The less-is-better effect lets you fake generosity

How can you trick people into thinking you're generous when offering them crap? Just use the less-is-better effect to offer them bonus crap, fungible crap, or a complete set of crap.

It's like when you feel a surge of gratitude when an ice cream seller offers you a little extra scoop on your sundae. But think of how big a regular scoop is before you calculate the total value of the extra. Plenty of companies buy more goodwill with "bonuses" than they would if they just gave people a better deal overall. It's called the less-is-better effect, and it pops up in strange places. One study showed that people felt more gratitude for an overfilled seven ounce container of ice cream than they felt for a correctly filled eight ounce container. The idea that they got more ice cream than they expected, or than they were meant to get, made them happier than getting a genuinely larger amount.

People also felt more grateful for a $45 dollar gift card than a $55 dollar coat - although plenty of people can understand the gap in gratitude around the holidays, when they'd rather get a penny sent to them in the mail than another pair of reindeer socks.

Most strikingly, they were happier with a 24-piece dinnerware set that was intact than a 31-piece set, a couple of pieces of which was broken. The 31-piece set contained all the pieces of the 24-piece set, and all of them were intact. This made no difference to the recipients. All they could see was the loss of the broken pieces.

That being said, the less-is-better effect only stands up under certain conditions. If the options are put right next to each other, the effect disappears, as people see the true value of both. It's just the gifts in isolation that give people a flipped sense of happiness and gratitude. So, if you employ this strategy, don't set up shop next to someone who doesn't employ it.

[Via Behavioral Decision Making]