The Decoy Effect and How It Applies to Restaurant Menus
You’re out to eat at a nice restaurant and you’ve finally made your decision on what to order. But then, the waiter comes over and asks if you’d like to hear about the special. Suddenly, your original choice doesn’t seem so good anymore. Why did this happen? It’s called the decoy effect, and it’s a psychological phenomenon that can be used to influence consumer behavior. In this blog post, we’ll discuss how the decoy effect works and how restaurants can use it to their advantage.
How the Decoy Effect Works
The decoy effect is a psychological phenomenon that occurs when people are presented with two options and one of those options is deliberately designed to be less attractive than the other. The goal is to influence people to choose the option that is more favorable to the person presenting the options.
For example, let’s say you’re trying to decide between two vacation packages: Package A costs $3,500 and includes a flight, hotel, and rental car; Package B costs $2,500 and includes a flight and hotel. Which package would you choose? If you’re like most people, you would choose the cheaper package.
Now let’s say that we add a third package: Package C costs $4,000 and includes a flight, hotel, and rental car. Which package would you choose now? If you consider Package C, then we’ve successfully used the decoy effect on you. By adding Package C—which is similar to Package A but more expensive—we’ve made Package C seem like a more attractive option.
Apple uses this the decoy effect on its iPhone products, when having a base($699),Pro ($999) and Pro Max($1099) prices, encouraging customers to get the most expensive option. The middle option servers as a “decoy” to make customers want to buy the highest model for just an additional 100 bucks.
Restaurants Use the Decoy Effect All the Time
If you’ve ever been out to eat at a nice restaurant, chances are you’ve been affected by the decoy effect without even realizing it. Restaurants often use this marketing tactic to influence customers’ ordering decisions by strategically placing items on the menu.
For example, let’s say there are three entrees on a menu: Chicken Parmesan for $15, Salmon for $25, and Steak for $30. The chicken dish is usually the least expensive option while the steak dish is usually the most expensive option. The salmon dish is placed in between these two options in order to make it appear as though it’s a good value even though it might be slightly overpriced compared to the chicken dish. In reality, of course, all three entrees are overpriced because restaurants need to make a profit. But by using the decoy effect, they can make diners believe they’re getting a good deal on their meal even when they’re not.
Conclusion: The decoy effect is a powerful psychological phenomenon that can be used to influence people’s behavior. Restaurants often use this tactic to influence diners’ ordering decisions, but it can be used in other industries as well. Now I encourage you, to use the decoy effect when pricing your items on your restaurant menus. For restaurants specifically, try to avoid offering too much and too little, but rather focusing on offering your top quality items while using a marketing tactic such as the decoy effect.
Make sure to share this read if you’d like learning about the decoy effect and other marketing tactics specifically on restaurant growth.