The Decoy Effect in UX: How Smart Pricing Influences Decisions

As UX and product designers, we often focus on flows, patterns, and usability. But sometimes, a tiny shift in how information is presented—particularly pricing—can dramatically influence what users choose.

One powerful example of this is the Decoy Effect, also known as asymmetric dominance.

Let’s explore how it works, why it matters in product strategy, and how leading e-commerce brands use it to drive conversions.

What is the Decoy Effect?

The Decoy Effect is a cognitive bias in which people tend to change their preference between two options when presented with a third one—the decoy—which is strategically designed to make one of the original options look more attractive.

In UX terms:

We’re shaping perception, not just offering choices.

Real Example: Apple’s iCloud Storage

At first glance, you might think 50GB is enough—but when you see the 2TB option at ₹749, suddenly the 200GB option looks like a great deal.

 The ₹749 option is the decoy. Its job isn’t necessarily to sell—but to nudge users toward the more "reasonable" ₹219 tier.

The result?

A predictable increase in conversions for the middle-tier plan.

Zomato Pro: Another Decoy in Action

Popular food delivery app Zomato Pro uses a similar strategy:

Zomato Pro: Another Decoy in Action

Even though the annual plan offers better value per month, many users pick the 3-month plan because the monthly one feels too short—and the annual feels like a long commitment. Once again, the monthly plan acts as the decoy, making the 3-month plan appear to be the "smart" middle ground.

Why It Works: Behavioral Economics Meets UX

The Decoy Effect works because humans are not always rational decision-makers—we’re emotional and contextual. When presented with a choice, we naturally compare options relative to each other.

As designers, we’re in a position to:

• Ethically guide users to better-value choices

• Increase conversion rates

• Improve perceived value of offerings

And we can do this without adding friction, just by tweaking layout and pricing logic.

How to Apply This in Your Design Work

When designing pricing plans, subscription tiers, or feature comparisons, ask yourself:

✔ Which option do I want most users to choose?

✔ Can I introduce a third (decoy) option to frame it better?

✔ Am I supporting the user’s decision-making with clarity and transparency?

Remember, the goal isn’t manipulation—it’s clarity, confidence, and conversion.

The Takeaway

The Decoy Effect is more than a marketing trick. It’s a psychological principle that—when applied with empathy—can lead to smarter product design, improved user decisions, and better business outcomes.

So next time you're sketching a pricing table, don’t just think about what looks clean—think about what feels right to the user.

Have you used or spotted the Decoy Effect in your product?

Share your thoughts and examples in the comments below!