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The Decoy Effect: How Marketers Influence You to Spend More

Ever wonder why the large popcorn seems like such a better deal? We have answers!

Credit: Pikrepo

It’s Saturday night and you want to see a movie. You go to the theatre and you’re not very hungry, but you do want some popcorn. You can get a small for $3, a medium for $6 or a large for $6.50.

You get the large, even though you probably won’t eat all of it—it just seems like the best value for your dollar.

This is all due to a marketing strategy called the ‘decoy effect.’

The medium popcorn is on the menu to convince you that the large is a better deal—it’s a decoy. They don’t want you to purchase a medium popcorn, it’s just there to make the large seem like a better deal.

Marketers use this strategy all the time to influence people’s preferences. While a buyer could purchase the cheapest option, the decoy makes the more expensive choice seem like the more valuable one.

A study done by the University of British Columbia put this effect to the test.

They looked at an online diamond retail site, which employed the use of decoy diamonds. These worse diamonds were priced the same as better diamonds to try to get more people to purchase the better ones.

The results showed that the decoy diamonds led to a significant increase in purchases of the better diamonds. The ‘decoy effect’ increased profits by 21%.

This effect can apply to tons of different things. The price of your morning coffee, your phone plan, or even the Christmas presents you’ll be buying for your family. Pay attention, see what you find!  

And while we’re on the subject of Christmas…check out what else we have to say about the holidays here

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