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Anchoring

How would you answer these two questions?

1. Is the population of Turkey greater than 35 million?
2. What's your best estimate of Turkey's population?

If you are like most people, the figure of 35 million (researchers chose arbitrarily) influenced your answer to the second question. I've watched the behavioral scientists ask variations of these questions to groups of people many times over the past decade. In half the cases, 35 million was used in the first question, in the other half, 100 million. Without fail, the answers to the second question increase by millions when the larger figure is used (as an anchor) in the first question.

When considering a decision, the mind gives disproportionate weight to the first information it receives. Initial impressions, estimates, or other data anchor subsequent thoughts and judgements. The implications to influence another's perceptions are mind-boggling and can take many guises. A colleague can offer a comment, or statistic can appear in the morning paper which will influence your subsequent decision-making on that topic. Other guises can be as insidious as a stereotype about a person's skin color, clothing or accent.

In business, one of the most frequent "anchors" is a past event or trend. A marketer in attempting to project sales of a product for the coming year often begins by looking at the sales volumes for past years. This approach tends to put too much weight on past history and not enough weight on other factors.

Because anchors can establish the terms on which a decision will be made, they can be used as a bargaining tactic by savvy negotiators. Reduce the impact of the effects of anchoring in these ways:

1. Be open minded. Seek information and opinions from a variety of people to widen your frame of reference, without dwelling disproportionately on what you heard first.
2. In seeking advice from others, offer information. Offer just the facts without your opinion -- so that you don't inadvertently anchor them with your thoughts. Then you can benefit from hearing diverse views on the situation without their views being colored or anchored by yours.
3. Whoever most vividly characterizes the situation usually anchors the other's perception of it. That's an immensely powerful ability. Others literally see and discuss the situation while anchored from that most memorably stated perspective. The vivid communicator has literally created the playing field on which the game will be played on. Be especially wary of anchors in negotiations. Think through your position before any negotiation begins in order to avoid being anchored by someone else's proposal or position.

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Copyright© 2005 All right reserved, Kare Anderson.