![]() ![]() And the same thing applies when we see a sign stating “limit 5 per customer”. For example, if there’s a sale sign showing “4 apples for $5”, we’re more likely to buy 4 even if we can buy them for $1.25 each. In addition, anchoring is also what makes multiple-unit pricing successful. Knowing that people don’t tend to veer far from initial information, they make sure the first price people see is high. Marketers also use anchoring to their advantage. It’s not hard to imagine how this can lead to biased judgments about other people or incorrect conclusions about situations. We tend to only give credit to information that supports our initial judgment, and discard or invalidate information that doesn’t. ![]() In addition, it can also lead to self-fulfilling prophecies. The main pitfall is that anchoring leads to inaccurate conclusions or poor decisions because we disregard, or don’t even notice, potentially crucial information. From that knowledge, we can adjust our behavior accordingly. If someone tells you they’ve just experienced a traumatic event such as the death of a loved one, or a happy occasion such as a marriage, we can make assumptions about how they’re feeling based on our own experiences-our memory is serving as the anchor in this case. It’s probably fine to base your decision on your experience of what you’ve enjoyed previously.Īnother benefit is that anchoring helps you to gauge quickly how others are feeling in social situations. Imagine taking the time to consider the pros and cons of each item on the menu and what factors may be influencing you. Some decisions may just not matter that much, such as what to have for lunch. It was probably not a good idea to take the time to gather more information and carefully think over whether this person was actually going to be aggressive or if they were just having a bad day.Īnd in today’s environment, without a quick way of evaluating everyday situations, we’d spend way too much time and effort deliberating over small decisions. For our ancestors, it was probably important to be able to recognize an aggressive facial expression quickly. There’s likely an evolutionary advantage to being wired this way. It helps you make reasonable estimates and quick evaluations in complex situations when you have limited information or time. Video: Critical Thinking - Cognitive Bias: AnchoringĪs mentioned above, a benefit of anchoring is it allows for fast decision-making. This video shows several of the above anchoring examples and explains how it affects our judgments. Other examples of situations where anchoring occurs: At discount clothing stores, I think I’m getting “such a deal!” if the tag shows the suggested retail price as much higher than what I’m paying, even though that original price could very well be arbitrary. So, when they come down a bit, the buyer is more likely to go for it, even if it’s still overpriced. Sellers often set a price much higher than they expect to get. (I hope she updated her impression.)Īnchoring is used widely in sales. Recently at a company outing, a coworker was hesitant to hug me goodbye, saying “I get the impression you’re not a hugger”. But the truth is, it just takes me a little time to become comfortable, especially in a group setting. I tend toward shyness, so when I meet someone, my quietness is sometimes taken as coldness or aloofness. Here’s an example from my own experience. Unfortunately, we also tend to base future judgments of the person on this initial, sometimes superficial impression, which in turn affects our behavior toward them (Willard & Markman, 2017). These things give a starting reference point and allow you to make quick decisions about how to respond when you don’t know someone well. These rapid evaluations are based on facial expressions, our memories of other similar people, and even how we see ourselves (Willard & Markman, 2017). Studies show that we can make judgments about people’s personalities in milliseconds (Willis & Todorov, 2016). An example we’re all familiar with is judging others on first impressions. ![]()
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