Why does a $1,000 handbag seem like a bargain after seeing a $5,000 designer purse in the same store? Why do restaurant menus list an $80 steak right before a $40 entree—making the latter seem like a steal?

These aren’t accidents. They’re anchoring strategies—a powerful psychological pricing tactic that shapes customer perceptions of value and drives buying decisions.

If you want to increase conversions, boost sales, and make your pricing irresistible, it’s time to master the art of anchoring.

🔹 What Is the Anchoring Effect?

The anchoring effect is a cognitive bias where people rely heavily on the first piece of information (the anchor) they see when making decisions. Once the anchor is set, every option that follows is compared against it, shaping how reasonable or expensive a price appears.

Example:

• A $100 bottle of wine feels expensive—until you see a $300 bottle listed next to it. Suddenly, the $100 option feels reasonable and becomes the likely choice.

Smart businesses intentionally set an anchor to influence how customers perceive value.

🔹 The Science Behind Anchoring in Pricing

🔬 Studies show that anchoring affects everything from how much people are willing to pay to what they consider a fair deal.

✅ A famous experiment by behavioral economist Dan Ariely found that when people were shown a random two-digit number before bidding on items, those with higher numbers bid significantly more—proving that our brains cling to the first number we see when evaluating cost.

✅ Retailers use this all the time. Ever notice how high-priced items are strategically placed near mid-range options? It’s no coincidence—it’s anchoring in action.

🔹 How to Use Anchoring to Drive More Sales

Want customers to perceive your prices as fair and irresistible? Here’s how to do it right.

1. Use High-Priced Anchors to Make Other Prices Look Like a Steal

💡 Strategy: Start by showing a premium-priced product first, making lower-priced options seem like great value.

✅ Example:

• A software company offers three plans: $499/year (Premium), $299/year (Standard), and $99/year (Basic).

• Most people choose the $299 plan because it seems like the “best deal” compared to the high-priced anchor.

👉 Why it Works: The Premium price sets a mental comparison point, making the mid-tier option feel like the best value.

🔹 Where to Use It:

• Subscription pricing (Basic, Pro, Enterprise).

• Service packages (Gold, Silver, Bronze).

• Product menus (Luxury, Standard, Economy).

2. Show the Original Price Before Discounts

💡 Strategy: Always display the higher original price next to the discounted price.

✅ Example:

• “Was $150 – Now Only $99!”

• “Retail Price: $250 | Our Price: $149”

👉 Why it Works: The strike-through price serves as the anchor, making the discounted price feel like a huge savings.

🔹 Where to Use It:

• E-commerce product pages.

• Retail promotions & sales.

• Limited-time offers.

3. Create a “Decoy” Option to Steer Customers Toward Your Preferred Choice

💡 Strategy: Introduce a decoy option that makes your target offer look like the best deal.

✅ Example:
A popcorn stand offers:

• Small: $3

• Medium: $6

• Large: $6.50

Most people choose Large because it seems like a steal compared to Medium. Without the Medium option, Large would feel expensive—but now, it’s the obvious choice.

👉 Why it Works: The Medium size is a decoy—placed there only to make Large look like the best value.

🔹 Where to Use It:

• Subscription pricing (add a barely different mid-tier plan).

• Product bundles (offer a slightly inferior version at a close price).

4. Bundle Products to Increase Perceived Value

💡 Strategy: Instead of pricing items individually, offer bundles with a clear savings anchor.

✅ Example:

• Gym membership: $50/month OR $500/year (2 months free!)

• Software package: $49/month OR $399/year (Save $189!)

👉 Why it Works: The yearly option becomes the anchor, making the monthly price feel more expensive by comparison.

🔹 Where to Use It:

• SaaS (annual vs. monthly pricing).

• Online courses (course bundle vs. individual classes).

• Memberships & subscriptions.

5. Display a High-Price “Prestige” Option

💡 Strategy: Even if few people buy it, listing a luxury, premium, or VIP option helps increase perceived value across all other options.

✅ Example:

• A restaurant offers a $200 chef’s tasting menu, making the $60 dinner entree feel affordable.

• A car dealership showcases a $100,000 luxury car, making the $50,000 sedan feel reasonable.

👉 Why it Works: The premium item redefines “expensive” in the customer’s mind, making other choices seem more reasonable.

🔹 Where to Use It:

• High-end retail.

• Service-based businesses (VIP packages).

• Hospitality (luxury suites vs. standard rooms).

🔹 Common Mistakes to Avoid in Anchoring

🚨 Mistake #1: Setting the Anchor Too Low

• If your first price is too cheap, it lowers the perceived value of everything else.

🚨 Mistake #2: Too Many Choices

• Too many options lead to decision paralysis. Stick to 3-4 well-structured pricing tiers.

🚨 Mistake #3: Overusing Discounts

• If everything is always on sale, your anchor price loses credibility. Make discounts strategic, not constant.

🔹 Final Thoughts: Price Is Perception—Shape It Wisely

The way you present pricing matters more than the price itself. By leveraging the anchoring effect, you can make your product feel like the best possible deal—without actually changing the price.

🚀 Next Step: Review your pricing strategy and ask:
✔ Are you setting a high-value anchor first?
✔ Are your discounts clearly framed for maximum impact?
✔ Do your options guide customers toward the best-value choice?

Master these tactics, and you’ll start seeing more customers saying ‘YES’ to your offers.

💬 Which anchoring strategy has worked best for you? Drop your thoughts in the comments!