The decoy effect is an unconscious persuasion mechanism used in marketing. This causes changes in decision making by the consumer through the use of a decoy to distract the consumer's attention.
In other words, it consists of a marketing strategy that is based on comparison and has the objective of increasing the sales of a specific product.
When a company has two offers and wants to increase sales, it can use a third offer. This would become the lure effect, which will have inferior characteristics that will make it unattractive. In this way, the product that we are interested in selling will become more attractive.
The lure effect shows us that to make decisions as consumers we need to know the relative data. That is, we need to know the value of other similar products or services to compare it. In this way, to be sure that there is a good value for money.
Decoy effect example
Let's imagine that we are in charge of selling second-hand cars. We have two offers: an Audi A6 and a BMW 1 Series. Although we are especially interested in selling the first (somewhat more expensive than the second).
We then decided to introduce a third offer as a decoy effect. In this way, with the sole objective of increasing sales of the Audi A4, and to a lesser extent, the BMW.
The third offer is an Audi A4. A vehicle with inferior characteristics to the naked eye, older and with a higher price.
The client generally uses the comparison between similar elements. Therefore, you will compare the Audi A6 with a suitable price taking into account its characteristics, with an Audi A4 that is too expensive, based on the value for money.
What this user will perceive is that the Audi A6 has a good price. Something that, most likely, I would not have perceived without the decoy effect.