At the moment we are in the full swing of the Olympic Games (well, apparently – I keep seeming to miss it). The personal stories of athletes around the world as they have faced mental, physical, personal and financial struggles to achieve their dreams are always compelling to the rest of us mere mortals. Everyone loves a hero – even if those heroes don’t get to stand on the top podium in the end. And every hero goes for gold – giving that ‘110%’ – even if that dream still seems slim to none when they finally make it to the starting that their whole life has been about preparing for…
The majority of the rest of us however, prefer silver.
I wrote the other day about how the human brain is still relatively underdeveloped in the face of what we are trying to cope with in modern life. In a nutshell, we were built to survive and thrive in small, tight knit ‘tribes’…To go for days without food, expel stress through physical activity, have hours without outside stimulation to entertain us and just deal with the ‘now’. So it’s understandable that the world of supermarket isles, digital screens and over 7 billion people in potential reach of one another has become somewhat daunting. We were ‘designed’ to wander, explore, dream, and have our brains constantly challenged by situations in which the ‘danger’ of a bad choice could mean life and death.
So, because of this ‘monkey brain’ hard wiring again, we have some peculiarly strong impulses when it comes to choices.
Namely, we go for silver.
What I mean by that is when presented with three options – gold, silver, bronze or a,b,c – we will invariably tend to go for the middle unless something blatantly stands out as the best.
In fact, it is especially true when we can’t see a difference.
For example, if you want to lower your chances of picking up any nasty germs, never opt for the middle toilet in your office bathroom.
It’s statistically the most popular amongst your colleagues if they all look the same (the stalls, not your workmates…that would be weird). Instead, go for the second or third last one instead. They’re the least favoured.
Never one to miss an opportunity for a bit of random research, I actually trialed this theory for a full weekend festival last year and got clean, loo-roll filled nirvana every time! Incidentally, it also works for train carriages, car park floors and um, karaoke booths.
But why does it happen?
Well it turns out we feel the ‘middle’ choice is erring on the side of caution. When we can’t puzzle out the difference between things ‘rationally’* and quickly, the irrational monkey brain takes over and makes the decision for us. And monkey brain likes safe decisions. Ones that don’t get us killed by saber teeth tigers or expelled from our pack. And it happens on such an unconscious level that we don’t even realize it’s going on.
From a marketing perspective (aside from the fact that marketers also have to use bathrooms) this is really important because it has given us one of the best sales strategies of all time, if not the best.
The Bronze, Silver and Gold approach – a three tiered pricing structure.
No doubt you have seen them dozens of times before…
Although I particularly love how Survey Monkey have priced theirs as ‘Gold’ and Platinum’ instead – thus avoiding the whole irksome business of ever making any part of homemade quantitative online research any less glamorous than I’m sure it already sounds.
Here are a two more well known examples:
This one is from Netflix. You have to admire how they’ve also used suggestive verbal deters like ‘basic’. Ugh, who wants basic anything?! Incidentally, the difference in price of these three mean nothing to them in terms of supplier costs. Genius.
I don’t think Vodafone expect a single person to opt for option ‘a’ or ‘c’ when they have done the maths… Incidentally, ‘Red’ is our monkey cue for danger. ‘Green’ is good.
The important thing here is that neither a or c every actually really matter.
Sure, you’ll get a few maverick stragglers but in reality, the worse you make those deals on either side of the middle choice, the even more enticing the middle is.
Because we have to remember as marketers – there is always the invisible choice ‘d’ – the walk away. The no sale.
So, as a brand or sales person, you never really have any intention of selling either of the other two packages. They purely exist to make the middle option as enticing as possible. Preferably, by making consumers think they’ve ‘got one over on you. ‘Haha – I see you want me to pay $900 for premium but I can see standard gets me all of the same things, minus the thing nobody would ever wanted for 200 euro less! SOLD!‘.
One thing you will notice about these price plans you will notice is that they are always for stuff that is in relatively limitless supply – such as cloud storage, music subscriptions (they aren’t going to ‘run out of’ Justin Beiber on Spotify, unfortunately), insurance add ons and additional access (e.g. premium memberships for dating sites)…
‘Digital’ or service examples are easy to think of but it is also basic marketing principle that is applied to physical commodities that have a extortionately low expense for the seller. The best examples of these are probably coffee, popcorn and soft drinks. The average XL popcorn costs around 2c to produce apparently – which makes a lot of sense really, but is quite shocking when you consider how much you forked over on your last cinema trip!
So, next time you are faced a decision, and someone gives you three options… Be wary. Chances are the person selling to you hasn’t paid very much themselves for some part of the thing they are try to get you to buy.
Engage the human brain, not the monkey one!
* ‘rational’ has been astixed for the benefit of the passionate micro-economists.
PS The one place you never see clever choice structures like these applied are among public bodies likes arts and museum memberships and charities. If anyone is involved in any of them please tell them to start. It could make a huge difference in revenue!