Alternative title: 4 WAYS TO TAKE ADVANTAGE OF HUMAN NATURE TO SELL THINGS TO SUCKERS
Most people realize that companies are in the business of making money. They like using marketing that targets loopholes in our seemingly rational psychology. Lots of self proclaimed “savvy consumers” think they are smart enough to avoid clever sales tactics. WRONG. Like it or not everyone succumbs to marketing! Education and abstinence are your best tools.
Predictably Irrational by Dan Ariely describes these psychological loopholes that often end up with us buying more stuff. Lets take a look at some:
1 – Relativity – Making decisions based on bogus comparisons
Imagine you are buying wine and there are three choices. You don’t know much about wine so you base your decision on price. The prices are $10, $25, and $30. You don’t want to appear cheap to your hot date so you axe the cheap one, and you are conscious of saving money so you axe the $30 one and go with $25.
Little do you know the $25 wine is exactly what the restaurant wanted you to pick. They understand that most people won’t buy the most expensive item, but they will buy the second most expensive. The priciest item is a decoy. Here is an example right from Predictably Irrational:
You want to subscribe to the Economist magazine. The choices are:
- Economist.com subscription – $59
- Print subscription – $125
- Print + web subscription – $125
Wait what? Why is the print + web the same price as print? does that mean the web is actually free? Well if that’s true then it’s a great deal and you buy the print + web for $125.