We’ve all heard about FOMO – the fear of missing out.
FOMO is brought on by loss aversion; when we behave in a certain way because we are more motivated to avoid losing something, than gaining that same thing.
Like many similar principles, loss aversion is thought to have its roots in our evolution. Our ancestors faced scarcity and had to make decisions that maximised their chances of survival. Back in the day, the loss of resources or opportunities had a greater impact on their chances of survival compared to similar gains.
Robert Cialdini, in his recent webinar, Win with small changes that deliver big results, talked about how this principle could be used to help customers to see product benefits in a new way. Cialdini cited a study involving a home energy company selling roof insulation services. Rather than express the fuel bill savings from adding more insulation, the company highlighted the ongoing costs if the consumer didn’t install the insulation. This change of approach resulted in a 150% increase in sales.
So next time you are thinking about your brand benefits, think about how you might frame them from a loss perspective. And watch as your customers FOMO drives interest in your brand.