by Patrick Appel
Derek Thompson finds evidence that “choices reduce anxiety by making us feel like we’ve searched exhaustively — and now we’re ready to buy”:
A few years ago, Williams-Sonoma had a problem. They couldn’t get anybody to buy their breadmaker, which retailed for $279. So they did something that might strike you as bizarre: They started selling a $429 model, as well. Of course, nobody bought the expensive version. But sales of the cheaper model doubled.
Why?
You could offer a few reasons. One is that the fundamental rule of prices is that consumers don’t know what anything should cost (especially breadmakers) so we’re persuaded by clues. The expensive breadmaker here acted as a clue — a decoy that told other shoppers: Hey, you are getting an amazing deal on this breadmaker!
But another possible reason is that we’re incredibly reluctant to certain items — especially expensive items — when only one option is presented. If you walked into a Best Buy store, and there was only one TV left, would you buy it? Even if it was pretty much what you were looking for? [Daniel] Mochon’s research [pdf] would suggest that many of you wouldn’t.
The Dish 