Image of IKEA logo on superstore

IKEA Effect

Definition:

The IKEA effect is a cognitive bias that results in the increase in the valuation of items or services we partially create. The effect is reduced if we destroy the item or fail to complete it successfully.

Perhaps one of the most powerful examples of the IKEA effect was on the sale of instant cake mixes in the 1940s. Initially sales of cake mixes did not respond to advertising and marketing activity. To discover why sales were so low the psychologist Ernest Dichter was employed to observe and interview housewives in their own kitchens.

Image of a Victoria sponge cake

What he found was that because the cake mix made the process of baking so simple housewives felt undervalued. Dichter recommended that in future the cake mixes should be sold without eggs as an ingredient. This meant that customers had to add their own fresh egg to the mix and this additional contribution quickly led to a huge turn around in sales of the product. Notice the message in the top righ-hand corner.

Image of instant cake mix example of IKEA effect

 

Resources:

Conversion marketing – Glossary of Conversion Marketing.

Over 300 tools reviewed – Digital Marketing Toolbox.

A/B testing software – Which A/B testing tools should you choose?

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