Thread by @luv1oh1

THE DECOY EFFECT IN MARKETING

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

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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)

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#Marketing #marketingtips