Anchoring price refers to the initial price set for a product or service, which serves as a reference point for all subsequent pricing decisions. This price is often based on factors such as production costs, market demand, and competition. It acts as a psychological anchor for consumers, influencing their perception of the product’s value and potential discounts. Businesses strategically use anchoring price to attract customers, create a sense of urgency, and ultimately drive sales. However, it is important for businesses to regularly reassess and adjust their anchoring price to stay competitive in the ever-changing market.