Have you ever heard of the Decoy Effect?
The decoy effect is essentially when you introduce a third offer & pricing structure to make the other two offers seem like poor deals. In this article, we're going to do a deep dive on how you can use this trick to increase sales in your business!
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If I were to provide an offer where they can get either an E-guide, a training video, and then an offer with both the E-guide and training video, which do you think already they will want to choose? For just the E-guide, let’s say I price it at $47. For just the training, I price it at $97. For the pricing of the training and the E-guide, I price it at $97.
The natural human behavior is that it hurts more for us to lose out on money than it feels good to save money.
Which one do you feel like you would want to get? Already, you would most likely choose the bundle for $97 because the training itself is already the same price as the bundle, so why not get the bundle completely?
What I am doing with the training decoy is that I am making it more accessible for people to get both the $97 bundle instead of allowing them to think about choosing the E-guide at $47. Now in real time, what I probably would do instead of making the bundle $97 is pricing it at $117, so there is still a solid savings that makes the consumer feel like they are not losing out on money – and that is essentially the whole point of the decoy effect.
The natural human behavior is that it hurts more for us to lose out on money than it feels good to save money. As a result, customers will want to choose the bundle training because at the end of the day, they will end up not losing money. Again, this is because it is high-quality for a deal. The decoy effect will allow customers to easily choose the higher-quality, higher-rate pricing because it just makes sense. And we want it to make sense like this because when it comes to online products or services, the online world is already noisy.
So, the easier is it for a customer to make a decision, the faster it is they will make that decision. The faster the buyer's journey, the easier it is for you as the producer to increase sales.
If you loved learning about the Decoy Effect, download my guide to creating an effective marketing plan here.
I'd love to know, what offer can you provide that can have a decoy effect? Comment below or DM me your answer on Instagram.