Cognitive Bias Types That Are Bad For Shopping

Cognitive bias is a type of defect in the human brain that affects logic, comprehension, memory, and other cognitive process. It occurs when people become fixated with their preference and disregard rationality when making an important decision. This influences one's lifestyle and the activities like shopping.

Here are 4 types of Cognitive Bias that affect purchase:

 

Post-Purchase Rationalization

May it be a defective item, a short-lived expensive treat with no practical use or something that serves no purpose at all, many people often make a purchase that they regret later on. Such experience may cause an individual to become overcritical towards him or herself. Some people develop a cognitive bias that serves as a defense mechanism to repel the feeling of regret brought by reckless spending. The Post-Purchase Rationalization is a type of cognitive bias that makes people feel better after making a regrettable purchase. Also referred as Buyer's Stockholm Syndrome, it's a way of subconsciously justifying unwise purchases by convincing one's self that one way or another, the item will become useful. Individuals with this cognitive bias are more likely to create excuses for misspending instead of acknowledging and learning from it..

Anchoring Effect

 One way commercial establishments manipulate the mind of its shoppers into thinking that they set "reasonable" price for their goods and services is through Anchoring Effect. Also known as the relativity trap, it occurs because the human brain finds it challenging to compare across different choices. Due to this difficulty, the mind may likely miss some important details and become prone to deception. People relies heavily on comparing a product to another when determining its worth instead of focusing on its attribute. For example, a smartphone store may offer a used regular smartphone for $60, a regular smartphone (which they claim to be the best deal) for $75 and a premium smartphone for $120. In this scenario, the relativity trap will ensure that most people opt for the regular smartphone. For only $15, costumers can get a brand new smartphone.

However, if the price of the premium smartphone is slashed to $90, a substantial number of people will choose it on the grounds that it is worth paying an extra $15 for a premium smartphone. This is also a deception of relativity trap.

The Current Moment Bias

This type of cognitive bias caught the attention of both economists and health professionals. It is when people choose to indulge in the present and ignore the complications it may bring in the future. Being overly fixated to the present may result to a lack of foresight. For example, an individual who is short in budget may decide to spend for a fancy dinner without thinking that he or she may no longer afford to buy food for the rest of the week.

The Bandwagon Effect

There is a strong correlation between the current trend and business profit. Mainly because a lot of people tend to base their preference in the mainstream idea instead of their own. That is why businesses prefer the type of advertisement that will stir curiosity toward their products. Their aim is to create a fad and attract bandwagoners to jump into it. Next time you find yourself wanting a pair of ripped jeans, maybe it is just a case of cognitive bias.

Here we are at the end of this list. Hope you had a fantastic time reading this article. If you are up for more articles about Psychology, read the false-consensus effect