Neuromarketing Services

Anchoring Bias – How the Brain Sees Prices

Do your customers know how much things cost? Does the brain perform calculations before deciding? Typically, the answer is no to both questions. The fast-thinking brain is lousy at calculating. It’s good, though, at storing numbers and comparing them to each other. The brain often sees the first number and uses it as a price anchor. When different prices appear, the brain makes a rough comparison that is influenced by the anchor.

Anchoring Bias

In a 1999 Austrian study, researchers Strack and Mussweiler asked subjects to guess how old Mahatma Gandhi was when he died. Before asking that, though, they asked two groups different questions. They asked one group if he died before age 9, and another group if he died after the age of 140. The obvious answer to both was no. Then, the groups estimated his actual age of death (87). The first group’s average estimate was 50. The second group’s guess averaged 67. An anchoring bias created by the numbers in the first question influenced the estimates.

Price Anchors Affect Almost Every Transaction

No matter what services or products you offer, your customers will arrive with price expectations already in mind. Usually, those anchor estimates are inaccurate. Neuromarketing experts understand that resetting price anchors in people’s brains is an important first step, especially for high-value goods and services. Then, offering a strong value proposition is much easier. Specific neuroscience-based techniques are needed for each unique business. There’s no simple formula for success. Custom-tailored strategies and testing will produce results that boost sales revenues and leads.

How Relativity Bias Affects Perceived Prices – What is a good price? It really depends how one price is compared to another. Why do prices only make sense in comparison?
How Outcome Bias Influences Buying Decisions – Why do our expectations change our evaluation of cost, risk, and enjoyment?
FREE Cost Estimate