Asymmetrically Dominated Choice

Imagine you are at an amusement park, in line to purchase a snack. You’re not that hungry, so a small hot dog should suffice. When you get to the concession stand, you see that a hot dog is $3, a jumbo dog is $6, and a jumbo dog combo (with fries and a drink) is $7. You justify the combo because it wouldn’t make sense to only get the jumbo dog; after all, for only $1 more, you can get a whole meal. So, you purchase the $7 combo because it is a better deal, despite the fact that you just wanted a small snack. ¹

You have been influenced by an asymmetrically dominated choice. If you had been presented with only two options, the small hot dog and the jumbo dog meal combo, you would have likely picked the hot dog. There is a large price difference, and you aren’t that hungry to begin with. However, through the addition of a third ‘decoy’ option, you were influenced to spend more money.

Asymmetrically dominated choice involves a decoy being used to push consumers towards a “target” product. The product that usually competes with the target is known as the “competitor.” The “decoy” is meant to make the target option much more attractive, usually by making it appear like a really good deal.¹

The decoy makes our choice seem obvious, but it was purposefully placed to push us towards a target option. Since the asymmetrically dominated choice uses a decoy to sway people’s decisions, it is commonly referred to as the decoy effect.