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What is the Decoy Effect?

 , updated on December 10, 2016
The decoy effect is a well known tendency for the presence of a bad choice in a list of options to influence decisions. For example, marketers may design a price list to include options that are obviously a bad deal. This often results in a higher conversion rate as customers see the bad deal and choose the better deal thus generating higher confidence to make the purchase.
Overview: Decoy Effect
TypeCognitive Bias
DefinitionThe tendency for the presence of bad choices in a list of options to direct behavior.
ExamplePrice List
2 for $4
4 for $16
10 for $20
Related ConceptsPricing Strategy

Cognitive Biases

This is the complete list of articles we have written about cognitive biases.
Ambiguity Effect
Anchoring
Backfire Effect
Base Rate
Biased
Biases
Circular Reasoning
Cognitive Bias
Cognitive Dissonance
Complexity Bias
Crab Mentality
Creeping Normality
Curse Of Knowledge
Decoy Effect
Ethnocentrism
False Analogy
False Hope
Fear Of Youth
Golden Hammer
Halo Effect
Hindsight Bias
Negativity Bias
Optimism Bias
Peak-End Rule
Positive Bias
Sour Grapes
Survivorship Bias
Us vs Them
Victim Mentality
Wishful Thinking
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