The Ikea Effect

There is a psychological phenomenon that occurs when a person is involved in the creation of a product. When someone has made or otherwise created this product, they have a strong attachment to it, like it more, and also state that they would be will to pay up to 50% for this product than someone who did not create it would pay. This effect is the Ikea Effect. This effect occurs, as humans get high satisfaction and perceived reward from self-competency, and the feeling of accomplishment. 

The Ikea Effect has an impact on the customer’s satisfaction in your product, and therefore are likely to have a high perception of your business, and more likely to buy from you again, as they see their product as high quality.

There are many examples of businesses and products that take advantage of this effect to drive sales. The first and most obvious being Ikea themselves. Their brand is synonymous with cheap, flat-pack furniture. However other examples include Build-A-Bear in which children can customise their bears as well as help to stuff and create them. Finally is customisation. Many products offer customisation but a common one is with shoes. By allowing customers to customise their shoes, they feel that they have contributed to its creation and the effect is invoked. 

So, it is clear that selling products that are self assembled or customisable is a significant way to boost reputation and customer relationships. But why, if that is the case, doesn’t everyone sell DIY products? Well that is because the Ikea Effect only occurs AFTER the product has been made. Only the actual act of making the product will cause the customer to view it in such a positive light. Many customers state that they would rather pay a higher price for a pre-made product than something they have to put together themselves. This is an obvious hurdle to the benefits of the Ikea Effect. So how do you overcome them?

There are two main methods of convincing customers to buy DIY products, the first being faster delivery. The main factor in customers purchasing pre-made rather than self-assembly products, is the time factor. So, why not balance the time it takes to build the product by offering next day or shorter delivery times on these products. It may help to convert people to DIY that should result in a positive business perception! The second solution is customisation. People love customisation and changing a product to fit their unique needs or style. But, as we previously mentioned, customisation invokes the Ikea effect, so if you are struggling to convince customers to buy DIY products, or even your products cannot be made at home, then why not offer customisation on your ready-made products. This should allow the Ikea Effect to take hold, without the customers feeling that they are compromising on time or quality, as may be the case with self-constructed products.

-- From Marketing to Mind --