Welcome to our Business Education Network, we have developed the Pulse as a means to deliver complimentary, high-level business information to our clients, prospects, and personal contacts, helping them keep a finger on the pulse of the ever-changing, dynamic business world of today.
If you’ve ever sold anything, you’re probably familiar with the concept of perceived value – the customer’s perception of a product or service in comparison to a competitor’s. Perceived value dictates what price the public is willing to pay for a service – and it doesn’t always line up with an item or service’s actual value.
The ‘dilution effect’ is the name given to a cognitive quirk that shapes our perceived value of any given set. This is because our minds don’t add together information, but instead they average it. Would you rather buy a smaller dish set with everything in pristine condition, or a larger one with several broken pieces? According to the research, the answer is overwhelmingly the smaller one – even if you’ll get more pieces overall with the larger set, and even at a reduced price.
The same concept can be applied to influencing others. Adding weaker, less compelling arguments to support your main point can actually reduce the weight of your overall argument!