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Try to find a real-world example of the compromise or
attraction effect in an advertisement (include a screenshot, picture, or link for the ad—this does NOT count toward your 600 words). Try to explain the firm’s intent in the ad, and why you think this advertising strategy will or will not work, using the principles from the readings.
reading tips;
Simonson (1989) Choice Based on Reasons: The Case of Attraction and Compromise Effects
[Optional] Shafir, Simonson & Tversky (1993) Reason-based Choice
The Shafir et al. reading describes the important role of reasons (as opposed to values) in decision making processes. These ideas are very important for understanding decision
making broadly, but consumer decision making in particular.
1. How does reason-based choice differ from value maximization? If value maximization is
taken to be normative, what systematic departures from normative behavior are caused by
reason-based thinking?
2. What relationship does mental accounting have with reason-based choice?
3. The Shafir et al. article describes some marketing applications of reason-based choice.
Can you think of others? Consider price guarantees. In its typical form, if a consumer
purchases a product at one store and later finds it for a lower price at another store, the
consumer could return to the first store with proof of that lower price and get reimbursed for
the difference. How do price guarantees exploit reason-based choice?
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