Decoy Effect

What are some rookie mistakes diners make at very high-end restaurants?

Peter Baskerville, Started and managed a few restaurants in Sydney.

Updated Jul 22 · Upvoted by Andrew Perlberg, 10 years of serving, bartending, and line cooking.

Falling for the Decoy Effect with the wine price list and paying a lot more for their wine than the rookie intended.

The Decoy Effect is used by many businesses that sell goods and services, and high-end restaurants apply it with great skill to their wine list. The Decoy Effect works best for products like wine, where an objective assessment of value/price is near impossible to establish, especially for a rookie.

So the rookie’s value/price assessment becomes heavily influenced by the subjective value presented in a cleverly designed wine list, as illustrated below:

Restaurants that incorporate the Decoy Effect in their wine list will include one or two top quality and very expensive wines, in order to shift the customer’s view of a reasonable choice to a higher pricing level than would happen if the decoy was not in place.

Rookies should not be fooled by the shock they feel when they see the prices of these top quality wines (which the restaurant probably never sells), because these wines help to sell the lower priced wines, even if they themselves are still much higher than the rookie intended to spend when they first arrived.

So if your partner wishes to celebrate the event with a bottle of Champagne using the choices from the wine list below, the Decoy Price of $265 is meant to make you feel that the $125 bottle is a reasonable choice in that you’re not being extravagant by choosing the highest quality wine nor are you being a ‘cheapskate’ by selecting the $45 bottle, even though a $45 bottle of wine in the vast majority of restaurants would get you a reasonably good bottle of wine. So the restaurant gets to sell you the $125 bottle primarily because you have been led to believe that it is a reasonable price when compare to the decoy price of $265. If the Decoy price was not offered, the $95 bottle or an even cheaper option would then become the more reasonable and therefore, oft purchased choice.

Seasoned diners at high-end restaurants scan the wine list descriptions for their favourite wines with little regard for price, so they are less likely to fall for the Decoy Effect.