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social media buzz

id you know
why same prod-
ucts or services
are offered on
D various prices
in the market? A message
circulating on social media
has an answer to this query.
Here it goes:
Many of you may have a
Sales and Marketing Back-
ground I hope you will find
the article below intetesting.
The Decoy Effect in mar-
keting (superb)
Why does Apple always
come up with three versions
of iPhone?
Let’s understand this by
an example.
Let’s say you are an ice- but disappear when we take
cream lover. You find great Using ‘Decoy effect’ a fifty-cent aspirin? Why do
value in eating ice-cream. we splurge on a lavish meal
One fine day, you are out to market proDUcts but cut coupons to save
to treat yourself. Shop- twenty-five cents on a can
keeper provides you below of soup?
options: A latest WhatsApp message suggests that we’re When it comes to mak-
One Scoop Ice Cream: 13 victims of our own instincts and impulses when ing decisions in our lives, we
bucks it comes to buying things, finds tehelka bureau think we’re making smart,
Two Scoop Ice Cream: 19 rational choices. But are we?
bucks In this newly revised
Three Scoop Ice Cream: expensive option. Standard and expanded edition of
19.5 bucks Can you see a similar the groundbreaking New
The negligible difference pattern in the pricing of economic theory York Times bestseller, Dan
between the prices of 2nd iphone11 by Apple? assumes that Ariely refutes the common
and 3rd options gets your iPhone: $ 699 assumption that we behave
attention. iPhone Pro: $ 999 we are rational, in fundamentally rational
This is called Decoy iPhone Pro max: $ 1099 but we are not. ways.
Effect. Yes, Apple does use Decoy From drinking coffee to
A 2nd option is just a effect to drive consumer to Most of the time, losing weight, from buying
Decoy option. Companies buy the expensive version of we’re deeply a car to choosing a romantic
provide decoy option so their product. Not only they partner, we consistently
that customer can com- are making quality products, irrational. overpay, underestimate, and
pare Decoy option with an but also they are not leaving procrastinate.
expensive option (and select any stone unturned when However, it Most of the time, we’re
the expensive one). it comes to marketing and doesn’t follow deeply irrational. Yet these
In the absence of a decoy selling their products. misguided behaviors
option, the customer will Explained very well in that we’re are neither random nor
compare: 13 bucks vs 19.5 Dan Ariely’s book “Predict- chaotic. There senseless.
bucks - and may probably go ably Irrational”. They’re systematic and
with a cheaper option. are predictable predictable — making us
But with decoy option, Tehelka Bureau adds: The patterns in our predictably irrational.
the customer now com- book also explains why do There are predictable pat-
pares 19 bucks vs 19.5 bucks our headaches persist after behaviour terns in our behavior.
- and most likely selects the we take a one-cent aspirin letters@tehelka.com

Tehelka / 31 october 2019 59 www.Tehelka.com