Inside Thoughts

How I’ve Been tricked Into Overspending Most Of My Life.

Have you heard of the ‘Decoy effect’? I have only learned about it this week!

Alas, in learning about it I have discovered that I have been a victim of overspending most of my life!

What is the Decoy effect you ask? It is best explained by these two examples:


1. If you are booking a flight and have to choose from these three options, what would you choose?

  • Flight A costs $400 with a stopover of 60 minutes.
  • Flight B costs $330 with a stopover of 150 minutes.
  • Flight C costs $435 with a stopover of 60 minutes.

Did you say A? So did I! Research shows you are not alone. Most people chose flight A because it is cheaper than C with a shorter waiting time. Note however, that both are far more expensive than B.


2. Now look at a different set of flights:

  • Flight A costs $400 with a stopover of 60 minutes.
  • Flight B costs $330 with a stopover of 150 minutes.
  • Flight C costs $330 with a stopover of 195 minutes.

Did you say B?

So did I! And researchers show that this was most of people’s preference.

However A and B are exactly the same as they were in the first example. Now that C has a longer stopover, somehow this changes the way we view the other options! So now it seems okay to wait for longer with a cheaper price.


The Decoy Effect

What is the decoy? It is in both cases Flight C.  For each of the other options are the target options from the companies. Option C is put there as a slightly less attractive option to make the other two look more favourable.

This is a marketing ploy based on experiments that have shown that the use of a well-designed decoy such as this can shift opinion between the other two options as much as 40%! Isn’t it fascinating how easily we can be swayed to make decisions according to how they are framed? From the first example we were all willing to pay more money for a different flight simply by the placement of a dud option!

These patterns of behaviour have been observed in many different types of goods including cars, houses, beer, TV, flights, and commercial products. The decoy effect uses a third option that changes our preferences between two other ‘target possibilities.’

Isn’t this fascinating! Now that I have been alerted to this. I have seen this clever marketing ploy everywhere. AND noticed how I have succumbed to it time and time again, while thinking I had got the better deal!

It is so clever!

How about you beloved? Have you noticed the Decoy effect anywhere? Have you too been enticed by one?

I would love to hear! Comment below.

You are deeply loved and richly cherished,

Dr Christine Greenwood

Reign in life

P.S This article and the examples were inspired by ‘The Tricks that make you overspend.’ By David Robson.

Wink: I think it is my Asian gene that loves a bargain. I have totally bought into the decoy effect more times than I can count. In fact, I wouldn’t be surprised if this marketing decoy is targeted mostly at Asians like myself who love a bargain. So confronting!

P.S In other news? Have you made the chocolate cake in the article 10 healthy recipes. It has beetroot and avocado. Give it a crack!

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