Do You Know You Got Ripped Off? They Are Betting You Didn't Even Notice
I had a rather long list of errands to run and one of my stops was the grocery store. One of the items we needed was peanut butter, which seemed to have a permanent place on the shopping list. How do my kids eat so much peanut butter?
The grocery basket was bypassed because I was in a hurry (I know it doesn’t make any sense). My hands were full by the time I found the isle hiding the peanut butter. I grabbed the largest package of our preferred brand and managed to tuck it between three other items I was struggling to keep off the ground.
I somehow arrived at the cashier without damaging any of the groceries. The next few stops on the errand list were soon completed and I made it home in one piece. Mission accomplished!
As I was putting the groceries away, I noticed the peanut butter package felt a little smaller than usual. I paid the same amount (that I did notice in the store), but the package didn’t seem the same. There were a few spoonfuls of peanut butter left in the old jar, so I did a quick comparison. The new package was clearly smaller.
Same store, same product, same brand, same price… smaller package.
This is an old marketing trick that regained popularity during the Great Recession. It’s simply a way to squeeze more profit per unit sold. Because I’m a marketing geek and retail aficionado, I notice these things when I encounter them in the market. When I shop, I compare the price per comparable unit of measure on the products we typically buy at the three grocery stores our family frequents. Nerd alert!
I know what you are thinking: So, hotshot… if you’re so smart, why didn’t you notice the price discrepancy of the smaller package of peanut butter? Great question! Here’s why:
Time pressure. I was in a hurry and time pressure is one of the momentary lapses of reason. These are triggers that activate what some psychologists call our System 1 or autopilot (unconscious) cognitive processing system. When we are under time pressure, we rarely think rationally and analytically. I just wanted to get the peanut butter and move on to the next item on my to-do list. I didn’t have time for a price per unit analysis.
Familiarity. When we are pressed for time or don’t have enough information or don't care to properly analyze a decision, we often resort to choosing the familiar. Familiarity is one of the seven deadly sins of decision making that we fall for when we let autopilot make our decisions. I simply chose the largest package of the peanut butter brand I typically buy. I glanced at the price to confirm it was the size we usually purchase and it was. Well, it was the same price, anyway.
Consistency. We human beings value consistency and loathe change. Once we’ve made a choice, we own that choice and we tend to stick with it. In essence, we hate to admit that we were wrong. Consistency is also a decision-making shortcut. Most rational people don’t analyze the cost per unit of peanut butter every time they shop. We simply buy the same thing we bought last time and move on with our day. I bought the largest version of our favorite peanut butter brand and “double-checked” it with the price on the shelf. Yep, same price, largest package. Done.
Familiarity and consistency are powerful decision-making forces. Don’t believe me? Take a look at your fridge and pantry. How many of those brands did you grow up with? Did you do a fresh analysis of the alternatives to determine the best choice or did you simply carry on the tradition set by your parents or grandparents?
Smart brand marketers understand this and work very hard to get us to choose or adopt their brand as early as possible. Once we have made a choice, the need for consistency and the crutch of familiarity take over and it is difficult and expensive for competitors to lure us away. In fact, marketers are betting on it.
Peanut butter is obviously a low-value purchase, meaning I probably would have bought the smaller package even if I had recognized the discrepancy in price per unit. The disparity was less than a dollar and my family needed more peanut butter. No big deal. However, we fall for the same decision-making mistake on high-value purchases like automobiles, electronics and even houses. Do these tactics sound familiar: “it’s a limited time offer,” “while supplies last,” or “another buyer is interested in the home or car you want to purchase?”
These tactics are intended to push our time-pressure button, sending us into a momentary lapse of reason. When our autopilot decision making is engaged they can sneak in a smaller package at the larger-package price and you won’t even notice.
The next time you feel the pressure to make a decision quickly, remember that you are susceptible to influence tactics. Your best defense is awareness. Recognizing that you are in a momentary lapse of reason triggers your System 2 or rational/analytical (conscious) cognitive processing. This allows you to make better choices and avoid one of the dreaded seven deadly sins of decision making.
The next time I’m in that store, I’ll be sure to check the unit cost of the peanut butter before I make a decision… unless, of course, my hands are full, I’m in a hurry, it’s the last jar on the shelf and another customer is eyeing it. Then, all bets are off.