Say you are hungry. You are offered either an apple or an orange to buy and you really don’t have any special preference for either of them. Which one would you choose?
When buyers are offered vastly different product options, they struggle to make a decision. That’s coz it can be very challenging for their brain to analyse selections that are not alike. They are literally forced to compare apples and oranges!
In such situations, a smart way to help the buyer decide is to introduce a third option that is inferior to one of the others. The lesser alternative makes the option that it is dominated by, look more appealing.
In the case of the apples and oranges, if a sub-standard apple is offered, their brain unconsciously judges the two apples and selects the better one. The brain just compares it to the one that it was most similar to and discards the new option!
Put simply, a decoy was offered to make it easier for the brain to arrive at a decision. This phenomenon is called the Asymmetric Dominance Effect.
A fascinating set of experiments by psychologist Dan Ariely demonstrates how this effect shifts perception and can even cause the average sale price to rise. Ariely asked MIT college students to evaluate subscription options for the Economist magazine.
Experiment 1: Students were presented with two annual subscription options.
Option 1: $59 for online access
Option 2: $125 for print and online access
In this experiment, 68% of the students chose the print and online option while only 32% chose online only.
Experiment 2: Students are presented with three annual subscription options:
Option 1: $59 for online access
Option 2: $125 for print only
Option 3: $125 for print and online access
The addition of the decoy – Option 2 – caused the average sale to jump as 84% of the students chose the print and online option, while only 16% chose online only. No one chose the print-only option. I am sure you would have reacted the same way as the majority did.
Buyers get overwhelmed when evaluating radically different options. This frustrates them and they are unable to take a decision. It is here that you can deploy the asymmetric dominance effect to relieve the pressure by making the task of comparing the options less cognitively demanding.
Next time, when you are trying to make your customers compare apples and oranges, just offer them a bad apple!