Since the twentieth century, with the development of behavioural studies, there has been an uprising of research related to cognitive bias. Over the years, there has been an academic focus on the anchoring bias for a plethora of areas, ending up building a robust foundation in its results. However, when targeting a specific type of anchors - the most extreme ones -, the literature fails to reach a consensus, with some authors finding that extreme anchor present stronger effects, while other researchers find no differences when comparing with non-extreme anchors, whereas some results point towards an anchor losing influence when it is used with extreme values. To overcome this dissonance, my research portraits a price-based experiment that analyses the impact of a high anchor compared to an extremely high one, in three characteristically different markets: Consumer Goods; Luxury; and Charity. This approach aims to demonstrate that the main findings in the literature may not be mutually exclusive, but rather a phenomenon that alters within its context. Moreover, an additional analysis is performed to uncaptured the impact of an extreme high anchor on other perceptions of value besides price, namely quality, emotions, and social awareness. The results reveal that extreme high anchors leads to different results compared to high anchors, in the different markets. Furthermore, the additional analysis suggests that the exposure to an extreme high anchor affects different value perceptions depending on the context. All these results may have managerial strategic implications, for instance, when setting pricing strategies.
- Decision making
- Heuristics
- Anchoring bias
- Extreme anchors
- Valuation
- Context
- Strategy
- Mestrado em Gestão e Administração de Empresas
Shaped by perceptions: the influence of extremely high anchors on consumer valuation
Almeida, Á. G. (Student). 22 Jan 2024
Student thesis: Master's Thesis