Bernie Madoff’s ability to fool many investors could be recorded as the greatest fraud of the century. The business mogul perfected the art of persuasion to defraud investors. However, business analysts argued that Madoff used the art of deception to swindle his clients. People who believed that Madoff’s scheme centered on Cialdini’s principles have countered this view.
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I will analyze Madoff’s scheme using Cialdini’s principles. The book ‘Influence’ described compliance techniques and their strength. However, ‘The Art of Persuasion’ is the basis of Madoff’s endgame. I will analyze sections of the article to highlight the effectiveness of Madoff’s persuasion scheme. Business analysts cannot comprehend the destruction caused by Madoff’s persuasion skills because the effects of the great swindle linger in the mind of victims.
Multiple compliance technique includes liking, social proof, scarcity, consistency, reciprocity, and authority (Cialdini 4). Madoff used the elements to understand the effectiveness of subtle persuasion. The author revealed that authority is the weapon of the rich. As a result, people dared to question the authority of credible people.
The concept provided the platform for Madoff’s Endgame. Madoff was the Chairperson of the largest security organization listed on the Nasdaq. As a result, people believed that his integrity and reputation transcend business market. Thus, Madoff played with their ignorance and short sight.
Cialdini revealed that reciprocity stimulates an individual to return favors for generosity. As a result, Madoff suggested that benevolence and generosity were the best gift to his clients. Thus, the clients were obligated to return Madoff’s favor in folds. As a result, Madoff engaged customers with a business gift that enslaved their loyalty to his organization.
The customers believed that Madoff’s gestures were better than other offerings from rival organizations. The article suggested that people are consistent in their beliefs if they remain loyal (Cialdini 9). As a result, Madoff utilized this principle to evade constant examination. Thus, clients accepted his views based on consistency. Consequently, Madoff used the weapon to infiltrate the minds of his clients and their associates.
Thus, his victims accepted their positions as Madoff’s adherents. As a result, they did not question his rules, beliefs, and business tactics. Madoff employed the consistency principle in his advertisement. As a result, he explained that clients were lucky to be friends with benefits.
Thus, people deposited huge amounts with the organization for long periods without fear. Consequently, the deposits were not recovered because the clients believed they would lose their stake in the organization. Social proof described the existence of class and power. As a result, Madoff’s clients used the word-of-mouth to spread the news.
Madoff’s client base increased the deposits and investments of the organization. An individual’s attitude affects the perception of others. Liking principle influenced people’s choices toward Madoff’s organization. As a result, more clients registered with the organization simply because they liked the executive. The strategy exposed the weakness of Madoff client’s before the actual swindles. Thus, the marketing strategy improved stimulated investors to organize meetings and dinner parties for their cronies.
Thus, Madoff inflected selective pain on the clients without resistance. Madoff’s clients refused to withdraw their financial engagement because of fear, authority, consistency, and scarcity. Consequently, Madoff used the principle of compliance to engage his victims. Finally, Madoff’s victims to date cannot understand why they accepted him without resistance.
Cialdini, Robert 2001, Harnessing the science of Persuasion. PDF file.