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Steve Jobs introducing iPad: the anchoring effect in action
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The anchoring effect is a cognitive bias for an individual to rely heavily on the initial piece of information offered when making a decision.
After showing the features, Jobs asks what should we price at? If we listen to the pundits, we should price it at $999.
He let it there sink before saying, 'I am thrilled to announce to you that the iPad pricing starts not at $999 but at just $499’.
Then the $1000 gets crushed by a giant $499.
What Jobs did so well was not to compare the iPad price with that of a notebook - he compared it with the expectation of its own price.
This anchoring mechanism by which price perception can be influenced by contrasting with other prices, it’s very effective.
🔴 Learn More About the Psychology of Persuasion:
After showing the features, Jobs asks what should we price at? If we listen to the pundits, we should price it at $999.
He let it there sink before saying, 'I am thrilled to announce to you that the iPad pricing starts not at $999 but at just $499’.
Then the $1000 gets crushed by a giant $499.
What Jobs did so well was not to compare the iPad price with that of a notebook - he compared it with the expectation of its own price.
This anchoring mechanism by which price perception can be influenced by contrasting with other prices, it’s very effective.
🔴 Learn More About the Psychology of Persuasion:
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