What Is the Decoy Effect in Menus

Here's the classic example from a subscription experiment. People were offered three options: the digital edition only, the print edition only, or both together. The print edition alone cost exactly as much as both together, so choosing it made no sense under any circumstances.

And no one chose it. But while it was on the list, an overwhelming majority picked the bundle: next to the pointless option, it looked like a gift. Remove the decoy, and people's choices shifted sharply toward the cheaper option.

The difference is huge, but only the makeup of the list changed: neither the price nor the product itself was touched. The decoy sells nothing; it sets the frame of reference in which one of the real options starts to look like a good deal.

On a menu, it's the most expensive dish, ordered by only a few people. It's not there to sell; it's there to make everything else stop seeming expensive. Remove it, and the next-most-expensive dish becomes the priciest on the list, so it will be chosen less often.

With pricing plans, the decoy is usually in the middle: it's priced almost as high as the top plan, but offers noticeably fewer features. Comparing it with the decoy makes the top plan look like an obvious choice, even though without it, it would simply look expensive.

The same trick works with movie-theater popcorn and coffee sizes. The medium size often exists not for its own sake, but to make the large look like a better deal: the price difference between medium and large is deliberately made small.

Awareness helps only a little: comparison happens faster than reflection. It's more reliable to change the order of your actions: decide what you need before you see the list of options, then look for it on the list instead of choosing from what's offered.