Shot #16 : The Decoy Effect in Marketing

Hi there,

I wanted to share the Decoy Effect in today’s shot.By definition, The Decoy Effect is a cognitive bias in which consumers will tend to have a specific change in preferences between two options when also presented with a third option that is asymmetrically dominated.Let me explain this to you with an example.You go you for a movie. Assuming you enjoy munching popcorn while watching your favourite movie. You see the following two popcorn sizes.

You’re most likely to buy the small size because your brain tells you that small size is reasonable while the other is expensive.If the cinema hall has the following 3 popcorn sizes

You’re most likely to buy the Medium size because your brain tells you that Medium size is reasonable.

Simply put, when there’s a 3rd expensive choice (the decoy), then you're likely to choose the more expensive of the remaining two options.We experience this effect in our everyday life. Few more examples:-Smartphones are launched in 3-4 variants (16gb, 32gb, 64 gb etc.)-Burger and pizza outlets offer 3 sizes (small, medium & large)

If you liked what you read, please spread the word by sharing this post on any of your social media profiles. It will keep me motivated to write more such “marketing shots” for YOU :)  

Thanks,

LuvCo-founder ExperienceSaga.com(About Me)

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