The IKEA effect is that people are more appreciative and tend to overvalue things they have made themselves simply because they participated in their creation.
Recently I wanted to buy a rug for our cat. By chance (very timely) I came across a video tutorial on TicToc for a pretty simple mat with colorful fleece strips. Super easy! After an hour-long marathon of shopping at nearby stores, I went to a fabric store. The result was a rug so beautiful that Anthony Rubio himself would have been proud of me, but I have to admit that I regretted a few times in the process that I just didn’t buy a pre-made rug. It would have been much more convenient to buy all the consumables at the pet store, then I would have enjoyed the creation process, but I would not have had to spend as much time and effort to find all the components. This is what behavioral economists call the Ikea effect.
Recently this effect has become particularly popular and surrounds us at every turn. In the last 5 years, many startups based on this psychological effect have become successful. These include paintings by number, all sorts of constructors and puzzles for children and adults.
Parents also know how this scheme works. No ready-made toy is as fun as one that the baby can make himself. The most obvious example is, of course, Lego blocks, a classic example of how the Ikea effect works for toddlers. Of course, it is fun to play with a spaceship already assembled, but it is more interesting to build the model step by step according to the instructions.
It is on the example of Lego that we can explain why the Ikea effect does not always work. If we offer a 4-year-old child to build a house, following the instructions for a 10-year-old child, it probably won’t be fun, even if the construction can be completed with parental help. Too much effort to assemble the toy, too much time – a fun game turns into a challenge, most likely the assembled toy will go to the basket after a day. At the same time, two plastic hangers clutched together will be the most beloved craft for the next week.
- In this way, one’s own work seems more valuable than that created by someone else, and almost equal in value to that created by experts. However, this effect does not work when the work is too hard or when we spend too much time on it, compared to the expected effect.
The Ikea effect applies not only to toys, furniture, and paintings. It is used successfully in other industries as well, because one’s own contribution to the creation of a product does not necessarily have to mean physical labor, such as screwing in screws or assembling finished elements.
The IKEA effect only shows up when: the result is tangible. “I assembled a closet, there it is in my bedroom, and I am using it.” The work turned out to be feasible in ability and not too easy. You don’t want to set the client too difficult or too easy tasks. The end result should be equal to the expenditure of time and effort, as well as to meet expectations. The degree of compliance can be different. For some, “it’s not crooked, it doesn’t fall apart – it’s fine” is enough, for others, it’s only good if “everything worked out, it’s just like in the photo”.
Research has shown that three factors are needed to achieve the Ikea effect:
- Effort;
- Reflection of competence;
- Completion.
Effort is important, but participants must also be able to complete the task. In studies where participants failed to complete the task, willingness to pay for the item decreased. When they built a project and then had to take it apart, there was no Ikea Effect either.
How to achieve the Ikea Effect in different areas:
- Get people to interact with the product. For example, app developers are encouraged to provide sample data, pre-filled defaults, and templates that can be edited so that people can put effort and creativity into creating their account.
- Give customers the ability to customize your product. For example, Nike allows customers to create their own sneakers. Customers can choose colors, seams, and features. And they’re willing to pay twice as much for a product like this!
- Ask for customer feedback, suggestions and ideas. Then customers will make the effort to answer your questions, feel that their opinions are valued, and feel a greater attachment to the company.
- Offer an experience that is challenging, but not too challenging. If your product already requires some effort, such as having to fill out a form to sign up for a program, make sure it doesn’t take too long for the person to complete the task.
- Add some creativity. A study by Dahl and Moreau (2007) shows that customers are more satisfied when there is a limited amount of creativity they can exercise when interacting with a product.
An example of using the Ikea effect in content creation. People like the content they create. User-generated content is an easy way to engage customers and build brand loyalty. Engage customers by getting their feedback, co-creating content, tagging them on social media, letting them vote on the content they create, encouraging them to leave reviews and recommendations. Promoting this type of content is easier because of the audience’s sense of personal connection to the story you’ve written, which you usually want to share afterwards.
Tips for business:
- Make your team matter. Giving people on your team a voice and permission to participate in the decision-making process means that they will become attached to the company and perform better.
- Don’t hesitate to ask new employees for their opinions and give them opportunities to contribute. The sooner they get involved in the work processes, the sooner they will feel that the work is valuable to them.
- Don’t underestimate crowdfunding platforms. They don’t just raise money-they make people love the product before it even comes out.