Using the “decoy effect” in your business

Many years ago a friend who owned a successful screen printing equipment supply business explained one of his marketing tactics. He was a great observer of human behaviour and noticed that, given the choice of three items of equipment with slightly different features and priced at three different levels, customers would inevitably choose the middle one.

Have you tried the ‘decoy effect’ in your business?

I was reminded of my friend recently when Shopify published an article on a similar concept. It’s called the “decoy effect.” They used the iPhone to illustrate the concept: ” . . . let’s say you’re buying a new iPhone. Option A is $500 for 30GB and Option B is $400 for 20GB.”

They say that, given these two choices, you would buy A or B depending upon your price and storage priorities. Shopify goes on to say: “But now Apple has released another option, Option C. At $550 it’s more expensive than both A and B but has slightly less storage (25GB) than A.”

Option C is the decoy.

The result is that nobody who thinks about it is going to buy C, but it causes A to be chosen more often than if only A or B were offered. And A is what Apple wants to sell most of.

How can you apply the “decoy effect” in your screen shop?