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You’ll regret not reading this article.

Daniel Kahneman, a Nobel prize winner for his work in behavioural economics, died last month at the age of 90. Along with Amos Tversky, in proposing the psychological and economic concept of loss aversion, he suggested that losses can be twice as powerful psychologically as gains. It’s one of many ideas of Kahneman’s that we can apply to our everyday work.

What it suggests we consider is the potential loss of not purchasing a product or service, rather than the benefits of purchasing it. This is why it’s effective to highlight limited-time offers or exclusivity to create a sense of urgency, prompting customers to act quickly to avoid missing out. It taps into the desire to avoid the loss of a good opportunity.

The concept works. However, the customer has to believe there’s something to lose. If we do it too often, common sense tells us it will fail. Conversely, if we surprise customers with the approach, it can be exceptionally effective.

Some people associate this sort of marketing with stretching the truth, but that’s incorrect. If we’re down to the last few items in stock, and we sell them by telling customers they need to buy now or lose the opportunity forever, that’s just fact.