Heidi Grant Halvorson, Ph.D., motivational psychologist and author of ‘Succeed’ and “Nine Things Successful People Do Differently” writes a must read article for HBR.org and the Huffington Post titled “The Presentation Mistake You Don’t Know You’re Making.”
Dr. Halvorson discusses an important principle in behavioral economics – a pervasive bias in presenter thinking (“more is better”) that actually runs counter to an equally pervasive consumer perceptual bias (less is more). The implications for marketing are significant.
The Presenter’s Paradox: More is Actually Not Better
In 2012, psychologists Kimberlee Weaver, Stephen Garcia and Norbert Schwarz undertook a robust series of seven studies into the “presenter’s paradox” in the Journal of Consumer Research, Inc. Their findings in impression formation demonstrate that:
Perceivers’ judgments show a weighted averaging pattern, which results in less favorable evaluations when mildly favorable information is added to highly favorable information…We show that presenters…instead design presentations that include all of the favorable information available. This additive strategy (“more is better”) hurts presenters in their perceivers’ eyes because mildly favorable information dilutes the impact of highly favorable information.
The Effect Explained
We assume when we present someone with a list of accomplishments or a bundle of product and service benefits, that consumers will see what we’re offering additively. The example Dr. Halvorson gives is this: In applying for a job, we may list the following qualifications:
- Graduating from Harvard.
- Having a prestigious internship.
- Demonstrating a record of successfully applying rigorous statistical skills.
Knowing that the company does business in Latin America, we add the following skillset:
- Having taken 2 semesters of Spanish in college.
- 10 + 10 + 10 + 2 = “32” in impressiveness.
But the client or buyer reasons differently: Consumers don’t add up the impressiveness, they average it, seeing the big picture by looking at the package as a whole, rather than focusing on the individual parts. Their perception:
- (10+ 10+ 10+ 2)/4 = “8” in impressiveness.
The better proposition is to not add the less impressive benefit or accomplishment (2 semesters of Spanish.) The consumer averages this as follows:
- (10 + 10+ 10)/3 =”10″ in impressiveness.
So mentioning an additional benefit of lessor value makes you a less attractive candidate than if you’d said nothing at all.
The Effect Also Works “In Reverse
- 86% of participants administering punishment felt that the fine plus community service would be the stronger deterrent.
- However, participants who were handed these punishments rated the $750 with the two hours of community service as significantly less severe than the fine alone.
They reasoned that the overall punishment was on average less disparaging because two hours of community service isn’t really that bad.
The research examines the implications of this effect for a variety of marketing contexts. Buyers were presented with an iPod Touch package that contained either an iPod, cover, and one free song download, or just an iPod and cover. The surprising result:
- Buyers were willing to pay an average of $177 for the package with the download.
- But they were willing to pay $242 for the one without the download. The addition of the low-value free song download brought down the perceived value of the package by as much as $65.
Yet, a second set of participants asked to play the role of marketer and judge which of the two packages would be more attractive to consumers overwhelmingly (92%) choose the package with the free download.
Financial Marketing: Humana Cheapens Their Value Proposition
Medicare Advantage products offered by private insurers provide an alternative to traditional Medicare. They are aptly named since have some significant advantages: they are more comprehensive, covering deductibles and copays that traditional Medicare does not, and prescription drug coverage as well, if elected.
They also provide some additional ancillary benefits, including vision care and wellness benefits.
One of the big providers, Humana, aired an infomercial during the end-of-year open enrollment period. The infomercial devoted a disproportionate amount of time to hawking the benefits of, and showing client testimonies about, membership in the Silver Sneakers fitness program. The value of health club membership is rather insignificant in comparison to providing comprehensive care in the event of chronic and life threatening illness. The presenter’s paradox informs us that devoting so much time to calling out this benefit of lesser value cheapens the consumer’s perception of the brand.
More is actually not better, when you add a benefit or feature that is of lesser quality than the rest of your offerings. Its dilutes the favorability of core benefits.
Dr. Halvorson’s advice: to stop ourselves from making this kind of mistake, marketers should think “big picture:
What does the package I am presenting look like taken as a whole, and are there any components that are actually bringing down its overall value or impact?
Related articles by Heidi Grant Halvorson, Ph.D.: click here.