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€163.967 Specific numbers
The more expensive option
is chosen over the rounded
number. It is also shown
that rounded numbers are
more often renegiotiated
than exact numbers.
We all know the effect of 9,99! This effect
makes us believe that it is cheaper than 10
and therefore not that expensive (in our
minds). There is even a more sinister effect
with specific numbers. When comparing
house pricing, people believe that a price
listed as 163.967 Euro is a more honest
price than 150.000 Euro.
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Compromise effect
When offering three or
more options, people are
more often to choose the
option(s) in the middle
Think about when you buy your
coffee at a coffee store or when you
chose a wine from the wine menu. It
is suggested to put your most profit-
able options in the middle for your
customers to choose.
· RED WINE ·
· WHITE WINE ·
· HOUSE WINE ·
$20
$25
$15
Menu
wine
BAR
· since 1983 ·
Default
when provided a default
option people stick with
that option if it is hard to
make a choice.
Think about the default ringtone on
your mobile phone, the same
brands you buy at the supermarket,
or even default service plans
presented to you. All to make the
life of the consumer much easier,
but also the retailer more profitable.
The decoy effect
The preference between
two options can be affected
by a third option.
The decoy effect is a common
named given to a well used effect in
sales and marketing called the
asymmetric dominance effect which
unconsciously makes people choice
more expensive options or options
the retailer wants you to choose.
Soda
Soda
Soda
Small
$3
Medium
$6.50
(The decoy) Large
$7
Behavioral Insights can be used to enhance consumer spending and brand
perception by manipulating the effects of psychological, social, cognitive, and
emotional factors on individual decision-making.
for retail
Behavioral Insights