This bias explains why we over value what we already have. We feel the pain of losing something we have almost twice as much as the enjoyment of getting something new. So, we’ll go out of our way and take disproportionate risks to avoid losing something.   Brands can use this to their advantage by focusing on what a customer could lose by switching to another brand.

Just don’t waste $1500.

On a mission to end food waste, Save The Food focused on consumer’s personal loss with their award-winning 2016 campaign. They struck a chord by highlighting the amount of money people throw away on uneaten food every year, which would have been twice as powerful as presenting the message as a gain, eg: “Save $1500 per year”.

Save The Food, Loss Aversion
Save The Food's 2016 campaign, sourced from The Drum

You snooze, you lose out

To remind people to renew their tax credits by 31st July, HM Revenue & Customs released roadside adverts with a strong message. By not renewing their tax credits in time, people faced the risk of losing their money, so HMRC got straight to the point. Renew or lose out? You decide.

What is Behavioural Economics?

Behavioural Economics has been around since the 60s. It blends elements of psychology and economics to identify the mental triggers, or bias, nudges and heuristics, that affect the decisions people make.

This blog series is your go-to guide for a snapshot into what these triggers are, and how they can be used in marketing to influence consumer behaviour.

HM Revenue & Customs, tax credits
HM Revenue & Customs, "Don't Lost Your Tax Credits" ad

A bit about us

As an agency, influencing behaviours is core to what we do and applying Behavioural Economics to marketing communications is a natural progression. If you are interested in understanding more about how we do this get in touch now.

Find out more about the connection between consumers and behavioural economics in our latest report on the top trends driving consumer behaviour. Download it here.

By Phil Monks

Deputy Creative Director