The Power of the Anchoring Effect

The last #innovation mile is one of the important phases of the innovation framework that is supposed to secure the ROI of the whole journey. Price strategy definition is a complex process if when we add the human dimension into it , it could be quite an intimidating process.

𝗧𝗵𝗲 #𝗽𝗿𝗶𝗰𝗶𝗻𝗴 𝘀𝘁𝗿𝗮𝘁𝗲𝗴𝘆 might start with extensive studies, scenarios, projections, market segmentation and powerful algorithms, if the company don’t focus enough on the 𝗵𝘂𝗺𝗮𝗻 𝗽𝘀𝘆𝗰𝗵𝗼𝗹𝗼𝗴𝘆 of decision making, the result can be quite disappointing.

Look at the below survey: When 𝘁𝗵𝗲 #𝗮𝗻𝗰𝗵𝗼𝗿𝗶𝗻𝗴 (reference) is changed , the answer to the question is totally different (𝗮𝗻 𝗶𝗻𝗰𝗿𝗲𝗮𝘀𝗲 𝗼𝗳 +𝟮𝟬%) when the question is the same. In a wide array of situations, people make their estimates from an initial value which is then adjusted to produce the final response, this is called Anchoring effect.

𝗧𝗵𝗲 𝗮𝗻𝗰𝗵𝗼𝗿𝗶𝗻𝗴 𝗲𝗳𝗳𝗲𝗰𝘁 is quite powerful, it could be also used in an organisational and managerial environment, referring to the values , best practices that the company implement and promote.

Many companies set the objective to serve employees internally with the same quality and dedication they serve external customers . This anchoring ( value reference) resonate highly with employees and make them 𝗺𝗶𝗿𝗿𝗼𝗿 𝘁𝗵𝗶𝘀 𝗶𝗻𝘁𝗲𝗿𝗻𝗮𝗹 𝘃𝗮𝗹𝘂𝗲 with a delivery that is reflecting the care and the high consideration they receive.

#theinnovationjourney #behaviouraleconomics #anchoring #anchoreffect #thelastmile