The Decoy Brand is when you subtly position your main product offering as superior by deliberately making another product offering that is a bit inferior.

In the advertising agency world, we are all used to clients asking us for ‘options.’ Even when we believe in an idea that is the strongest and most appropriate for the objective at hand, we need to make a few more options. It now appears that the need for options is rooted in our decision-making process before we make the right choice. Even prospective brides and grooms generally go through a few options before they settle on the right one. A smart marketer knows this and seeks to aid the customer in swaying their decision towards the main product offering.

How it works

Say you were deliberating on purchasing new iPhones in 2021. You have two broad choices, the iPhone 13Pro or the 13Pro Max. You probably went through the specs online and deliberated on your final choice. What most likely drew you to choose the 13Pro Max was the perfect decoy in the form of the iPhone 13 Pro. A bit inferior in every way, you were not quite convinced that you were getting optimum value even by paying a lower price, instead, you saw value in paying slightly more and getting much more in terms of specs as well as the pride of owning the latest flagship product.

How is your brand positioned?

The decoy effect not only works among your brand’s product offering but across brands themselves. It would help to carefully analyze where your brand stands vis-a-vis your competitors. If you’re left scratching your thinning hair as to why your brand won’t sell as much as your competitors, your brand is probably the decoy brand – not offering a premium product with prices to match nor offering a ‘value’ option with prices you can’t argue with.

How can you take advantage?

Decoys are relatively easier to create. You can do this in a few ways: 

  1. Make a feature/design/spec on the decoy less attractive: By taking away a key feature or compromising on the design, you immediately create differentiation in your potential customer’s minds. They will likely gravitate towards your main product as it seems completer and more compelling.
  2. Price the decoy slightly lower with a large feature gap: With a lower price point, the customer pauses to reflect upon the price point. Upon comparison, the customer should come away feeling the lower price point is not worth the massive product compromises.
  3. Price the decoy significantly higher: The simple logic is that customers will not pay significantly more for a product offering that they cannot discern to be superior. But this is a more expensive decoy to create. This would only work if your main product offering is on a mass scale. 
  4. Make sure to stay within 3 product offerings: Don’t throw too many options into the mix. Two is good, three is the maximum. Beyond this, the customer can’t work out the differences and values effectively and loses focus.

Smart marketers know that not every product they send out for sales needs to actually sell. Because of the inherent nature of humans to contrast and compare before making choices, they know and aid this process through decoy offerings that serve no other purpose except to point the marker towards their main product offering. 

Subu

About Author

Mr. Sramanendra Bhakta Shrestha popularly known as Subu Shrestha is the
Director at Advantage Group (P) Ltd. a leading advertising communications firm based in Kathmandu. Over the past 23 years, Mr. Shrestha has worked with almost every major corporate firm in Nepal and has been a part of the most wonderful campaigns created by the agency.

Besides Advantage Group, he is also involved in a number of other companies as a Director like Casa Deyra Pvt. Ltd., Ananya Apartments Pvt. Ltd., Yakety Yak Hostel, Tuki Logic Pvt. Ltd. to name a few.

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