Anchoring

Anchoring refers to a common human tendency to rely too heavily, or "anchor," one trait or piece of information when making decisions such that overly rely on one specific attribute of a thing and judge everything else in relation to that one thing.

When I was a realtor I had clients look at a house. It wasn't perfect but the price was low. I showed the house then checked with the Realtor for the seller. He said it had an accepted offer on it.

We looked at some other houses which were better but more expensive. He could have afforded any of them but now no house was right or him because he had anchored on the price of the first house.

That's anchoring for you. Entrepreneurs need to keep in mind that when a competitor's product is established in the market, most people anchor on it and have trouble accepting something new unless yours is significantly better on things that most people are anchoring on.