#### The Motivation Equation

# Why I Haven't Purchased a ShamWow.

I have to admit, I like saying the word: ShamWow. So do millions of others, which partly explains it's marketing success. Vince Shlomi, pitchman behind this liquid-soaking wonder, makes an effective appeal

Then Vince dazzles us with a demonstration. "ShamWow holds twelve times its weight in liquid," he says, plunging the towel into a bowl of water and soaking it up with INCREDIBLE quickness. "Look at this, it just does the work. Why do you want to work twice as hard? Doesn't drip! Doesn't make a mess!" Then he squeezes it back out into the bowl, and we watch in awe, AMAZED at the miraculous work it does. Then, when he tells us it's made in Germany, making it "well engineered."

"ShamWow," he finishes, "You'll be saying WOW every time."

Then the commercial cuts to a bunch of extremely happy people tell us how the ShamWow has literally changed their lives. You can tell by the evangelistic excitement in their voices that they were once lost and broken, but now, because of the ShamWow, their lives are whole again. Then, when we finally get to the price, you discover that you can get four of these miracle workers for only $19.95. We're feeling even more motivated to make the call.

But wait! Here's where it all changes. "If you call right now," Vince gushes, "you get not four, but EIGHT ShamWows for only $19.95. And if that isn't good enough for you, you get a ten year warranty on the towels! Order now by calling 1-800-SHAMWOW." Seems like enough to get everyone racing for the phone.

Despite the compelling commercial, I haven't picked up the phone and purchased a ShamWow. But millions of people have. Whether you have a set of these bright orange wonder-towels in your possession or not all depends on a simple math formula of motivation, something every living person on earth uses every single day to make their decisions, whether they liked math in school or not. We'll call it "the motivation equation."

The equation is simple:

(P x O) - W = M, or Payoff times Odds of Success minus Work equals Motivation. Let's review each of the elements:

Payoff. P stands forpayoff, which is your estimate of the benefit associated with some particular activity or thought.Odds of Success. O is theoddsthat you might actually receive that benefit. Together (P x O) become something behavioral economists callexpected value- the value you expect to receive in any situation when you estimate both the payoff and the odds the payoff will occur.Work. W stands forwork, the next element in the equation. This is the estimated time, money, and resources required to realize the benefit.Motivation. M stands formotivation, which is the level of incentive or disincentive you'll have to take action. If the expected value exceeds the work, there's positive motivation. If the expected value equals the work, there's no motivation. And if the expected value is less than the work, there's negative motivation.

Like everyone else, I've done my ShamWow math, and come up short of the required motivation to make the purchase. For me, the payoff is too low and the work too high to create any positive motivation. *I can get the same thing done using a dishrag*, I reason to myself. In my personal opinion (again, just my personal opinion), the ShamWow is just a bag of rags, not enough payoff to justify the work of picking up the phone, making the call, paying the $19.95 plus shipping and handling, and resisting a high-pressure upsell once I'm on the phone. Here's my ShamWow motivation equation:

(Payoff x Odds) - Work = Motivation, where

- Payoff is a pack of fancy dishrags worth maybe $5 for me.
- Odds of success is 100% (I'm certain the ShamWow works, and certain that it'll come to my door when I order it).
- Work is $20 cash plus shipping plus time spent on phone plus annoying high-pressure upsell to reject once I get on the phone. Let's say that's at least $40 in value to me, when you account for my time and effort.
Putting those numbers into the equation, you get ($5 x 100%) - $40 = -$35. That's five dollars in benefit minus thirty-five dollars of work, which means the ShamWow offer has a negative thirty dollar motivation value to me. What's interesting about using the motivation equation is that it offers the ability to estimate where I'd stand if the other factors were changed. For instance, if the ShamWow was offered for free, would I pick up the phone? The answer is no, because I value the ShamWow at five dollars and estimate more than five dollars worth of sales pressure and lost time in going through the ordering process.

You'd have to pay mebefore I'd even consider ordering a ShamWow.

Why does the motivation equation matter? In every decision we make, whether it be as trivial as ordering a ShamWow, or as significant as changing our career or marrying the love of our lives, we do the math behind the motivation equation. The motivation equation is the hidden logic behind all our activity, and the better we get at seeing this math at work behind the scenes, both in our own lives and in the lives of others, the better we'll get at making change work.

*Take our free MoneyFinder Quiz to see just how much payoff Erik's latest discipleship program, Breaking Free, can create in your financial life! *

#### about erik van alstine

*Erik is a change expert and the author of the personal finance discipleship system, *Breaking Free: Financial Strategies that Transform Debt into Wealth*. *Breaking Free* is like driver's ed in your financial life, a powerful video curriculum that offers experiential learning, assessment, and transformation!*