Decoy Effect trapped you here!



            There are 2 categories of people who go for a movie. First are the people who like movies and the second (I am pointing a finger at me) who loves popcorn. Seriously, “Harshada is watching a movie.” is an incomplete sentence. “Harshada is watching a movie with popcorn.” this one is a complete sentence.

            So as always I pushed one of my friends at the half time of the movie to buy popcorn for me. This time more than a popcorn I was interested in his behavior because I want to see how he got trapped in a Decoy effect.

            I know you are feeling confused while reading this. Movie, popcorn, getting trapped, decoy? What is the meaning of these things?

The decoy effect is the phenomenon whereby consumers will tend to have a specific change in preference between two options when also presented with a third option that is asymmetrically dominated.

I know you ignored my above statement. Because it’s complicated. But that is my work. I help you understand sales and different strategies of sales in a simple way. If you want to know more you can simply go and read my blogs. Here is the link:  https://harshadasaleslearning.blogspot.com/

So what exactly happened in a Decoy effect. My friend went to buy popcorn and the sales guy offered him 3 options. Small, Medium, and Large costing as Rs. 100, Rs. 250, and Rs. 300 respectively. So can you guess which option he chose for all of us? I know you also do the same. He chooses a large size of Popcorn costing Rs.300.

            The moment he chose a large size of popcorn I jumped with super excitement and said, “Yes. I knew it…You got trapped.”

            People around us started looking at me thinking I am crazy or something. I realized I am in the theatre I took the popcorn and we all went inside. My friends were laughing at me. Nobody understood why I was getting so excited.

            But let me tell you the reason. Being my blog reader I always share some pieces of my learnings with you. I jumped out of excitement because today morning only I understood the Decoy effect and I saw it happening in front of me.

            So while doing my job I am also doing a part-time MBA. While going through my MBA books I read this wonderful concept of marketing called the Decoy effect.

Now I am explaining to you the Decoy effect that happened in the popcorn example.

The sales guy gave my friend 3 options.

1st is Small Rs 100

2nd is Medium Rs 250

3rd is Large Rs 300

Can you see the price difference between medium and large is just Rs 50 but the difference between small and medium is Rs 150?

Do you know why?

Because Medium size popcorn size is not for buying. They use it to influence the price.

They trapped your mind in a decoy effect.

By looking at the price difference between small and medium and going for a large size while buying that size your mind talks to you. Mind think you made a great decision by saving Rs 50 and you got a large size too. But in reality, you got influenced by the decoy effect created by the company and the company successfully sold you a large size of popcorn which was not needed at all.

I was jumping with the joy of observing my friend getting influenced.

 The effect in which buyer change their buying preferences when presented with a third choice. This is called as Decoy effect.

 How companies are using this strategy?

Starbucks provides the option of 3 sizes of coffee mugs, automatically buyers will buy large ones by seeing the minimum price difference.

 Whenever apple launches I phone in the market. It launches at time 3-4 models with a difference of 4-5 thousand. Most people will buy the most expensive one because of the decoy effect.

 Service businesses can also use the decoy effect, especially online businesses which work on a subscription base model. They provide features and package customization. Keeps basic features in 1st plan which costs low. Keeps minimal price difference in medium and large subscription packages so that usually buyers will prefer large plans. It makes them believe that they are winning, that they are making a better buy.

 In this way decoy effect works and helps businesses to grow by selling large sizes of products.

So thank you for reading my blog I am leaving you with a few options to read more.

My second blog where I wrote about a company behind Fevicol: https://harshadasaleslearning.blogspot.com/2022/11/do-you-know-company-behind-fevicol.html

My most read blog I got the best job in the lockdown period: https://harshadasaleslearning.blogspot.com/2022/12/i-got-best-job-in-lockdown-period.html

My blog about Sonata advertisement:https://harshadasaleslearning.blogspot.com/2022/11/sonata-karo-khudparyakeen.html

Go take a read.

Thank you.

 For knowing more sales-related updates connect with me on LinkedIn: https://www.linkedin.com/in/harshadapawar1307/

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