There are a myriad of predispositions with which we might struggle or suffer. I have detailed many in my book Unseen Influence: Unconscious Predisposition in Dispute Resolution. I was reminded of the influence of visual representations recently while paying a restaurant bill.
Many establishments provide alternative suggested tip amounts on their bills, and that is not new. But the advent of technology has made that simpler and more convenient than it once was, as many locations now provide a machine for you to swipe your own card and make a payment.
These can be programmed to present any alternative tip amounts. By presenting the alternatives of 18%, 20%, 22%, and 25%, the choices set an expectation, subconscious or not, that these are the only viable selections. This is apropos to multiple predispositions.
That said, there is usually a "Custom" button that allows the user to do their own math, to pick their own tip. What does this have to do with negotiation? To some extent, the parties are doing similarly when they present a demand or offer, whether they know it or not.
First, those suggestions "bracket" some ultimate target. The "bracketing" suggests, subconscious or not, that the "right" number is between them somewhere. There are many mediations that begin with such bracketing, subtle or not. In others, mediators may move the parties to such bracketing purposefully. As the parties progress, some degree of bracketing is inevitable, and likely steered by that first set of numbers.
Second, the presentation of multiple alternatives may also be used to create the Decoy Effect. The human brain tends to react differently to a two-alternative choice than it does to a choice between multiple choices. Classic Decoy involved a third choice, significantly related to one of the primary two, leading to a predicted preference for one of those.
The Decoy Effect is used to steer behavior. In this example, the 25% is both a decoy and an anchor. There is no real expectation that someone will tip 25%, though that could happen. But this array sets a bracket that what is "appropriate" is between 18% and 25%.
For some, it will also foster the perception that rejection of the highest should automatically eliminate the lowest (i.e., I'll be a "moderate" tipper). That conclusion thus leads to the manipulated outcome closer to the center, in this example of 20% to 22%. The higher, 22%, then, is rejected, the 22% "decoy," leading to a 20% tip.
All that said, where do the brackets come from? Some, like Bankrate, contend that the minimum restaurant tip "should be at least 18 percent of the pretax bill," relying on a college professor who claims expertise. That academic offers no support for that opinion, and ignores that many people are simply not capable of calculating 18% in their heads.
American Express suggests instead that "the standard tip percentage for eating out in the U.S. is 15% to 20%," with which Emily Post agrees. Despite these opinions, CNBC reports that the majority of tippers (57%) "tip 15% or less." That certainly does not sound supportive of the academic, Amex, or Emily.
CNBC also noted that the tip is "often due to social approval instead of service quality." This illustrates that payment may readily be about more than the facts. The introduction of a new control group and their reactions support this. The soccer world is traveling this summer and complaining about American tipping culture, according to the BBC (the BBC has had its own credibility problems). If it is true in tipping, why not in settlement negotiation?
An aside is the further complication of trust in the math. Do the "18%, 20%, 22%, and 25%" on that screen really represent that math? There are documented instances in which the math was inaccurate. The example in the picture above shows a check amount of $60.50, for which the restaurant's computer calculates an 18% tip of $29.00. That $29.00 is actually about 48%. As we increasingly rely on computers, as Idiocracy pervades, might one tip 48% out of ignorance or deceit?
The potential for inaccuracy is apparent. This can be because the tip is calculated on an "after tax" total, because it is based on a pre-discount total, because it includes hidden fees, or because it is simply false. And, repeating, there is social pressure not to whip out the calculator, and some part of the population that does not do 18% math calculations in their head.
Thus, the concerns when presented with choices are fourfold. (1) Are you (or others) anchoring to some number, and how will that affect your subsequent perceptions? (2) Where did those number choices come from, and is their formulation and math accurate? (3) Is bracketing impacting your perceptions and focusing you inappropriately? (4) In the multiple-choice setting, are you suffering from the Decoy Effect?
So, how does the payer react to a set of choices like "18%, 20%, 22%, and 25%?" The folks at Bankrate say that only "67 percent of Americans who dine at sit-down restaurants always tip." One in ten finds tipping confusing. The same is likely true for negotiation, such as occurs in mediation.
But the most compelling result in the Bankrate survey is that "34% of U.S. adults are annoyed about pre-entered tip screens." Some, about "25% tend to tip less, or not at all, when they’re presented with the screens." The statements of suggestions or "brackets" can be a turn-off for some people (and both parties in a mediation are people, regardless of the potential to see either as a monolith or edifice).
Thus, there may be a benefit in presenting multiple choices. There may likewise be potential for distraction and distrust. The presentation of math that is inaccurate may cause doubt in negotiation or in relationships generally.
Nonetheless, above all, when a demand or offer is voiced, the speaking party or the listener may become attached to that number(s). This "Anchor Bias" may impede movement from those numbers. Stated simply, people have a tendency to cling to the first information that they acquire. This is a critical consideration when those numbers are first introduced, particularly if they are a great distance apart and from the probable ultimate destination.
