Shopping can be tough on a person. Akshay Rao, head of the Institute for Research in Marketing at the University of Minnesota’s Carlson School of Management, has proof.
Rao and a colleague from the University of Iowa used magnetic resonance imaging (MRI) scans of people’s brains to examine an established phenomenon called the attraction effect. In short, the attraction effect works as a tiebreaker when we shop (or choose candidates in an election or entertainment options on a Friday night). Faced with two or more choices that are equally attractive for different reasons—a car that gets great mileage but has a wimpy engine, and one that has great acceleration but guzzles gas—consumers will dither. But offer them a third choice that’s clearly a no-go (a car that has little power and only so-so mileage) and they’ll find it easier to decide. They’ll also lean toward the better choice that’s most similar to the bad choice—in the car example, they’d tend to pick the low-power, high-mileage vehicle.
Rao and his research partner proved that a “decoy” product gives mental and emotional relief to consumers. Their study, published in the February Journal of Marketing Research, showed increased activity in the amygdala—a primitive part of the brain that’s involved in negative emotions—when consumers faced a “tie” between equally desirable choices. It subsided when a third, less attractive option was offered. The presence of the decoy appeared to let the brain rely on heuristics and decision-making shortcuts rather than fully weighing each option.
James McComb, a retail consultant and president of McComb Group, Ltd., in Minneapolis, says retailers like Target and Sears have facilitated something like this for years by displaying three versions of a product in close proximity—a good, better, and best option with corresponding prices. And Rao says he sees stores, cell-phone-plan marketers, and many others using decoy options or loss leaders to make core products more attractive.
For retailers, making the attraction effect work requires knowing what the consumer is looking to them for—what the shopper is mentally grouping. If it’s sweaters, then all of the options need to be sweaters. But during the holidays, “Target should recognize that consumers are looking at CDs and sweaters and golf clubs in the broad category of ‘gifts,’” Rao says. “During back-to-school season, consumers are looking at pens and notebooks and backpacks and so forth in a category of ‘back-to-school products.’”
That’s where market research comes in, he adds. “Always step back and ask yourself the question: ‘What’s the customer thinking of?’”
