Don’t Make Your Cake and Eat it Too
As I’ve discussed in the preceding article, linked here, The “IKEA Effect,” as described in a 2011 study from Harvard Business School, linked here, suggests when our labor results in a successful completion of a task, we tend to value the fruits of our labor more than if the task was not completed.
Companies take advantage of this psychological effect and profit off of you doing the work for them!
Think of the last time you went somewhere and had a great experience.
Did you go out to eat at a restaurant? Did they have you pick your garden salad from an actual garden out back? Did you have to wash your plate when you finished?
If your answer is no, you were probably not taken advantage of when it comes to the IKEA Effect.
The paper on the IKEA Effect suggests other examples of products we produce that increase our valuation of an experience. These include baking a cake from boxed cake mix, building your own Build-a-Bear and so called “haycations” where a consumer harvests their own food during their stay on a farm.
This is an interesting trend because people are paying for experiences that otherwise would have been done by a paid employee. In other words, the cake mix is already made, one simply assembles and bakes. The Build-a-Bear is stuffed and essentially made by the consumer. The farmer gets out of harvesting crops by charging customers to pick their own food for their own consumption!
Some other common experiences that profit off of an idea similar to the IKEA Effect are apple and pumpkin picking, or any other fruit picking activity where you get to take home the literal fruits of your labor, a zoo or safari where you get to feed the animals, rental bikes or golf carts, to name a few examples.
In these examples, the consumer picks the fruit and takes it home, and pays the establishment to do something that otherwise would have been its job, and usually for an overpriced charge compared to simply buying the produce at the grocery store. The consumer takes on the role of the zookeeper and feeds the animals along their journey. The same is the case with rental bikes, you pay for the bike, but end up putting your own body to work to use the bike as it is intended.
And, of course, the place that inspired it all, IKEA!
Although a more economical option for furniture, IKEA traps consumers into a sort of DIY buzz. “Some Assembly Required” means the consumer will have to utilize their own labor to complete the project, and if it is completed successfully, the consumer will find great pride in the piece. This creates a bond between the material object and the consumer because, psychologically, successful self-made projects receive a higher valuation than products did not require one’s own labor to be at work to obtain a finished product.
I’ve heard that the secret to happiness is buying experiences, not material objects. And I’ve noticed, especially among my affluent friends and older relatives, that buying gifts for them is difficult because they have everything already. If you’d like to read about tips for buying for the person who has everything click here.
The IKEA Effect and companies that utilize it profit off of these experiences because we are drawn to them. This is either out of socialization that experiences will make us happier compared to material goods, or because the experience leads to a material good produced by our own hand that makes us feel good about ourselves and our place in the world.
We should be mindful of business models that require us to put the work to obtain a product because these models prey off of our inevitable psychological processes.
Sure, if you engage in an experience that is likely to initiate the IKEA Effect, you might have a great time and add some variety to your life, but paying attention to psychological marketing tactics and business models can save you money in the long run.
