Are you being exploited by the contrast principle?
You can protect yourself from being influenced by the Comparison and Anchoring principles with proper preparation.
One of the most basic, automatic System 1 short-cut is used almost every time we go shopping. It’s why the car salesman offers the extras after you have agreed on the price of the car, or the suit salesperson doesn’t talk about shoes until after he has sold you on a suit. At work is the Contrast Principle.
What is the contrast principle?
The contrast principle is a cognitive bias that affects how people perceive and evaluate things. It refers to the phenomenon where the context in which an object or experience is presented can influence our perception of it. Specifically, when we experience two stimuli in succession, we perceive the second stimulus as being more different from the first than it is. This principle can influence people's perception of value, attractiveness, and desirability by manipulating the context in which stimuli are presented.
The contrast principle can be applied in various situations, such as sales and marketing. For example, a salesperson may show you an expensive suit before showing you the shoes, making the less expensive shoes seem like a better value due to the contrast effect. Similarly, the cost of extras on a car may seem small in comparison to the considerable price of the vehicle. In restaurants, a costly menu item may be listed next to a slightly less expensive one, making the latter seem like a bargain.
Controlling the effects
How do you protect yourself from the anchoring technique? You can use two core tools, the first of which is to control the comparator.
Start by identifying the decisions you want the other person to make and the comparator they may use. Then work to replace it with your comparator. You can do this by making your comparator more available and stretching its envelope by making it better or worse than expected. You can also change the priorities by getting them to compare first quality instead of cost.
The second tool you can use is the Anchoring Principle to your advantage. This cognitive bias refers to relying too heavily on the first piece of information encountered when making decisions or judgments. For example, the initial offer, or anchor, can heavily influence the outcome of negotiations for car extras or shoes. To counter this effect, you can anchor the discussion to your requirements by stating what you're willing to pay before they make an offer.
Using these tools, you can protect yourself from being influenced by these techniques and make better decisions. However, it's important to note that making the Comparison and Anchoring principles work for you requires preparation and planning. Unless you are more knowledgeable or experienced than those who use these techniques for a living, you can likely outsmart them with proper preparation. Be aware that thinking you are smarter than others may be a story you are telling yourself.