Behind the Gavel: Mastering Sidekick Merchandising

I’ve always marveled at fictional sidekicks. A good sidekick lends perspective to enigmatic heroes and helps us to know them better. How well could we understand the complexities

of Sherlock Holmes’ mind without having Dr. Watson to ask the questions we are thinking? How much more dignified is Andy Griffith when compared to simple-minded Barney Fife? How much cooler is Ferris Bueller when compared to his uptight best friend Cameron?

Sidekicks give us a point of comparison, and the drive to compare is inborn in humans. There is a branch of behavioral economics titled “Social Comparison Theory” [http://bit.ly/1jMgrXj], which postulates that humans have a basic drive to compare the various elements of their environment. Sidekicks provide us an easy way to compare A with B.

Antique dealers can use a consumers’ basic drive to compare to improve their merchandising. Dealers love to fill their shelves with unique, one-of-a-kind items. Perhaps these treasures would sell faster (and for more money) if we provided a “sidekick” item as a point of comparison for our shoppers. Big-name retailers have been using the “sidekick” marketing method for decades, with good results. Back in the early 1990s, Williams & Sonoma introduced the first bread-making machine to America. Their research had shown that the item would be well-received by consumers: Pour the ingredients into a machine, turn it on and a few hours later one has fresh baked bread. No kneading and no floury mess to clean up.

Williams & Sonoma executives were surprised to find their revolutionary machine didn’t sell very well. Priced at $275, the machines just sat on the shelves. The machine had been brought to market at considerable expense, so no expense was spared to find a solution to the lack-of-sales problem. When all proposals had failed, a retail consultant was hired to find an answer.

The consultant’s solution was surprising: Bring a second bread machine to market, only make it bigger and more expensive. So, that’s what they did. Williams & Sonoma’s second bread machine was larger, had more features and was priced higher than $400. It didn’t sell well, either; but that was the plan all along. Suddenly, demand for the original bread machine was so strong that Williams & Sonoma had trouble keeping them in stock. Soon, other manufacturers jumped onto the bread machine bandwagon and an after-market developed for bread mixes and bread machine cookbooks.

The answer to the question “Why did the introduction of a second bread machine cause the first machine to begin selling?” can be found in Social Comparison Theory. Consumers want choices. If you want them to choose your product, give them a choice. If you want them to choose a particular product over others, manipulate the choices you give them.

As MIT professor Don Ariely points out in his book “Predictably Irrational: The Hidden Forces That Shape Our Decisions”, consumers’ choices are often manipulated to produce

the result desired by a retailer. Professor Ariely tells of research he performed using a subscription advertisement for the magazine The Economist. The ad listed three subscription levels for the magazine: Internet-only for $59/year, print-only for $125 per year and Internet and print combined for $125 per year. Ariely gave the ad to 100 students at MIT’s Sloan School of Management and asked them which subscription level they would choose if they were interested in the magazine. Sixteen students chose the Internet-only option for $59; none chose the print-only option for $125, and 84 chose the Internet-and-print option for $125. Which would you choose? I would have chosen the Internet-only because I do most of my reading online anyway, but I can see why most students chose the Internet-and-print option: Given the choices, it’s clearly the better value.

The next phase of Professor Ariely’s research is where the concept really gets interesting. The ad was again submitted to 100 students, but the middle choice — the print-only option for $125 — was eliminated. The only choices were now Internet-only for $59 and Internet-and-print for $125. One would expect that the results wouldn’t be that different; after all, no one chose the print-only option anyway. But the results were completely skewed once the print-only option was eliminated. In the second round, 68 students chose the Internet-only option, while 32 chose the Internet-and-print option.
Why?

Because the print-only option was a “decoy” (sidekick) used to make the Internet-and-print option seem like the best value of all the choices provided. And the tactic worked: Adding the decoy subscription resulted in $11,444 in subscriptions; removing the decoy resulted in $8,012 in subscriptions. Giving consumers the right combination of choices (making one choice clearly the best value) resulted in $3,432 in additional revenue.

Professor Ariely states this tactic as a formula: If you want to sell product A, offer two comparisons: A less desirable product B and a product that is almost as good as product A (but not quite) that we will call product A-minus. Price A and A-minus close enough that product A is clearly the best value. A-minus is the decoy.

If you have a unique item in your store that hasn’t been selling, Social Comparison Theory may provide you with a selling tactic. Display the slow-moving item (A) in a group of three (A, A-minus, and B). Price A and A-minus in such a fashion that A is clearly the better value, and you increase the likelihood that you’ll sell A.

For example, a vintage Gibson Hummingbird guitar (A) priced at $2,500 can be grouped with a Gibson J-45 acoustic (A-minus) priced at $2,100 and an Epiphone acoustic (B) priced at $800. The Epiphone is (to a guitar player) clearly not in the same class as the Hummingbird, so the buyer’s focus shifts to the two Gibsons. When condition is equal, the Hummingbird at $2,500 is a better value than the J-45 at $2,100. The J-45 is the “decoy,” and is priced to make the Hummingbird appear to be the better value. The sidekick (J-45) is there to make the hero (Hummingbird) look good.

Keep the group of three in the same product category and as similar as you can find. The usual variables apply: Condition, rarity, brand, etc. Find a good “sidekick” for your slow-moving items, and you’ll give your customers the choice they need to justify a purchase.

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