profile

Nudge Newsletter

How loss aversion boosts motivation | Nudge Newsletter 🧠

Published about 2 years ago • 1 min read

Losses motivate more than gains.

Imagine I gave you $4,000 to motivate your sales rep.

You'd probably set them a target like this:

  • Hit 120% of quota and I'll give you $4,000

But...

There's a better way to motivate.

Loss aversion reveals that losses are more salient than equivalent gains.

And when it comes to bonuses, the thought of losing a bonus is more motivating than gaining one.

Here's the study behind this insight 👇

The right way to motivate the sales rep is to say:

  • We've added an extra $4,000 bonus in your pay check this month. If you hit 120% of quota, you keep it. If not, we'll subtract it from future months.

Big thank you to today's sponsor Lately. Don't miss this tech 👇

​Transform Your Social Marketing with Neuroscience-Driven AI™​
​
Lately’s neuroscience-driven AI™ learns and adapts to your unique brand voice to create social media content that your audience will love.
​

  • +12,000% ENGAGEMENT – No, that’s not a typo.
  • +245% MORE CLICKS – More clicks = mo’ better.
  • +200% MORE LEADS – Higher quality leads for marketing and sales.

Our AI schedules and populates your social media calendar faster than you can grab a cup of coffee. ☕️

Want to sponsor Nudge? Here's all you need to know.​

Cheers,

Phill

P.S. I don't listen to many podcasts, but one I tune into religiously is Dan Murray-Serter's Secret Leaders. It's fantastic. If you've got a spare hour this week, I'd reccomend his episode with Mo Gawdat. It's dynamite. Listen here.

This isn't sponsored. I just like the show.

Nudge Newsletter

Phill Agnew

I spend 18 hours each week turning marketing psychology into readable newsletters.

Read more from Nudge Newsletter

Money-Back Guarantees Read online I love this ad. "If the soles wear out before 3,000 miles, we'll replace the shoes free." Customers have become so used to false promises and unrealistic claims that a money-back guarantee like this really stands out. But does it work? The Evidence In 2011, a paper published in the Journal of Retailing studied money-back guarantees¹. 200 consumers saw ads for eight different products. Sometimes the product had a money-back guarantee, plus a guarantee logo....

1 day ago • 1 min read

Social Proof Read online Incredible marketing can be incredibly simple. In 2007, two Chinese researchers ran an experiment at 13 Beijing restaurants¹. Some diners were sat on tables with a plaque listing the most popular dishes. Others were sat at tables with no plaque. Did the plaque change what people choose? Diners who saw the most popular dish plaques were 18% more likely to order one of those dishes, even at a higher price. That's not all. Customers who ate a "most popular dish" rated it...

8 days ago • 1 min read

Labour Looks Smarter Read online Last week I shared one of my unhinged theories with you Many of you rightly pointed out that one study from 2011 is hardly enough to draw lofty conclusions. Fair enough, I've gathered some more evidence. Starting with an imaginary story from my barbers. A good barber is a slow barber Imagine you go to your local barbershop. Your normal barber is on holiday, so you're assigned to someone new. Typically your barber spends 45 minutes cutting your hair. He's not...

15 days ago • 2 min read