Decoy effect

Phenomenon whereby consumers will tend to have a specific change in preference between two options when also presented with a third option that is asymmetrically dominated.

Examples

Popcorn portion sizes at the cinema: if you are offered between small ($3) and medium ($5) you will probably pick small. Now, if you add a third option: big ($7), you will probably choose medium.

The original idea was you to buy the medium sized one in detriment to the small one, by adding a decoy (big), you will be more likely to buy medium. If you buy big, even better for them.

How it is exploited

Policies which have two options that don’t look convincing might all of a sudden have third option appear, much less likeable, giving legitimacy to the other two previous ones. By adding the third, one of the two previous ones is chosen.