Seminar Ioannis Evangelidis

Ioannis Evangelidis, Associate Professor of Marketing at ESADE Business School, will present his paper “The Upscaling Effect: How the Decision Context Influences Tradeoffs between Desirability and Feasibility”, joint work with Jonathan Levav (Stanford University) and Itamar Simonson (Stanford University). 

Abstract 

Purchase decisions typically involve tradeoffs between attributes associated with desirability (e.g., quality) and feasibility (e.g., price). In this paper we examine how the decision context impacts consumers’ preference between a high-desirability (HD) option and a high-feasibility (HF) alternative. Nineteen studies demonstrate a novel context effect, the “upscaling effect,” whereby introducing a symmetrically dominated decoy option to a set (i.e., an option that is inferior compared to all alternatives in the set) leads to an increase in the choice share of the HD option. To account for the upscaling effect, we advance a two-stage model of consumer decision-making for decisions that involve tradeoffs between desirability and feasibility. According to our model, when the decision context provides a reason for choosing either option, such as when a decoy option is added to the set, consumers prioritize reasons that support choice of HD options over HF alternatives. Our model can explain the upscaling effect, as well as other findings reported in the literature, such as asymmetric attraction effects (Heath and Chatterjee 1995) and asymmetric sales promotion effects (Blattberg and Wisniewski 1989). Further, the upscaling effect holds important managerial implications because it provides an effective way to increase sales of high-end products.