Primacy and recency effects

The power of first impressions

Primacy and recency effects

Did you know that the order of information presented to you influences your working memory? It’s known as serial position effects. Said more simply: items presented first get first dibs on your short- term memory. But the last item on the list? That one needs some time to work in its favour. What am I talking about? I’m talking about primacy and recency effects.

  1. Primacy effect
  2. First-impression bias
  3. Meetings, votes & car launches
  4. But there’s a twist in the tale
  5. Recency bias
  6. The proof is in your investment decisions
  7. Primacy and recency effects

Primacy effect

Let’s say you have a date lined up, but you need to choose between two people who’ll accompany you…

The first date option is envious, stubborn, critical, impulsive, good-looking, and intelligent.

The second date option is intelligent, good-looking, impulsive, critical, stubborn, and envious.

Who would you pick to go on the date with you?

Primacy and recency effects

Primacy recency effect definition

Are you picking option 2? Most people do.

However, did you notice that both people were described with identical words. They were just in a different order.

Arguably, one of the oldest experimental psychology studies was performed by Solomon Asch in 1946. He did exactly what the above example does: asked participants to rate people based on a collection of words (some positive, some negative). Results showing that participants rated the person with positive characteristics at the start of their description higher than those whose positive characteristics came at the end of their description.

Primacy effect is defined as our tendency to better remember facts, impressions, or tasks that are presented first, rather than those presented later in a sequence. Click To Tweet

More commonly, in social contexts, you can call it the first-impression bias.

First-impression bias

It’s not an old-wives-tale, first impressions do matter. You’ll remember the first time you meet someone, more so than the 2nd and 3rd encounters, primarily because of the primacy effect.

You never get a second chance to make a first impression.

Oscar Wilde (allegedly)

This is why any interview checklist will tell you not to arrive late. It doesn’t leave a good first impression. You’re not doing yourself any favours. Once recruiters reflect on your interview and application, they’re likely to remember that you came late more than anything else. Dressing too casually or having grammar and spelling mistakes on your application form are similar examples of things NOT to do. Creates a bad first impression.

But why? It’s because of how our human memory responds to primacy and recency effects.

Do you only remember the first few things at the top of a grocery list? You’re not alone.

It takes less processing power for our brains to practice and free recall a single item (the first item on the list) than multiple items (all the items after that first item and including that first item). Research has shown that when we read a series of statements, the amount of time we spend reading each statement declines with every new piece of information. Thus, it is no surprise to hear that we are more susceptible to primacy effect when we are tired and distracted (compared to when we are wide awake and pay attention).

Primacy effect psychology - full mental health

Primacy effect psychology - full mental health

Do you only remember the first few things at the top of a grocery list? You’re not alone.

It takes less processing power for our brains to practice and free recall a single item (the first item on the list) than multiple items (all the items after that first item and including that first item). Research has shown that when we read a series of statements, the amount of time we spend reading each statement declines with every new piece of information. Thus, it is no surprise to hear that we are more susceptible to primacy effect when we are tired and distracted (compared to when we are wide awake and pay attention).

Meetings, votes & car launches

Recency and primacy effect in meetings

The impact of primacy effect has far-reaching implications. But with the awareness of it, you can subtly make it work in your favour.

Consider you’re in a meeting and there’s a point on the agenda upon which a decision needs to be made. The first opinion that is heard will likely influence everyone’s assessment. Thus, if you have an opinion, make it first, and influence your colleagues in that direction (nudge, nudge).

But, if you are chairing the meeting, ensure that you take opinions in a random order so as not to give anyone an unfair advantage. (You’re all thinking of that person that talks first in meetings now, aren’t you? If not… that person might be you!)

The impact of primacy effect has far-reaching implications. But with the awareness of it, you can subtly make it work in your favour.

Consider you’re in a meeting and there’s a point on the agenda upon which a decision needs to be made. The first opinion that is heard will likely influence everyone’s assessment. Thus, if you have an opinion, make it first, and influence your colleagues in that direction (nudge, nudge).

But, if you are chairing the meeting, ensure that you take opinions in a random order so as not to give anyone an unfair advantage. (You’re all thinking of that person that talks first in meetings now, aren’t you? If not… that person might be you!)

Recency and primacy effect in meetings

Several studies have examined this bias in elections. Time and again, the candidate who is listed first, implying that they appear first online and any associated material on them is made available first, were more likely to win the vote than the other candidates. Politicians who open a debate with a strong argument are more likely to have their message get across than those that are heard in the middle of the debate.

For those of you that like to run polls on LinkedIn, perhaps consider the order of response options next time? I can assure you – marketers are using this cognitive psychology bias against you all the time!

Primacy effect and voting - Primacy effect in psychology

Several studies have examined this bias in elections. Time and again, the candidate who is listed first, implying that they appear first online and any associated material on them is made available first, were more likely to win the vote than the other candidates. Politicians who open a debate with a strong argument are more likely to have their message get across than those that are heard in the middle of the debate.

For those of you that like to run polls on LinkedIn, perhaps consider the order of response options next time? I can assure you – marketers are using this cognitive psychology bias against you all the time!

Primacy effect and voting - Primacy effect in psychology

Primacy effect example

When releasing a new product, marketing departments take advantage of the primacy effect by curating something known as a ‘launch’. It usually includes a bit of pre-promotion (ensuring that the first thing you hear about the product is all good stuff) followed by the theatre-like extravaganza of the official launch. Thus, they control the message and design the perfect first impression. Think: Apple, Tesla…

If retailers (particularly the online players) want you to click on something, they’ll put it first. It doesn’t matter if the list is top-to-bottom or left-to-right, and (usually) it doesn’t really matter if you can see the whole list or if you’re only seeing one item at a time. If you’re being nudged to click, the item will be first on the list.

When releasing a new product, marketing departments take advantage of the primacy effect by curating something known as a ‘launch’. It usually includes a bit of pre-promotion (ensuring that the first thing you hear about the product is all good stuff) followed by the theatre-like extravaganza of the official launch. Thus, they control the message and design the perfect first impression. Think: Apple, Tesla…

If retailers (particularly the online players) want you to click on something, they’ll put it first. It doesn’t matter if the list is top-to-bottom or left-to-right, and (usually) it doesn’t really matter if you can see the whole list or if you’re only seeing one item at a time. If you’re being nudged to click, the item will be first on the list.

Primacy effect example

But there’s a twist in the tale

Primacy effect has some competition. Consider a study by Miller and Campbell where participants were presented with two arguments in a trial. One argument was for the plaintiff accused of a crime, and the other argument against. In some of the trials, the order of the arguments was switched. And in other trials, there was a delay in time between hearing the two arguments.

Consider that the first argument was for the plaintiff and the second against.

When there was no delay between the first and second argument, the participants voted in favour of the plaintiff (primacy effect). That’s the power of opening statements right there.

However, when there was a delay between the first and second argument, the participants voted against the plaintiff. Introducing – the recency effect.

Recency bias

Contrasting to the primacy effect is the recency effect.

Recency effect refers to how we place too much emphasis on current experiences or situations and not enough on long-term historical patterns. Click To Tweet

The more recent information is, the more likely we’ll be able to remember it. That gives the last items on the list a fighting chance!

In a fight between primacy effect and recency effects, who would win? Generally, if you have to make an immediate decision based on sequential observations (consider the characteristics of that potential date, or the opinions in the meeting) then the primacy effect dominates. But if the observations were some time ago, the recency effect carries more weight. If you watched a Netflix series a few months ago, you’re more likely to remember how it ended, than the first episode.

Graph of primacy effect and recency effect

Primacy vs recency effect - Recency bias definition

Of course, it’s important to always remember that the status quo will often trump any choices and the compromise effect can also have a powerful influence. But these biases do have an element of interplay.

The proof is in your investment decisions

Recency bias creates a lot of problems in our investment decisions, and it’s a difficult bias to overcome. To not focus on recent events that you’ve experienced is a tough ask. But the problem arises when we start taking new information and overwriting old memories with it.

A perfect example of this is the trading behaviour that is seen when a negative shock (such as the pandemic or the current geopolitical tension) hits the financial market. Because prices are falling, many investors panic. This results in a combination of sales and adjustments to investment approaches i.e., more in cash which is safer. What is risky about this is that situations don’t carry on forever. There’s nothing wrong with reassessing your investment approach in light of a change of events but be careful that you’re not being influenced by a recent occurrence that might not be sustained.

Recency effect meaning - Investment decisions

Recency bias creates a lot of problems in our investment decisions, and it’s a difficult bias to overcome. To not focus on recent events that you’ve experienced is a tough ask. But the problem arises when we start taking new information and overwriting old memories with it.

A perfect example of this is the trading behaviour that is seen when a negative shock (such as the pandemic or the current geopolitical tension) hits the financial market. Because prices are falling, many investors panic. This results in a combination of sales and adjustments to investment approaches i.e., more in cash which is safer. What is risky about this is that situations don’t carry on forever. There’s nothing wrong with reassessing your investment approach in light of a change of events but be careful that you’re not being influenced by a recent occurrence that might not be sustained.

Recency effect meaning - Investment decisions

primacy and recency effects

The primacy effect is valuable. It helps us to remember the importance of first impressions. But be careful of making unfair comparisons. Evaluate things impartially. Consider how the order of candidates, questions, and reviews influence your relative decisions.

Be careful of assigning a heavier weight to the more recent information you have, rather than older data. The market will not always look the way it looks today. Don’t make unwise decisions because of where the market finds itself at a point in time.

Also, it’s worth mentioning that the jury is still out regarding the impact of primacy and recency effects in verbal learning. When you’re reading – definitely! But when you’re listening, there is an argument to say that verbal behaviors differ. And perhaps, recency trumps primacy!

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More in this series on behavioural biases

In case you missed it, see our previous posts in this series:
  • Heuristics and biases in decision making – This was the first post in the series which shares some behavioural economics research. Specifically, the heuristics and biases that influence our relationship with money. It uses System 1 and System 2 thinking examples from Daniel Kahneman’s New York Times best selling book, Thinking Fast and Slow, to help us be more conscious of the workings of our brain. 
  • Mirror, mirror, on the wall, stop telling me I’m wonderful – This post focuses on the impact of overconfidence bias in decision making. It introduces the illusion of knowledge bias and the illusion of control bias to illustrate the difference between confidence and carelessness. It also discusses the better than average effect, the self-serving bias and fundamental attribution error. You’ll learn how to confront some unpalatable truths and get out of any false sense of comfort (if you’re up for the challenge?).
  • Why you can’t argue with a vegan – Ballsy title, we know. But if you read the post you’ll (hopefully) understand why. We’ll be discussing confirmation bias. It’s one of those psychological biases that you can see everywhere. We’ll also touch on cognitive dissonance theory. We all struggle with these biases. They’re both humorous and serious. But because of that, it’s useful to know how to avoid confirmation bias when you need to.
  • Size does matter… when it comes to framing – This post uses framing effect examples to show how framing bias influences the way we interpret information and make decisions. We discuss glossing, the compromise effect, and how the size of the frame can influence the volatility of your investment portfolio.
  • Loss aversion vs risk aversion – Once you understand framing, you’re ready for this post. It introduces an incredibly powerful bias known as loss aversion. It also touches on prospect theory, the disposition effect and impression management.
  • Anchors pulling you down? – Anchoring bias is a straightforward behavioural bias that causes us to focus on a certain initial value and then make decisions with reference to it. This post looks at some examples of this anchoring effect.
  • The danger of the default – Default options nudge us to make better decisions. The option of opting out also respects freedom of choice. This post unpacks this notion of libertarian paternalism and the perils of status quo bias.
  • Regret, it’s not a nice feeling – Regret influences the decisions we make and pushes us to conform to social norms. Examples of regret avoidance show us how this makes complete sense yet no sense at all.
  • When the past influences the futureThe Concorde effect is a famous example of sunk cost investment. Too often we invest time, money and energy into something we should’ve just abandoned. This post looks at some examples of how sunk cost fallacy affects our human decision processes.
  • What’s mine is more valuable – In this post, you’ll learn why you place extra value on things you own. The endowment effect has implications for our investment portfolio, bonuses and consumer behaviour.
  • How to improve self-control – Self-control is an essential life skill. It’s what separates humans from the rest of the animal kingdom. Learn how to improve self-control to achieve your long-term goals.
  • Procrastination is the enemy of success – We know procrastination is the enemy of success. But while it looks like laziness, it’s often just mental exhaustion at play. Learn how to overcome procrastination.
  • The problem with wanting it now – When you delay instant gratification, you will experience long-term satisfaction. It’s the hyperbolic vs exponential discounting debate. Don’t let present bias win!
Or if you want to jump ahead...
  • Learn to deal with uncertainty – Risk and uncertainty will always surround us. Gambler’s Fallacy, the hot-hand effect, the law of small numbers & ambiguity aversion are just some of the biases that arise because of it.

Consider the impact of primacy effect with professional medical advice?

Can you recall an unfair judgement you made based on the order of information?

Let us know in the comments on primacy and recency effects below.

Influenced by recent events?

Making investment decisions because of current market sentiment?

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About the Author

I am passionate about helping people understand their behaviour with money and gently nudging them to spend less and save more. I have several academic journal publications on investor behaviour, financial literacy and personal finance, and perfectly understand the biases that influence how we manage our money. This blog is where I break down those ideas and share my thinking. I’ll try to cover relevant topics that my readers bring to my attention. Please read, share, and comment. That’s how we spread knowledge and help both ourselves and others to become in control of our financial situations.

Dr Gizelle Willows



Dr Gizelle Willows

 

PhD and NRF-rating in Behavioural Finance