Loss Aversion

Loss aversion is a cognitive bias that suggests that for individuals, the pain of losing is psychologically twice as powerful as the pleasure of gaining.

In behavioral economics, this means that losing $100 feels worse than finding $100 feels good. In sales, it means that a prospect is more likely to take action to avoid a loss than to achieve a gain.

How to use it in sales

Most amateur salespeople pitch the "gain." They talk about how much money they will make the client, or how much traffic they will drive.

Master salespeople pitch the "loss." They quantify exactly how much the prospect is losing every single day they delay making a decision.

Example: The "Takeaway" Follow-up

When a prospect ghosts you, do not ask them for an update. Take the deal away.

Hey John, usually when I don't hear back at this stage it means this is no longer a priority. I'm going to go ahead and close the file on this so I stop bothering you. Let me know if things change in the future!

Because of Loss Aversion, if the prospect still has any interest in your services, they will immediately reply to stop you from closing their file. You have triggered their fear of losing you.