Imagine you’re walking into a store, looking for a winter coat. The first one you see is $400—far more than you intended to spend. But as you browse further, you find another coat for $275. Suddenly, that second coat feels like a steal, even though it’s still above your budget. This subtle shift in perception isn’t just about numbers—it’s a glimpse into how our brains take cognitive shortcuts to make sense of new information, especially when decisions are complex or unfamiliar.
At the heart of this process is what psychologists call anchoring bias. It’s a type of mental shortcut, or heuristic, where the human mind uses the first piece of information it encounters—the “anchor”—as a reference point for everything that follows. Even when that initial number or idea has little to no relevance, it strongly influences our judgments and decisions. That $400 coat you saw first becomes the unwitting benchmark against which every other price is compared.
This doesn’t happen because we’re lazy thinkers. On the contrary, the brain is wired to seek efficiency. In a world overflowing with data, we depend on heuristics to navigate daily life quickly. Anchoring is one such cognitive shortcut—an automatic, often unconscious way our minds try to sift through ambiguity or assess value. The problem arises when the original anchor isn’t reasonable or is randomly selected, yet we still let it subtly steer our thinking.
From a psychological standpoint, anchoring bias taps into our instinctive need for certainty. When we’re unsure about how much something should cost, how long something should take, or what an acceptable answer might be, we reflexively lean on what’s available—often the most recent or prominent piece of information. That initial detail doesn’t just start the conversation; it quietly dictates its direction. Even when we try to adjust or compensate, we rarely do it enough. This is known as “insufficient adjustment,” a common feature of anchoring seen in both experimental settings and everyday experiences.
Understanding how anchoring works inside us is the first step toward identifying it outside of us. As we unravel more real-life examples, it becomes easier to notice just how deeply these initial impressions can shape our decisions—sometimes without us even realizing.
Real-world examples of anchoring bias
Anchoring bias shows up in countless everyday situations, often without our awareness. Consider a common experience: negotiating the price of a car. A savvy salesperson might start with the car’s Manufacturer Suggested Retail Price (MSRP), which is intentionally set higher than what the dealer expects to receive. That price acts as an anchor, subtly influencing the customer’s expectations. Even after bargaining and securing a significant “discount,” the buyer often leaves feeling satisfied—despite possibly paying more than the car’s actual market value. The MSRP, irrelevant as it may be to the car’s worth, creates a psychological benchmark from which negotiations begin.
Online shopping presents another arena for anchoring. Take an e-commerce website that lists a phone case as “originally $49.99, now $24.99.” That original price serves only one purpose: to anchor your perception of value. Psychologically, $24.99 is no longer just a number—it’s a deal, a savings, a smart decision. In reality, the phone case may never have been sold for $49.99 at all. Retail marketing thrives on exploiting these cognitive shortcuts because they trigger our internal sense of fairness and opportunity.
Anchoring bias is also visible in the courtroom. Research has found that when prosecutors suggest a high sentence, juries often recommend harsher penalties—even if they believe the number is arbitrary. A well-known study by psychologists Birte Englich and Thomas Mussweiler demonstrated that even legal professionals were influenced by an absurd anchor: they had participants roll dice (rigged to always show either 3 or 9) before making a sentencing recommendation. Remarkably, those who rolled a higher number gave longer sentence suggestions, despite knowing the dice were unrelated to the case. This illustrates just how deeply anchoring can distort even informed, reasoned judgment.
In the business world, anchoring impacts salary negotiations. A candidate who presents a high initial salary expectation anchors the conversation at that level, affecting not only the employer’s counteroffer but also the final deal. Likewise, real estate agents often set listing prices to frame negotiation windows, leveraging anchoring to nudge buyers toward certain price ranges—regardless of the actual value of the house.
Even our estimates of time and effort are vulnerable. Ask someone how long it will take to finish a project, and their answer will be shaped by the first suggested duration—even if it’s way off base. This “decision influence” can lead to underestimating complex tasks and overcommitting in both personal and professional settings.
These real-world scenarios underscore how anchoring bias interacts with our cognitive heuristics and decision-making processes. Like gravity, it pulls our judgments toward that first piece of data, whether accurate or arbitrary. Recognizing when we’re being anchored isn’t always easy, but understanding its power is the first defense against letting it distort our choices.
Strategies to reduce anchoring effects
Reducing the influence of anchoring bias begins with awareness, but combating its effects requires deliberate strategies. One of the most effective tools is generating multiple, independent estimates before settling on a decision. This works well in contexts like price evaluations or project planning. For instance, instead of latching onto the first figure presented—like an initial house listing or early project deadline—you might deliberately calculate alternative values based on different factors: past examples, market trends, or observed performance metrics. When people diversify their reference points, the initial anchor loses its force, making room for more balanced judgment.
Another technique involves delaying judgment. Cognitive psychologists suggest that taking a brief mental pause between encountering an anchor and making a decision gives the brain time to consider the relevance and accuracy of the given information. In business meetings or negotiations, this could mean resisting the urge to respond immediately to an opening figure. Instead, giving yourself a moment—even just a few seconds—can help create distance from the anchor, reducing its subconscious hold and interrupting the automatic application of cognitive shortcuts.
Reframing the information is a powerful way to counteract decision influence. For example, in hiring or negotiations, if a salary anchor is unusually high or low, shifting focus to objective benchmarks—such as comparable roles in the industry, historical salary data, or documented performance indicators—can recalibrate expectations. This strategy is grounded in the psychology of reframing: when perspectives change, so does the context in which information is processed, weakening the emotional impact of the anchor.
Training and practice also mitigate anchoring’s effect, especially in fields that routinely deal with judgment under uncertainty. Judges, doctors, and financial analysts who undergo decision-making workshops that emphasize heuristics and biases tend to develop more robust mental checks. Exercises such as comparing multiple scenarios, questioning the source and relevance of initial data, and systematically testing assumptions can diminish the weight of irrelevant anchors.
Finally, seeking a second opinion can play a critical role. When two or more people tackle the same problem independently, the divergent anchors they start with can expose one another to alternative interpretations. This not only breaks the influence of any single anchor but reinforces impartial thinking. Decision-making becomes less about the first figure you see and more about the larger context in which that figure exists.
These strategies do not eliminate anchoring bias outright, but they disrupt its hold by slowing down the automatic, unconscious processing that makes heuristics so powerful in the first place. Encouraging reflective thinking, diversifying points of reference, and prioritizing context over immediacy all contribute to more rational, fair-minded outcomes.
