Imagine you’re at the movie theatre. You’re lining up to get popcorn and you’re presented with two options: You can get a small for $3 or a large for $7. Which one do you choose? What if we change the menu? Now you can have a small for $3, a medium for $6.50 or a large for $7. If that large now looks like a better deal, you’ve fallen for the Decoy Effect. This is a behavioural phenomenon in which our perception of a decision changes with the introduction of a third option that is similar but inferior to the others. It really works. The National Geographic TV show Brain Games ran this exact experiment with real movie goers. At first, most people felt the large was too expensive and chose the small. However, when a middle option was introduced, most participants upsized to the larger order. When asked why, one person said it was just “more value.” Decoy Effects are often used by marketers to nudge people into spending more than they intended to — after all, it’s just a few cents more.
Use this knowledge Next time you’re shopping for a purchase and you see one option that just seems ridiculous, don’t feel fooled. The store probably isn’t banking on you buying the pricey decoy, they’re banking on you getting the slightly pricier alternative that now seems like a bargain. One tactic that works: Think about what you really want before you even step foot in the store. That way you’ll only be spending money on things that you actually want and not making your decision based on the options available.
Saving with Evree is simpleSign Up