Case file
Decoy Effect
- Filed under
- Need To Act Fast
- Also recorded as
- asymmetric dominance effect
The charge
Adding a third option that is clearly worse than one option can shift people toward that favored option.
How it operates
Choices are judged comparatively, so an asymmetrically dominated option makes one alternative look better without changing its absolute value.
Logged incidents
- Incident 01
A SaaS pricing page adds an overpriced middle tier to make enterprise look attractive.
- Incident 02
A job package includes a weak bonus-heavy offer to make the stock-heavy offer seem better.
- Incident 03
A retailer adds a dominated bundle to steer customers to the preferred SKU.
What to watch for
You may be in it when your preferred option changes because a clearly inferior option appeared. Ask: 'Would I pick this if the decoy disappeared?'
Recommended action
Compare options pairwise and audit menus for dominated alternatives before choosing.
Known associates
- System JustificationPeople tend to defend existing systems and arrangements as fair, natural, or necessary even when they are…
- Reverse PsychologyPeople may choose the opposite of what they are pushed toward, simply to reassert autonomy.
- ReactanceWe push back when we feel our freedom to choose is being limited.
- Social Comparison BiasWe evaluate ourselves and our choices relative to nearby others, often letting status comparisons outweigh…
- Status Quo BiasWe prefer the current state or default, even when better alternatives exist.
- Overconfidence EffectPeople's confidence in their judgments often exceeds their actual accuracy, especially for predictions,…
Source of record