20 · Deciding
Decoy Effect
Add an option that's clearly worse than one of the others, and more people pick the one it makes look good.
Evidence: Holds, with limitsWhat we do with it
- 01
Know it so you can spot it, in your own pricing and in a competitor's.
- 02
We don't build decoys. Every plan we design has to be a fair pick for someone.
- 03
If one plan makes another look pointless, fix the lineup instead of leaving it as a quiet nudge.
Examples
Getting it wrong, getting it right.
Don't
Three plans where the middle one costs nearly as much as the top one and offers half as much, there only to push people up.
Do
Three plans that each fit a real kind of customer, with the differences in plain words.
The evidence
What the research says.
Strong in the lab, weaker in real life. When Shane Frederick, Leonard Lee and Ernest Baskin tried to repeat it in 2014 across 38 studies with realistic choices, the decoy rarely worked unless the options were described with numbers. When people could taste, touch or see the options, it did nothing, and sometimes it backfired. Sandra Milberg and colleagues' 2014 synthesis of the field landed in a similar place: decoys that were real options in their own right reversed the effect, and it may not carry far outside the lab.
How our view changed
We explain it so clients can recognize it. We don't use it: it's on our list of lines we don't cross.
Sources
- Huber, J., Payne, J. W., & Puto, C. (1982). Adding asymmetrically dominated alternatives: Violations of regularity and the similarity hypothesis. Journal of Consumer Research, 9(1).
- Frederick, S., Lee, L., & Baskin, E. (2014). The limits of attraction. Journal of Marketing Research, 51(4).
- Milberg, S. J., Silva, M., Celedon, P., & Sinn, F. (2014). Synthesis of attraction effect research: Practical market implications? European Journal of Marketing, 48(7/8).
Last reviewed November 7, 2026. How we keep this current