Psychology
What is The anchoring effect?
The anchoring effect is a bias where the first number or piece of information you see heavily influences your later judgments. For example, a high 'original price' makes a sale price feel like a great deal, even if it isn't.
See it, don’t just read it.
Watch a 2-minute lesson with voice + animation that explains the anchoring effect.
Key things to understand
- 1The first information seen 'anchors' later estimates.
- 2We adjust away from the anchor, but usually not enough.
- 3Retailers use it with 'original' vs. 'sale' prices.
- 4It affects negotiations, pricing, and everyday decisions.
Frequently asked questions
- What is the anchoring effect?
- A bias where the first number or fact you encounter skews your later judgments and estimates.
- How is anchoring used in marketing?
- Showing a high 'original' price first makes the actual price feel like a bargain by comparison.
- Can you avoid the anchoring effect?
- Being aware of it, questioning the first figure, and seeking independent reference points all help.