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What is the IKEA effect?
Thanks for asking!
You're no doubt familiar with IKEA as the king of flat pack furniture, but you may not be aware that the Swedish company's name is also associated with a cognitive bias.
It's all to do with how we assign greater value to objects when we make or assemble them ourselves.
Now that might seem counterintuitive, but it's become an established marketing tactic over the years.
Studies by American researchers Michael Norton, Daniel Moshon and Dan Ariely backed it up with evidence.
When the team released their findings, they coined the term IKEA effect to describe the bias.
What was their evidence?
They ran a series of tests to find out if their belief in the IKEA effect was well-founded.
One part saw test subjects divided into two groups.
The first group was tasked with assembling IKEA furniture items, while the other group simply examined the same items which had been pre-built for them.
Both groups then had to put a price on the furniture, and the results were striking.
Those who had assembled the furniture themselves valued the items 63 higher than those who had received pre-built versions.
We want to pay more for doing more work ourselves.
That's the fascinating reality of the IKEA Effect, and there are actually three cognitive principles behind it.
The first is our need for competence, which means we satisfy a cognitive behavioural need when we contribute to completing a task like assembling an IKEA furniture item.
The second is effort justification.
We've worked hard on building that piece of furniture and it's satisfying feeling that hard work led to something valuable or useful.
And finally, the endowment effect.
We feel greater ownership over items we make or assemble ourselves, which also explains why we tend to assign them greater value than other people would.
That's true even when the creations aren't customised in any way, like with IKEA furniture or a toy Lego set, for example.
Does the IKEA effect come into play in other areas of life?
Have you ever seen a work colleague fail to recognise that a project just isn't delivering results, despite it being patently obvious to everyone else?
Well, if that person worked really hard on the project or perhaps it was their idea to start with then the Ikea effect may have something to do with it.
Likewise, if you know someone who's really good at arts and crafts but no one's buying their products on Etsy, it might be because they've priced them too high, because of overvaluing their own creations.
Finally, and this is a common one, pretty much all parents see their kids as best in their school class or in other areas of life.
Maybe you've found yourself in one of those situations.
Well, next time, bear in mind the subconscious IKEA effect and try to counteract it by discussing the situation with someone who's not so personally invested in the outcome.
There you have it.
Now you know what the IKEA effect is.
In under three minutes, we answer your questions and help you understand the true meaning behind the trends, concepts and acronyms that are making headlines.
Listen along and you will really know for sure.
