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Imagine you’re a real-estate agent showing a house with a spectacular view. Because a foggy day obscures the vista, you can’t use it to seal the deal. If you say something like, “Usually this is an amazing view. Too bad it’s foggy,” you may just shoot yourself in the foot.
That’s because you’d be pointing out something the buyers don’t know they’re missing and perhaps highlighting a negative, according to China Europe International Business School’s Xilin Li (a recent graduate of Chicago Booth’s PhD Program) and Booth’s Christopher K. Hsee and Ed O’Brien. They call such comments upward counterfactual information, or UCI. In a series of eight experiments, they find that sellers often want to present UCI, but doing so mostly backfires on them by highlighting a current imperfection.
As the sales agent, you have more knowledge than the potential buyers—it’s easy to call to mind the view on its best day. The buyers, however, only know how the house feels in the moment. “To experiencers, the foggy view may look perfectly fine because they do not know the better alternative,” the researchers write. They find evidence that this difference in mindset can lead sellers to give UCI that might damage consumers’ assessment of a product.
In the experiments, the researchers varied the products available, from plants to local cuisine to a view of the northern lights. In their first study, they assigned participants to one of two groups: presenters and experiencers. Both were shown a photo of a bird-of-paradise that was a little wilted. Presenters had the choice of simply saying, “The plant is called bird-of-paradise. It is easy to care for and will add style and vitality to any setting.” Or they could add this UCI to their message: “Unfortunately, the plant looks a bit withered now due to insufficient sunlight. It would look fresher and livelier if it received sufficient sunlight.” The experiencers were told they had $2 to either keep or spend on the plant. Almost 60 percent of the presenters chose to convey UCI. In those cases, the experiencers were less likely to choose the plant.
Acknowledge what’s obvious
If you’re a consultant giving a presentation but notice some distorted slides, should you mention them? In an experiment, participants asked to play this consultant role received more favorable reviews if they didn’t bring up the slides so long as the distortion was subtle—but when it was obvious, they were better off mentioning it.
Subsequent experiments put presenters in the shoes of the owner of a local seafood restaurant, a northern-lights tour guide, a gift giver headed to a birthday party, and in a range of other situations. In each case, more than 80 percent of presenters chose to convey UCI. Those on the other side of the exchange reported a more negative experience when getting UCI. In the case of the seafood restaurant, most of the experiencers who were told that the Alaskan crab was better in winter than in summer said they would give the restaurant a lower Yelp rating and leave a smaller tip.
In other experiments, the researchers find that a consumer with greater knowledge of a product is likely to more easily envision it in a more appealing condition and tends to be less negatively affected by UCI. “Our findings suggest that marketers should be sensitive to both the consumers’ knowledge and the severity of the current imperfection when deciding whether to share UCI,” the researchers write. UCI may deter a consumer who is unaware of the possible variance in the product, the researchers conclude.
But transparency might be valuable when a current imperfection is obvious. For example, most presenters who imagined they were giving a business presentation with seriously distorted slides due to a faulty laptop chose to communicate that the computer was acting up. That kind of UCI gave experiencers a better impression than when it wasn’t communicated because experiencers had already noticed the distortion before receiving information about it.
While people marketing a product generally view it from their own perspective, a better strategy is to consider it from the consumers’ point of view and evaluate whether an imperfection is obvious, the study suggests. In general, the researchers advise that marketers be careful about communicating UCI. If they accidentally share some, the researchers say, they can reduce the damage by providing a vivid simulation of the upward version, such as a video of the view on a clear day or a photo of a lively, fully bloomed bird-of-paradise.
Xilin Li, Christopher K. Hsee, and Ed O’Brien, “‘It Could Be Better’ Can Make It Worse: When and Why People Mistakenly Communicate Upward Counterfactual Information,” Journal of Marketing Research, April 2023.
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