shock. We shall prevail. On January 24th, Apple Computer will introduce Macintosh, and you'll see why 1984 won't be like 1984. The screen fades to black and the voiceover ends and the rainbow Apple logo appears. Steve is in the room when the Apple executives first see this ad. And the response is unanimous. The executives hate it. It doesn't show the product. It doesn't say what Apple is. It doesn't say how much it'll cost. The Apple CEO at the time, John Scully, asks if they should fire the ad agency who created it. But Steve Jobs loves it. He thinks the ad is brilliant. He thinks it's a work of art. Problem is, Steve doesn't get the final say. Apple's CEO John Scully does. And John Scully tells the agency to sell off the ad slots for the Super Bowl. They won't be airing this ad. We're not going to put it out. But Steve intervenes. He tells the agency on the sly to keep the slots and to lie to John Scully and say that they can't sell the slots. It's too late in the year. Steve tells the ad agency that they'll have no choice but to air the ad or lose millions of dollars. So Apple had no choice but to air the ad. They go ahead and play the ad at the 1984 Super Bowl. And as many of you know, this ad is an unprecedented success. In fact, it is considered milestone event for Apple, one which elevates them to a legendary brand. The ad wins numerous awards for best advert of all time. And $3.5 million worth of Macintoshes were sold just after the advertisement ran, which Brent Thomas, the art director at Apple, called an absolute success. But why? What was so good about this ad? And how come Steve knew it was so good when no one else did? Well, there's one thing that Steve knew that others didn't. He knew about the curiosity gap. It's a really simple principle. If you pique someone's curiosity, saying a new product will change the world, but don't reveal how the new product will change the world, then you'll capture more attention and more interest than if you had actually revealed what it is. Leaving something unknown captures attention. This is why trailers are so successful. They show just enough of the film to pique our interest while leaving enough unknown to make us watch it. It's why cliffhangers works. A TV show ends, but we don't learn the whole story, so we play the next episode to find out what happened. I've extensively explored the curiosity gap in a previous episode of Nudge. It's called I used an ancient storytelling trick to get 11,000 TikTok fans. Go and listen to that episode if you want to learn more. Steve knew all about this curiosity gap. He used it time and time again at his keynotes. And he knew it would make the ad a success. So he defied his leadership team and went ahead and aired the ad. And this works. The ad hints that Apple will change the world. And it piques people's curiosity, triggering the curiosity gap and making viewers interested to learn in what Apple is building. Without Steve Jobs, that ad would have never seen the light of day. And there's one more example I wanted to share before ending today's episode. It is four years after the Super bowl ad. Since 1984, Steve's had trouble at Apple. The company was failing, and Steve was disliked by many of his peers, not least because he is constantly undermining them and constantly as we know going behind their backs. He is eventually ousted as board member and leaves Apple unfazed. Steve goes and starts a new tech company called Next. The company itself isn't too notable. It's arguably one of Steve's few failures in his career. But Steve's first keynote presentation there, his first presentation to the press, is fascinating. It's another glimpse at how Steve uses psychological bias to manipulate and influence people. First, he rents out a huge arena, one used for concerts, not business presentations. He invites thousands of people and has them waiting for hours for the event to start. This annoys some people, but it piques the curiosity of others, building anticipation. Eventually, he comes on stage and with some classic anchoring, he says.
