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Anchoring and comparisons related to value
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Anchoring and comparisons related to value

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We don't really know the value of something unless we can compare it to something else. Using framing and comparison to determine the value of things.

We don't really know the value of something unless we can compare it to something else. Using framing and comparison to determine the value of things.

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  • {"5":"Donations higher when options were $100, $250, $1,000, and $5,000 than if the options are $50, $75, $100, and $150 dan arielly\nLawyers suing businesses in product liability cases, can get high jury awards if they succeed in getting jury members to anchor on multi-million dollar figures\n","6":"“Williams-Sonoma, a mail-order and retail business located in San Francisco, used to offer one home bread maker priced at $275. Later, a second home bread maker was added, which had similar features except for its larger size. The new item was priced more than 50% higher than the original bread maker. Williams-Sonoma did not sell many units of the new (relatively overpriced) item, but the sales of the less expensive bread maker almost doubled.”\n","12":"Object: To look at our pricing policies as many customers use comparisons to shop\nScope: Look at psychology and pricing trends\n","1":"Object: To look at our pricing policies as many customers use comparisons to shop\nScope: Look at psychology and pricing trends\n","7":"http://www.beefeaterbbq.com/Product-Range/Signature-Series/Signature-SL/6-Burner/6-Burner/default.aspx\nIs this grill expensive?\n","2":"Standard economics assumes that a consumer knows what he/she would be willing to pay for any given commodity\nBehavioural economics shows that consumers generally have no clue what a given object is worth to them\nConsumers tend to estimate their willingness to pay for an object by using irrelevant information about other objects\nIf there is a disconnect between what we are willing to pay for a commodity and some objective measure of the benefit obtained from that commodity, part of the case for the supremacy of free market-based economic systems loses validity\nA government, for instance, could impose price control, arguing that, as prices are arbitrary, price control could not have serious negative effects\n","8":"http://www.beefeaterbbq.com/Product-Range/Signature-Series/Signature-SL/6-Burner/6-Burner/default.aspx\nHow about now?\n","3":"Findings: Prices are based on comparison \n1. Subject witnesses the number that comes up when a wheel of fortune is spun\n2. Is asked whether the number of African countries in the U.N. is greater than or less than the number on the wheel of fortune\n3. Is asked to guess the number of African countries in the U.N. \nD. Kahneman and A. Tversky (1974), “Judgment under uncertainty: heuristics and biases,” Science, 185: pp. 1124-1131.\n","9":"http://www.beefeaterbbq.com/Product-Range/Signature-Series/Signature-SL/6-Burner/6-Burner/default.aspx\nAnd now?\n","4":"College students were asked the following questions in sequence:\nHow happy are you? \nHow often are you dating?\nThe two answers showed a low correlation (0.11)\nThen the question sequence was reversed:\nHow often are you dating?\nHow happy are you? \nThe two answers showed a high correlation (0.62)\nThe answer to the dating question (objective and easily determined) acted as an anchor to the happiness question\n","10":"http://www.beefeaterbbq.com/Product-Range/Signature-Series/Signature-SL/6-Burner/6-Burner/default.aspx\nhttp://www.beefeaterbbq.com/News/News-Articles/What-The----a-Gold-Barbecue-/default.aspx\nAnd now?\n"}

Anchoring and comparisons related to value Anchoring and comparisons related to value Presentation Transcript

  • Create comparisons
  • Willingness to pay 2
  • Anchoring experiment How many African countries in the U.N. ? Spin Result: those with higher numbers on the wheel guessed higher numbers to question 3
  • How happy are you? 4
  • Increasing charitable donations
  • Williams-Sonoma bread maker
  • Expensive? R49,984.05 from www.barbecue-grill-guide.com Beefeater Signature SL - 6 Burner BBQ
  • R49,984.05 R56,299.00 from www.barbecue-grill-guide.com Beefeater Signature SL - 6 Burner BBQ
  • R49,984.05 R56,299.00 from www.barbecue-grill-guide.com Beefeater Signature SL - 6 Burner BBQ
  • R49,984.05 R56,299.00 from www.barbecue-grill-guide.com Beefeater Signature SL - 6 Burner BBQ R112,500.00 Beefeater Signature SL - 6 Burner BBQ: Gold Plated Edition
  • 1
  • Create comparisons