The Decoy Effect Within Alcohol Purchasing Decisions

The decoy effect is the phenomenon where the introduction of a third choice to a decision dyad changes the distribution of preferences between options.

Examine whether this effect exists in alcohol purchasing decisions and whether testing context impacts this.

Fifty-two participants tested in either a bar or library context and were asked to choose one of a series of beer and water deals presented for timed intervals. In some cases, two options were presented (with similar attractiveness) and in other cases a third, less preferable, decoy option was added.

A basic decoy effect in both alcohol and water purchasing decisions. Specifically, there were reductions in the selection of both the original options when the decoy was added into choice dyads. A significant interaction demonstrated in the bar context there was a significant difference such that there was a slight increase in participants selecting the most cost effective option when the decoy was added, and a simultaneous decrease in those choosing the moderately cost effective option. There were no such differences observed in the library condition.

The same product may be perceived differently across contexts and, as such, consumers in a pub environment may be particularly vulnerable to the decoy effect.