Anchor Points

In chapter two of the book Predictably Irrational, Ariely discusses price point anchors. A price point anchor is the price you are expecting to pay for an item based on the first price you saw that item marked at. For example, I go to the store to buy bread and the first loaf of bread I see costs five dollars I having never bought bread before think okay this is what it costs to buy bread. The five dollars is now my anchor so next time when I go to a bigger store that has many different options and price points of bread I am shocked to see that I can get two loaves for only four dollars at this new store. Because my anchor was so high before, this price is amazing to me and will keep me coming back. So his real point is that all prices are relative, we don’t really know how many dollars a loaf of bread should cost until we see the available prices at other stores. However, the first price we see for any given product becomes our anchor point and that is often what we compare all the other prices we encounter to. I found this to be a very interesting chapter because it happens to me very often. I never noticed this before, so I started to wonder if there is anything else that might be affected by anchor points in life.

What hit me after thinking about this subject was my daily productivity. What I mean by this is how I start my day. I’ve noticed recently that when I start my day off by watching Netflix or YouTube videos, playing video games, or even spending the morning looking over social media, my tendency is to want to continue those activities and I never get a lot done. However, if I were to start my day off by reading a chapter in a book or reading the news, even if it’s for only 15 to 20 minutes, I seem to be much more willing to do my homework and be overall more productive in the day. It’s as though the way I start my day serves as the anchor point for the rest of my day - just as I expect all prices to be similar to the first one I see.

Contrary to the price point anchors though, I’ve noticed my productivity anchor is not as fixed as price anchors are. In the book, Ariely mentions that it takes a long time for people’s price point anchors to change, but with my productivity, I could start the day off lazy and when I come back from class as long as I begin my afternoon doing something productive it will be much easier for me to accomplish all my other tasks. The opposite rings true for me as well though. If I get back from class and watch an hour or two of Netflix, I’m a lot less likely to get much done for the rest of the night.

I have no real proof that this is true for every person, but it certainly is for me. If you are reading this and you are skeptical, the next time you have a big day ahead of you, get up and read the news or a little out of a book instead of spending time on social media or some other time wasting activity. Then continue on with your day and see if it makes a difference for you.