Loss Aversion

Loss Aversion is one of the most powerful motivators in human psychology. Put simply, it’s the fear of missing out.

Psychologists have proven again and again that losing $100 dollars devastates people more than finding $100 makes them happy. This is because, for humans, the pain of losing is twice as powerful as the pleasure of winning.

How do marketers use it?

1. Write copy that frames your product as a way to prevent a loss in a person’s life. Make their fear of losing seem urgent and perilous by how you frame it. Use your copywriting to pour salt on the wound.
2. Time-based discounts that make you feel like if you don't buy now, you're going to miss out on savings.
3. Cart-based discounts make you feel like you're losing out on money by not buying more items to unlock the discounts.

The Ambiguity Effect

If someone's website has ever made you feel confused, and you bought from a competitor instead, you’re a victim to the ambiguity effect.

How do marketers use it?

1. Prioritize clarity in your copywriting. Describe your product's features and benefits so simply that a 10-year-old could understand.
2. Predict the questions people will have and provide answers in your copy before they're ever asked.

The Villain Strategy

You’re going to need a bad guy to fight against if you want to be the good guy. The best marketers use the Villain Strategy not only to get customers, but to turn those customers into Raving Fans. In storytelling, villains are so important because they give the hero a reason for existing. Villains also give the audience a reason to root for the hero.

• Mucinex is the hero fighting the common cold
• Patagonia is the hero fighting global warming
• Pepsi is the hero fighting Coca-Cola

How do marketers use it?

1. Pick an issue or a competitor and make them the big bad villain in your marketing campaigns. Show specifically how you, the hero, can defeat them.
2. When your brand outgrows a villain, you can always pick a new one. Apple used to be the hero fighting PC. Now Apple is fighting against privacy invasions.

The IKEA Effect

Let's face it, everyone has an ego, and since Kindergarten, we've been told our effort is worth a lot.

The best marketers know that people tend to place a greater value on things that they helped build.

The Ikea Effect is the phenomenon that people are often willing to spend more money on products that require assembly.

How do marketers use it?

• Add an element of assembly or customization to your products or services. This addition will allow you to charge what would normally be an unjustifiably high price while the customer pays for their own labor. Remember the Build-A-Bear craze? The Ikea Effect is a timeless strategy.