Psychology
What is The decoy effect?
The decoy effect is when adding a third, less attractive option nudges people toward a specific choice. A cleverly priced 'decoy' makes one of the original options look like a much better deal — a tactic widely used in pricing menus.
See it, don’t just read it.
Watch a 2-minute lesson with voice + animation that explains the decoy effect.
Key things to understand
- 1A third 'decoy' option shifts which choice we prefer.
- 2The decoy makes a target option look like a great deal.
- 3It exploits how we compare options relative to each other.
- 4It's common in pricing tiers and menus.
Frequently asked questions
- What is the decoy effect?
- When adding a deliberately inferior option steers people toward a particular, more profitable choice.
- What's a classic decoy effect example?
- A pricing tier where a 'large' costs nearly the same as a 'medium', making the large look like a steal.
- Why does the decoy effect work?
- We judge options by comparison, so a decoy reframes one choice as clearly superior.