The Unit Effect
12
The Unit Effect Why we get tricked and how to protect yourself
Transcript of The Unit Effect
The Unit EffectWhy we get tricked and how to protect
yourself
Quick!
For the same price, is a 108
month warranty or a nine-
year warranty for a fridge
more worth it?
Really?
O Both durations are exactly the same!
O However, a study by the Journal of
Consumer Research shows that many
consumers believe that 108 months is
more than 9 years
108 Months 9 Years>?????
Why?
O Qualitative data can be manipulated to
appear greater or less than it actually is to
the untrained eye
O ‘Bigger’ numbers does not actually mean
more nor does ‘smaller’ numbers mean
less
What is Qualitative data?
O Items are categorized in terms of informal
or relatively ill-defined characteristics
E.g. Warmth and flavor
Opposite: Quantitative data or Numerical data
Data measured or identified on a numerical scale.
Numerical data can be analyzed using statistical methods, and
results can be displayed using tables, charts, histograms and
graphs.E.g. The temperature at 5.27 p.m. was 22.4° Celsius
The ‘Unit Effect’
O This is the name given to the fatal error
where people assume that
O Higher numbers represent bigger
quantities
O And lower numbers represent smaller
quantities
Why?
O People typically fail to realize that the unit
of quantitative information is arbitrary
O They just focus on the number of scale
units used to determine how much or how
manyArbitraryadjective / ä̍rbiˈtrerē/
Based on random choice or personal whim, rather than any
reason or system
Abuses
O Marketing Advertisements
O Only $2.50 per day for 3 years!
O Or $2737.5
O Statistics in presentations and proposals
O People subconsciously believe that the
difference between 9 and 9.5 out of 10 is
less than 90 and 95 out of 100
Counters
O The study also shows that the moment we are reminded of the relations between units such as 31 days is 1 month, the ‘unit effect’ no longer works
O Have a good understanding of units and conversion
O Be wary of too good deals or too perfect statistics
O Ask yourself questions and try to see the numbers in a different unit
Reflections
In our daily lives, we are often misled by
these ‘tricky’ numbers in advertisements.
We must take care when purchasing
merchandise, whether we are spending $1
or $1000. Just a quick mental check can
save you quite a tidy sum of money. Think
twice before you spend.
SourcesO https://www.jcr-
admin.org/files/pressreleases/021411153938_Pandelaererelease.pdf
O http://money.bundle.com/article/how-larger-numbers-trick-us-spending
O http://arstechnica.com/science/news/2011/02/students-think-that-bigger-numbers-must-mean-something.ars
O http://www.truthpizza.org/logic/stats.htm
O http://t1.gstatic.com/images?q=tbn:ANd9GcRTf1cA_wW2RTO1hhT3Ci5YRn822wuitgyqvqO4R4rjjn-VNaEG1w
O http://t1.gstatic.com/images?q=tbn:ANd9GcSRtF5nAUnYA6tIQzYwnCS7PtDvFGtALvFkocdj8-7yUXQTPheq
O http://t1.gstatic.com/images?q=tbn:ANd9GcR3Xz1JgElgTYPl_1XWaQLS3sDnearjo3wmd7PoOWYwp06jEnG2
O http://t3.gstatic.com/images?q=tbn:ANd9GcRux-VsE7a1ZTS9pltmKTx3tEnqoZ595xfVzjeIHpGhrxZYRnDMrg
The EndThank you
