When negotiating, you’re trying to persuade others to reach a deal that’s mutually beneficial. If you’re regularly trying to influence but failing to succeed, a psychological concept about judgement bias called the dilution effect could be partly to blame.
This effect has been seen in all kinds of situations, from the way we stereotype people, how we decide which products to buy, and how well we negotiate and persuade. By understanding it, you can strengthen the delivery of your arguments and improve your negotiation skills in daily life.
What is the dilution effect?
The term was first used by Richard E. Nisbett, Henry Zukier and Ronald E. Lemley. These scientists found that participants in a research study made less extreme judgements about other people when presented with more information. Since then, it’s been observed as an influence in purchasing decisions and marketing campaigns, too.
The dilution effect is best illustrated with an example from a study by Craig McKenzie, Susanna Lee and Karen Chen. Imagine a defendant, John Smith, on trial for robbing a bank.
- The prosecution’s first witness is certain she saw John Smith rob the bank, and delivers her case with confidence.
- The prosecution then calls a second witness, who says they did not get a clear view but thinks they saw a male of John Smith’s height and build rob the bank.
Although the statement given by the second witness is weaker, it should increase belief in John Smith’s guilt, as the description still fits John Smith and reinforces the statement made by the first witness. However, the study found adding a weaker witness statement reduced the impact of the stronger witness statement and lead to fewer judgements of guilt.
Why does the dilution effect occur?
To understand why this happens, we need to understand what happens when we are trying to evaluate something – be it which brand of cleaning wipes to buy, who to hire for a job, which hotel to book for a trip, or any other evaluations in our daily life. Our minds utilise two categories of information: diagnostic and non-diagnostic.
- Diagnostic information is information that is directly relevant to the evaluation being made.
- Non-diagnostic information is the non-consequential, irrelevant information often presented at the same time.
When both categories of information are mixed together, the dilution effect occurs. Our brains don’t add up the arguments or information we are given. Instead, they treat the information as an average; the weaker, non-diagnostic information dilutes the value and weight of your strongest point.
When does the dilution effect happen in day-to-day life?
You’re experiencing this effect subconsciously in your daily life far more often than you realise. Let’s look at another study, this time from Christopher Hsee. Imagine you are looking for a new dinnerware set in two separate scenarios:
- In Scenario 1, you find a dinner set with 8 plates, 8 bowls, and 8 dessert plates. All items are in good condition.
- In Scenario 2, unaware of the previous set, you find a set that includes all of the previous items identically. Plus 8 cups (2 of which are broken) and 8 saucers (7 of which are broken).
Participants in Hsee’s study were willing to spend double the price for Set 1 compared to Set 2. This is despite the fact Set 2 includes exactly the same items plus 6 extra cups and a saucer. The broken items dilute the perceived value of the entire set.
Every time you’re evaluating anything (products, locations, even people) the dilution effect is coming into play within your subconscious.
Using the dilution effect to advantage
By understanding how and why the dilution effect occurs, it’s possible in some situations to use it to an advantage. For an example of this in action, look no further than North American pharmaceutical adverts.
Ever wonder why, at the end of the advertisement, a hurried voiceover will tell you this great new medication has side effects that include mild back pain, heart attack, stroke, drowsiness and itchy feet?
By including more information and less significant side-effects, the impact of the severe side-effects (heart attack, stroke) is lessened. The same drug that only mentioned side effects of heart attack and stroke would be perceived to be considerably more dangerous.
When you need to persuade, quality beats quantity
The dilution effect is seen in so many different situations – and is even present in negotiations. When you’re trying to influence people, the dilution effect shows quality is more important than quantity in your arguments. By increasing the number of arguments you make, you could be actively weakening your case.
The next time you want to speak up in a meeting, make a persuasive point, or negotiate the terms of a contract, the delivery of your message is even more important than the content within. The more information you include, the more you’ll dilute your strongest arguments. Focus on delivering the best information well, and see how your next negotiation improves.
For more information on this cognitive quirk, you can watch this TED Talk by our Senior Advisor, Niro Sivanathan.
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