A little more choice can go a long way, done right

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Given a choice, most people will select the middle option. But there is a way you can induce more expensive purchases -- add a $200 bottle to the selection list.

In an earlier posting, I reported on the problems that occur when you give too much choice to potential decision-makers. If there are dozens of options, often the answer is: “I’ll do nothing” — an issue that for example can cause havoc when there are elections with many candidates for many similar positions.

(Municipal elections in Vancouver, B.C., for example, are structured so that all elections — for city council, as well as the school districts and park board — are “at large” with voters needing to select overall more than two dozen candidates. The solution — party branding — allowing voters to select by slate — which works okay when the party slates are logical, but this year, at least, there has been a break-down in that system, so voter confusion is greater and I believe polling turnout will be adversely affected.)

While too much choice, therefore, presents a marketing challenge, there is a sweet spot where a little additional choice can go a long way, even if the extra choice is a phantom offer.

Some years ago, for example, the Economist magazine developed pricing grids for print and print/electronic option, as well as a purely electronic choice.

Jonrobert Tartaglione presents these points in the Neuropsychology of Influence and Decision-Making, a report commissioned by the Society for Marketing Professionals (SMPS) Foundation and available without charge to SMPS members.

“You go to their website and are presented with three subscription options: An online-only subscription for $59, a print-only subscription for $125 or an online-and-print bundle for the same $125. Which do you choose?”

The obvious question you may be asking, is why even offer the “print only” option, when logically no one would purchase it?  The answer: By creating the extra choice, many more people pick the more expensive print/electronic option than if the were given the same choice without the “print only” variation. The issue, Taraglione, relates to contrast and perceived value.

Another test could be setting out a wine list with three choices, one for $25, one for $50 and one for $100. Generally, he writes, people will gravitate to the middle spot because they perceive it is the balanced place between price and value. But say you are a restaurant and want to sell more expensive bottles. The answer: Add a $200 choice — and many more people will purchase the $100 option.

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The extra more expensive bottle will encourage many more people to purchase the $100 option.

(I think we all know that restaurants often take the choices too far — by listing dozens of wines on their menu. This may make them seem more exclusive, but the result is often that the clients decide to forego wine altogether. A better choice, if you have a large selection, is to create a simple quick-pick option with four variations.)

How can you apply these concepts for architectural, engineering and construction marketing? One approach in preparing presentations/proposals is to offer a good/better/best option with variations depending on the scope of work, materials quality and the like. Your goal will be to primarily sell the “better” choice — but the variations in “good” and “best” will enhance the ideal selection’s acceptance (and, yes, there will still be some who elect to go high or low-end.)

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