# The Science of Decision-Making: Heuristics

Every day we use our brains to interact with other people, solve problems and make decisions. Every decision we make has a potential impact on our next decision. A certain decision, and the outcome that follows, could stick with you long after the decision was made and unconsciously determine your next.

To make decision-making more efficient, your brain creates mental shortcuts to help you make the right decision faster. These mental shortcuts are called heuristics, and are a main theme of behavioral economics.

Heuristics are deviations from rationality formed by previous experiences. Instead of relying on the information at hand to make a decision, an individual might reference past decisions or events that may not be directly relevant to the current problem. Stereotyping, “rules of thumb” and the concept of common sense utilize heuristic methods.

Today I’ll focus on three well-known and common heuristics: anchoring, familiarity heuristics and availability heuristics.

Say I’m looking for a movie to see this upcoming weekend. I obviously have a difficult decision to make, as there are several movies showing. I finally decide on a movie, and when my friend asks why I chose that specific film I tell her, “It has Bradley Cooper in it! He’s a great actor!” While this logic seems completely sound to me, it’s not an example of rational judgment. Who else is in the movie? What is the movie about? Did it get good reviews? I did not consider these other options fully when making my decision; I simply saw a “big name” and an actor I’ve enjoyed in the past. A rational individual would (theoretically) consider every aspect of the film before deciding to watch it, while I simply focused on the actor starring in it. Anchoring is the tendency to focus on the first piece of information received when making a decision. Hollywood has relied on our tendency to anchor for decades. If moviegoers see that an actor that they’re familiar with or like is starring in a movie, they tend to have a more favorable opinion of it. Posters and trailers are often used to showcase famous names and faces. And the stars’ awards and accolades are advertised as justification for seeing a film. Anchoring is a common human tendencies, stemming from the idea that the information we receive first is what is most important (e.g. “first impressions”, “what you see is what you get”). It’s very difficult to avoid, even with incentives and/or full awareness of the anchoring effect.

Imagine you’re heading to the grocery store for some snacks. You walk down the snack aisle until you get to the crackers. You see there are three main brands available: Ritz, Cheez-its and Premium Plus. The three brands of crackers have varying flavors, prices, box sizes, ingredients, etc. That’s a lot of variables to consider. You spend all of 30 seconds looking at the cracker selection; grab a box of Ritz and head to the register. Why Ritz? It’s simple: your mom bought Ritz when you lived at home. You are more familiar with Ritz crackers, you’ve eaten Ritz crackers your entire life. Why would you choose any other kind? The familiarity heuristic occurs when an individual chooses to utilize familiar options and processes rather than trying something new. Nostalgia and trial-and-error both utilize the familiarity heuristic. The brands, foods and music you know best are more likely to impact your decisions than those you are unfamiliar with. The familiarity heuristic is a primary focus of consumer behavior: companies want to make sure that you become familiar with their brand early on, to ensure that you will favor their brand over others in the future.