M7

Loss aversion

» Frame benefits as losses that people will give up » Give people a sense of what it will be like to have the benefits » Show the immediate losses that the individual with incur

Research. Consumers were either asked to build up a pizza by adding toppings, like pepperoni and mushrooms, or to scale down from a fully-loaded pizza with all toppings.Consumers that were assigned the fully-loaded pizza ordered more expensive pizzas since they didn’t want to lose their toppings.

Levin; et al. (2002), A Tale of Two Pizzas

“Losses loom larger than gains.”

Pairing. Combine with (O2) Endowment effect.