And there it is.
The last slice of pizza. You can feel it calling you, "Have me!" It's seductive.
You salivate and decide you must have it. Oh no... From the corner of your eye, you notice your friend also eye-ing the slice.
You chewed faster on the slice you're having. Ok done!
Let's go for it. You start to reach your hand to pick up the last slice, but alas – your friend is a second faster. You watch him grab the last slice and put it into his mouth. Defeated, you slumped back into your chair, and tell yourself that you're already full anyway.
Why did the last slice become so seductive?
It has to do with loss aversion.
It pain you feel over losing something you own, is 2X more powerful as the pleasure you get from gaining something extra.
- Losing RM100 is more painful than finding a RM100 note.
- Your leads are more likely to buy your solution if it helps them save RM5,000 a month, rather than earn an extra RM5,000.
- Aesthetic service consumers are more likely to buy a solution that promises to reverse aging (avoiding loss of their youth), than a solution that promises that they'll become more beautiful.
Marketing with loss aversion
When we marketed that there were only 120 seats in Underdog Influence Con (it wasn't a lie, btw) we were using loss aversion.
More loss aversion examples
99-night free trial
You can get a 99-night trial from Joey Mattress. But after sleeping and enjoying the mattress for 3 months, you probably don't want to return it anymore. You'll want to avoid losing the mattress and the convenience you already have.
This loss aversion strategy transformed how mattress brands sell their products.
Lock in your price now
You probably know that we use Bonjoro at Daily CMO, to send personalized videos to customers.
Turns out the marketing team at Bonjoro are also experts at loss aversion! From the example above, James is convincing me to convert to an annual subscription, with the premise I don't lose the current cheaper pricing plan.
Limited time only
I love McDonalds.
Not just because of how tasty their burgers are, but because of the many marketing lessons you can learn from them.
Remember the Prosperity burger?
I don't usually eat at McDonald's, but whenever the Prosperity burger returns, I usually find myself with a set. But why?
Possibly because I was trying to avoid losing the chance to have the Prosperity burger. It's only available for 30 days. Stock is limited at every outlet! Quick! It's now or never.
If you really think about it. the Prosperity burger is simply a black pepper burger. Nothing too special, actually. The only special thing was probably the marketing.
Loss aversion is a powerful tool in marketing. Now you know how it works, you'll begin to see it everywhere. Just remember to use it ethically, encouraging people to buy things they only need.