Pricing Page: How to nudge people into selecting your higher-priced option

I recently spent some time on listening to experts on startup growth reveal their secrets. (Very original and thought provoking content btw.)  You get to listen to 3 episodes for free before being prompted with the sign up page below.

Typically pricing pages have two options.  You can either choose the less expensive option with less features or the more expensive option with more features. Sometimes this can be a tough choice.  You want more bells and whistles but you don’t want to spend more money.  So the majority of people end up picking the less expensive option.

But look what does.  They add a third option, known as “the decoy”.  Look how close in price the third option is to the middle option and how much bigger the perceived value is.  Just $20 more and I get lifetime access vs. 1 year.  Not to mention that it’s typically $1764.  The box is also checked which gives me the feeling that I’ve already made my decision.  And look how simple it is to plug in my credit card info.  No need to leave the page.  (Sure enough I chose the lifetime option even though I knew what was going on.)

But Does the “Decoy Effect” Increase Average Revenue Per Sale?

To find out, researcher Dan Ariely asked students to evaluate subscription options for the Economist magazine.  In experiment #1, the students were presented with two options:

Option 1: $59 for online access

Option 2: $125 for print and online access

The results? 68% chose print and online and 32% chose online access

In experiment #2 Ariely added a third option:

Option 1: $59 for online access

Option 2: $125 for print (new option)

Option 3: Option 2: $125 for print and online access

The results this time?  84% of the students chose option 3 (print and online) and only 16% selected online only.

Pro tip: Introducing a decoy option on your pricing page can help make the choices less cognitively draining while driving prospects to your higher priced option.