Place Discounts Next to Dissimilar Products
A new study shows that customers are more likely to buy dissimilar products that are next to a discounted product.
Discounts capture attention.
And they push attention toward surrounding products.
If adjacent products are similar, they seem worse compared to the discount.
But if they're dissimilar, it doesn't matter. Yet these products are now being evaluated because of their heightened visibility, so customers are more likely to buy them (Kan, Liu, Lichtenstein, & Janiszewski, 2023).
Suppose that you're selling a new product (e.g., oat milk). Most customers won't actively seek your product so you need to grab their attention. If you can't discount your product, place it next to a sale item (e.g., regular milk) to penetrate their consideration set.
Or suppose that you're choosing the location of a discounted product. You might place a discounted yogurt in the middle. A similar yogurt on the left would suffer, while a dissimilar yogurt on the right would benefit (see opening image).
But imagine the discounted yogurt was positioned on the left. You still lose sales of the similar yogurt in the middle, but you no longer enjoy a sales boost of the dissimilar yogurt that has moved further away toward the right.
Or imagine the dissimilar yogurt was positioned in the middle. You might boost sales of this yogurt while preventing a sales loss from the similar yogurt:
Just be cautious. In some cases, your assortment might be less organized.
The Takeaway: Place discounts next to noncompeting products to push these nearby items into the consideration set.
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