During decision making, anchoring occurs when individuals use an initial piece of information to make subsequent judgments.

Once an anchor is set, other judgements are made by adjusting away from that anchor, and there is a bias toward interpreting other information around the anchor.

For example, the initial price offered for a used car sets the standard for the rest of the negotiations, so that prices lower than the initial price seem more reasonable, even if they're still higher than what the car is really worth.

Studies have shown that anchoring is very difficult to avoid.

For example, in one study students were given anchors that were obviously wrong. They were asked whether Mahatma Gandhi died before or after age 9, or before or after age 140.

Clearly neither of these anchors are correct, but the two groups still guessed significantly differently (choosing an average age of 50 vs. an average age of 67).

During decision making, anchoring occurs when individuals use an initial piece of information to make subsequent judgments.

Once an anchor is set, other judgements are made by adjusting away from that anchor, and there is a bias toward interpreting other information around the anchor.

For example, the initial price offered for a used car sets the standard for the rest of the negotiations, so that prices lower than the initial price seem more reasonable, even if they're still higher than what the car is really worth.

Studies have shown that anchoring is very difficult to avoid.

For example, in one study students were given anchors that were obviously wrong. They were asked whether Mahatma Gandhi died before or after age 9, or before or after age 140.

Clearly neither of these anchors are correct, but the two groups still guessed significantly differently (choosing an average age of 50 vs. an average age of 67).

Participants were asked to quickly estimate - within 5 seconds -  the answer to one of two same calculations, anchored either low or high.

Those with the low anchor guessed 512 on average, whereas the high guessed a much higher 2,250. The correct answer was 40,320.

Put the highest price first

This will make subsequent prices appear cheaper in comparison and increase sales.

For instance, on the wine list shown, instead of putting the expensive items at the foot of the list, rearrange them in descending price.

Alternatively, if higher, show your competitors' prices first before revealing your comparative value.

Don’t set your anchor price too high

If you do, the natural inclination to anchor other options against this price will diminish.

Be realistic. Keep it within an appropriate region of your other prices in order for your anchors to be effective.

Audience matters.

Anchoring effects  weaken for those with higher cognitive ability (Bergman et al., 2010) and those with prior product-buying experience (Alevy et al., 2011).

72 people were split into 3 groups: Humor, Neutral or Contentment and shown a respective video: Mr Bean (a British comedy show), an educational  video or a beach scene. They were then all asked to solve a secretly-impossible puzzle.

Those humored spent 50% more time and made 2x more attempts trying to solve the problem than others.

Make it funny. Consumers have more positive attitudes towards humorous ads and their brands, increasing intentions to buy (Eisend, 2008). However, levels are dictated by product category and how related the humor is to the product.

 Funny stories are more memorable than other positive emotions  like admiration or respect.  Puns are particularly memorable because they force us to simplify our humor delivery to a single line, reducing mental effort (Summerfelt et al., 2010).

Bring humor into the workplace. It helps boost employee satisfaction (Decker 1987), leads to higher productivity (Avolio et al. 1999) and boosts creativity (Brotherton 1996).  Ben & Jerry’s, Southwest Airlines and Sun Microsystems are well-known for their use of humor within organizational culture (Barbour, 1998). 

32 dog-phobic children were split into 3 groups and shown 8 videos of either one child playing with a dog,  many children with different dogs or no dogs, and then asked to interact with a dog themselves.

Those who watched another child play with a dog performed far better. Those who watched many children also kept this up a month later.

Provide mental shortcuts through the judgements of others; the more people, the more persuasive.  First-time consumers of your product will benefit the most from this approach. 

Persuade with similarity. We're most influenced by those who we deem similar to ourselves. Communicate characteristics relevant to that segment, such as proximity, gender / age, profession or social class to successfully direct behavior. 

Use role-models. Understand the emotional drivers of your audience and seek out positive, aspirational individuals to direct specific consumer decisions and reinforce behaviors.

Did you know of the fascinating study of winners of the popular gameshow The Weakest Link (Raghubir & Valenzuela, 2006)?

Researchers found that contestants randomly assigned to a central position in the semi-circle tv set design were 45% likely to win the show over those positioned at the edges, who were only 10% likely.

Multiple studies have shown a bias like this to prefer central options over ones at the extremes, in what's called "edge aversion".

There are two key mechanics underpinning Centre-Stage:

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1. Central gaze:

Eye-tracking research has shown us to have a tendency to give more attention naturally to what is directly in front of our eyes (Atalay, Bodur, and Rasolofoarison, 2012)

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2. The "Centre is Best" belief:

Where we feel that options placed in the middle are somehow better or more popular than those that them. This may be driven by how we use cues around group status, authority and attractiveness and how we then map these beliefs onto unrelated items so as to make the 'best' choice.

‍

Certainly, Weakest Link contestants are no less subject to this phenomenon than supermarket shoppers.

One wonders, if the tv set was creatively redesigned so that contestants would be stacked vertically, how their odds of winning might be a little better if they were up top, seen as gods looking down on the rest.

Did you know of the fascinating study of winners of the popular gameshow The Weakest Link (Raghubir & Valenzuela, 2006)?

Researchers found that contestants randomly assigned to a central position in the semi-circle tv set design were 45% likely to win the show over those positioned at the edges, who were only 10% likely.

Multiple studies have shown a bias like this to prefer central options over ones at the extremes, in what's called "edge aversion".

There are two key mechanics underpinning Centre-Stage:

‍

1. Central gaze:

Eye-tracking research has shown us to have a tendency to give more attention naturally to what is directly in front of our eyes (Atalay, Bodur, and Rasolofoarison, 2012)

‍

2. The "Centre is Best" belief:

Where we feel that options placed in the middle are somehow better or more popular than those that them. This may be driven by how we use cues around group status, authority and attractiveness and how we then map these beliefs onto unrelated items so as to make the 'best' choice.

‍

Certainly, Weakest Link contestants are no less subject to this phenomenon than supermarket shoppers.

One wonders, if the tv set was creatively redesigned so that contestants would be stacked vertically, how their odds of winning might be a little better if they were up top, seen as gods looking down on the rest.

155 people were shown a cocktail menu, with 5 options listed either vertically or horizontally. They were then asked which drink they'd prefer.

In great contrast with those with a vertical menu, those with the horizontal menu were far more likely to choose a drink in its centre (26.5%) than at its edges (10%).

Put what's 'best' in the centre

Whether it's a product on a shelf, a panelist on a tv show or a set of cocktails in a menu, what's horizontally surrounded by its peers is seen as most popular.

Those unfortunate enough to be placed at the edge are therefore seen as less attractive or riskier, unless actively stated otherwise (e.g. "Market Leader" / "most popular").

If you're designing for 1) new customers with limited knowledge or 2) for a range of products that don't vary too much from one another, reduce cognitive fatigue by presenting a small set of choices horizontally, helping them towards the middle option.

Consider adding in some Social Proof to boost effectiveness and guidance.

Orientation is everything

So, as a general rule, for horizontal lists, we'll more likely choose the middle option given its perceived popularity.

However, for a vertical list of options, the opposite is true: the first and last items are seen as more influential and are more likely to be chosen (See Serial Position Effect).

Put simply, we have an in-built judgement of good as up and bad as down and that, when it comes to making a choice, the higher, the better, quite frankly!

In both an online and physical context, orientation and order matter greatly.

In what orientation order are you currently presenting options to people?

Can this be improved by changing the orientation in some cases?

Use to nudge better choices

A recent project by Behavioural Insights Team and Nesta utilised Centre-Stage Effect to nudge smaller portion sizes by 22%.

Another study (Keller et al, 2015) showed that as well as portion sizes, Centre-Stage can, amongst other things, be used to nudge healthier product choices. Healthier choices increased from 13.3% to 36.7% by placing them centrally.

What better choices do you want to help people make? Presented horizontally, put these in the middle to increase their selection.

The gift-buyer booster

It was also found that the Centre-Stage Effect is stronger when consumers are making purchase decisions for others (e.g. buying a gift, or food for a dinner you’re hosting).

Are any products you're selling predominately bought as gifts? What orientation are you presenting them in? Help people choose the 'most gifted' product by placing it centrally in a horizontal set.