Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.
+1 212 318 2000
Europe, Middle East, & Africa
+44 20 7330 7500
+65 6212 1000
Sometimes a client or customer is frozen into indecision because of tradeoffs among the prices, features, reputations of the brand and vendor, and predicted ease of use, among other qualities of several products. Research from the University of Toronto suggests that one way to dislodge ties is to introduce a new alternative that is clearly inferior to one of the items being considered.
Here’s my adaptation of the researchers’ example: A customer comes into an electronics store to buy a printer. The customer narrows the choices to two and then pulls out an article she brought to the store with her because the article includes authoritative ratings of printers. Printer Model A, at a price of $180, has a rating of 50. Model B, for $260, received a rating of 70. The customer can’t decide between the two and finally says she wants to look at other stores.
The salesperson replies, "May I show you one more model I think will help you decide? We carry a complete selection of printers, so I hate for you to have to go shopping somewhere else." The customer agrees to look at one more printer.
The salesperson presents a model from a manufacturer that does a lot of advertising, but has recently not received high ratings for their printers. If asked, the store’s staff doesn’t give the model high recommendations. Still, they carry the model because people ask for it based on familiarity with the advertising.
The salesperson says, "The price for this model is $180, like Model A, but if you check your article, you’ll see it received a rating of 30, not the 50 that Model A received."
The University of Toronto researchers report that the introduction of the inferior alternative often dislodges the tie and results in a purchase decision. With this set of facts, the choice is more likely to be Model A.
Bruce D. Sanders
Want to improve the way you run your business? Entrepreneurs, academics, and consultants from diverse industries offer practical advice on a variety of topics each business day.
To submit a tip for consideration, first check our archive of previous tips to make sure you're not repeating a tip someone has already contributed. Then send the tip to Small Business channel contributor Michelle Dammon Loyalka. Because of the volume of material she receives, she may not respond to each individual.