The Decoy Effect: Marketing’s Most Subtle Mind Game
- Amelia Er
- Oct 29
- 5 min read
Key Takeaways
Marketers use the Decoy Effect as a subtle way to guide consumer choices.
Common examples include café drink sizes and streaming plan tiers.
The goal isn’t to deceive, but to nudge consumers toward a preferred option.
That “Too Good to Be True” Deal
If you have ever subscribed to a streaming platform, you know the struggle. Imagine staring at the “Basic” plan on one side and the “Premium” plan on the other, your mind would start running through all the possibilities:
“Which one gives me more value?”
“Do I really need Ultra HD?”
“For just a little more, I can get all these extra perks?”
After going back and forth, you eventually pick the option that feels like the smartest deal.
But here’s the thing: that choice might not have been entirely yours. It could have been a decoy, a clever pricing strategy designed to gently guide you toward a more expensive plan without you even noticing.
It’s subtle, effective, and used by marketers everywhere.
What the Decoy Effect Actually Is
This method is widely used around the world, and to them it is better known as the Decoy Effect.
The Decoy Effect is a psychological phenomenon where consumers shift their purchasing decisions when a third, less attractive option is introduced. In simple terms, a decoy option is added not to be chosen, but to make another option look more appealing by comparison.
For example, imagine you are at a café choosing your drink size:
Small — RM6
Medium (Decoy) — RM9
Large — RM10
Initially, many people might go for the Small size to save money. But once the Medium at RM9 enters the picture, the Large at RM10 suddenly looks like the smarter deal, just RM1 more for more coffee.
This is not magic. It is smart psychology at work. By shaping how choices are framed, marketers can gently nudge customers toward the option they want to highlight without saying a word.
Why It Works So Well
The Decoy Effect can influence us more than we realize. As humans, we love feeling like we’re making smart, well-thought-out choices. But in reality, what feels like a “smart decision” is often a clever trick marketers use to guide us toward the option they want us to pick.
One reason it works so well is that we naturally look for shortcuts when making decisions. The decoy acts as a mental nudge, making one option stand out as the better deal, which gives us more confidence in our choice.
We also tend to compare options side by side rather than judging their true value on their own. This makes the decoy incredibly powerful because it quietly shapes how we see the other choices and makes the target offer look like the obvious winner.
In short, a well-placed decoy doesn’t just influence your decision, it makes the choice feel like a no-brainer.
Real-Life Examples You’ve Probably Fallen For
Ever wondered if you’ve ever fallen for the Decoy Effect without even realizing it? Chances are… you probably have. In fact, we all have, and that’s exactly why this method works so well. Here are two everyday examples that might make you go, “Wait… I’ve actually picked that before.”
Example 1: Skincare Products Bundles
Imagine you’re shopping online for a Vitamin C Serum and you see these three bundle deals:
1 bottle — RM79
2 bottles — RM150
3 bottles (Decoy) — RM230 ➝ marked with “Best Value”
If only the first two options existed, many shoppers would naturally go for the cheaper one.
But here’s the trick: when the third option is added, it suddenly makes the second one look less appealing. For just RM80 more, you get an extra bottle and that shiny “Best Value” label screaming at you.
So, what happens?
A lot of people end up choosing the 3-bottle option, thinking they’re getting a smart deal… when in reality, it was designed to nudge them there all along.
Example 2: Streaming Service Plans
Now, let’s say you’re signing up for a streaming service. You see three plans:
Basic Plan – RM10/month (1 device, no HD)
Standard Plan (Decoy) – RM17/month (2 devices, HD only)
Premium Plan – RM20/month (4 devices, HD & Ultra HD)
If only Basic and Premium existed, most people would likely stick with Basic, because Premium seems like a big jump in price.
But once the Standard Plan is added, Premium suddenly looks like the smarter deal. The deal is only RM3 more but offers way more features.
So, what happens?
Many people will fall for the Standard Plan, which is the decoy, and eventually choose the Premium. That decoy is placed there to make Premium look like a no-brainer.
How You Can Use It Too (Without Being Shady)
Now that you know what the Decoy Effect is, let’s walk through a simple step-by-step guide to creating one the right way to level up your marketing game ethically.
Step 1: Pick the target offer
Start by choosing the option you actually want customers to go for. Among your existing prices or offers, identify your “main” one. This will be the one your decoy helps to shine.
Step 2: Design a strategic decoy
A good decoy isn’t just about price. Think about features, timing, and even layout, this could be anything that can subtly make your target offer look more attractive by comparison. In short, your decoy should look close enough to be considered, but not good enough to be chosen.
Step 3: Position and price effectively
Where you place your decoy matters just as much as what it offers. People tend to compare options that sit next to each other, so make sure your decoy is positioned near your target offer. That’s what triggers the “this one looks like a better deal” moment in your audience’s mind.
💡 Bonus tips to keep it ethical and effective:
A/B test your offers to see what really works.
Choose the option you genuinely want customers to pick.
Design your decoy to highlight that offer’s value, not trick people.
Don’t clutter, too many choices kill clarity.
Test and tweak to see what clicks.
When put to use, the Decoy Effect can do more than just act as a decoy. It’s a clever strategy that marketers use to gently guide customers toward the option they want them to choose. Remember, it’s about guiding, not tricking.
Now that you know how it works, why not give it a try in your own marketing game? Test it out, tweak it, and watch how a simple shift in choice design can change the way people decide.
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