Anchoring: Using Persuasive Pull

“The first thing you hear about a new topic automatically becomes an anchor in your mind that biases your future opinions.”

Scott Adams, Win Bigly

You can use anchoring to influence others by giving information like a number that unconsciously skews other peoples’ estimates of what’s acceptable.

How good are you at guessing how many calories you in a given day? How about other estimates, like what the temperature will be today?

Chances are, you’re far worse at it than you thought, thanks to anchoring.

For example, if you had just told someone how old you are right before estimating the temperature, your age would have a measurable impact on your estimate even though its totally unrelated.

Or let’s say you’re writing up a business plan and you want to estimate the number of sales a startup can make in the first year. If you look at a smaller but comparable business that does $1M in sales, you may estimate that you’ll do $1.8M in sales.

But if you look at a bigger but comparable business that does $5M in sales, you’ll likely estimate something higher, like $4.1M in sales. Your higher estimate after looking at a bigger sales number is another example of anchoring.

Anchoring affects you even when you’re not aware of it. But, even more dangerously, it affects you even when the people using anchoring are unaware they’re using it.

WHAT IS ANCHORING? WHY DOES IT MATTER?

As Scott Adams defines it in Win Bigly, “An anchor is a thought that influences people toward a persuader’s preferred outcome.”

Often, anchoring involves starting with a piece of information (e.g., a number), and then adjusting that anchor to get what you’re trying to estimate.

As explained in Nudge, “[t]he bias occurs because the adjustments are typically insufficient.” This is because the anchor “pulls” you in a certain direction.

ANCHORS CAN BE UNRELATED

Anchors can be unrelated; you can use the temperature or time of day to influence negotiations over a raise, for example.

Research shows that an anchor can be totally unrelated.

For example, the last four digits of your phone number or social security number have a measurable effect on completely unrelated numbers.

Let’s say you want to sell your company and are hoping to get, say, $2M for it. When negotiating with a potential buyer, you could anchor them by saying it’s “almost 11 AM” or that you can’t believe the temperature is getting “up into the 60s”. Mentioning the higher, totally unrelated numbers will increase the odds you get a higher offer.

HOW YOU WILL LEVERAGE ANCHORING

You should use anchoring in negotiations by being the first to throw out a number.

• Copywriting — How can you mention a big number before your ask your potential customer to pay $X? For example: “Hundreds of customers use our product every day. Get yours for $29.99.”
• Sales — When pitching the price of something, you can tell potential buyers “we normally charge $1,000, but we’ll make it $750 for you”. This would be more effective than if you mention something like “some customers pay $500”.
• Ask First — Always be the one to put the first number out there. You set the anchor for the rest of the negotiation.
• Ask for More — The bigger your request, the higher the outcome you’ll likely get. As explained in Nudge: “Clever negotiators often get amazing deals for their clients by producing an opening offer that makes their adversary thrilled to pay half that very high amount.”
• Fundraising / Pitching — If your fundraising, you can increase the amount you raise by setting higher donation options (provided people can also enter custom amounts). This also taps into social proof by implying that the higher amounts are what other people donate.
• Anchor Yourself — For example, think about your personal savings. If you want to save more, anchor yourself. For example, if you’re buying a car, set an “anchor” car and know how much it costs before you talk to any sellers. You’ll likely end up spending less (and negotiating more).

How have you leveraged anchoring to persuade and influence? Where have you seen it used by others? Share your expertise in the comments.

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