The truth of relativity.

By 10th February 2019Uncategorised

The truth of relativity.

Here’s a test. Be honest now. Think of your favourite weekly/daily magazine, newspaper or publication. If we said to you, you could subscribe to it but you had the following options:

 

Option 1: The online version only for R49 a month

Option 2: The print version for R99 a month

Option 3: The print and online version for R99 a month

 

Which would you choose? Answer before you carry on reading.

 

However, what if we said you could subscribe to just the following 2 options:

Option 1: Online version for R49 a month

Option 2: The print and online version for R99 a month

 

Now which would you choose?

 

Does your answer change? It’s likely, unless you’re the exception, you originally choose the double threat of print & online or the cheaper online version. And the main reason is because the power of relativity. If you have 3 options, it’s easier to compare “like for like” so we immediately, and irrationally, pick between option 2 and 3 as they’re similar ballpark options. Our brain considers it the best deal in the circumstance because option 1 has nothing to compare to. But when there are only 2 options, we think logically about each, compare one against the other and pick the one that makes more sense, namely the digital version.

 

This is one such example from the book Predictably Irrational by Dan Ariely. It’s a brilliant book on behavioural economics (we HIGHLY recommend it) and how there are real hidden forces that shape ours (and consumers’) decisions.