anchor pricing

Anchor pricing is a marketing strategy where a seller sets a reference price, or "anchor," to influence a buyer's perception of value. For example, if a product is listed at $200 but is marked down to $150, the original price serves as an anchor, making the discount seem significant and tempting. This tactic leverages cognitive bias, leading consumers to judge the value of the deal based on the anchor price rather than the product's true worth. It's designed to create a sense of urgency and encourage purchases by highlighting perceived savings.