One such technique is known as the ‘Goldilocks Effect’ (or ‘Goldilocks Pricing’). The term derives from the Brothers Grimm tale in-which Goldilocks eats three bowls of porridge; the first being too hot, the next too cold, but the final one “just right”.
The goldilocks effect describe the practice of providing a premium as well as a budget option alongside a regularly priced product to make the latter seem more appealing. A good example of this is present in most mainstream coffee shops where the options range from small to large, with regular in the middle. The goal of this type of pricing is to push people who might usually buy the cheapest into buying the more expensive option.
This method of effecting behaviour exploits our psychological aversion to extremes, manipulating people into choosing the option that yields the greatest profit by providing three options and placing the most profitable item centrally within the range.
Below are 24 examples of the goldilocks effect in action.
Although in the story Goldilocks is confronted by 3 options the pricing pattern doesn’t necessarily have to be limited in the same way. It does, however, make sense to limit the options to lessen the chance of overwhelming the customer while also providing enough choice for the technique to work. The following examples keep it simple, providing only a minimal number of choices.
When the range of products or services exceeds 4 placing them side by side and comparing price and benefits/features (as above) seems the best solution, however, there is a danger that customers will be overwhelmed by choice.
Although the above examples arguably provide too much choice visually a couple of them deal with it nicely by highlighting the preferred option. Sites like Basecamp do this beautifully. The choices are kept to a minimum, the preferred option is given prominence and, in the case of Basecamp, it’s also highlighted as the most popular or best value.
This post was written by Paul Seys, an experienced Interaction Designer and Head of User Experience at Redweb a digital agency based in the United Kingdom. Paul regularly writes for his blog shortboredsurfer.com. Follow him on twitter @paulseys.
Have you had any experience of the goldilocks effect that you’d like to share? Or maybe you have some good examples of it in action that we might have missed? Let us know in the comments section below.