Each time I’ve trailed through an airport bookshop this year it’s been hard to miss the latest tome of uber-psychologist, Daniel Kahneman.
Driving around England Friday I was keen to listen to him on Desert Island Discs.
Despite his main field, he even won a Nobel prize for Economics for his work on one of my favourite theorems that impacts Sales, Prospect Theory.
When I got home, I couldn’t believe my luck that the segment where he talks about that had its own clip for re-play.
His insight stems from realising the power of Loss Aversion; “people are much more sensitive to losses than equivocal gains”. And to make a ‘gamble’ palatable, the possible gain must be at least twice that of the potential loss.
Here’s the last few seconds of his 2’10” clip;
“From prospect theory you’d have to say that most attempts to reform society are going to have a lot of difficulty.
Because any attempt to reform is going to involve winners and losers.
And the winners are going to fight less hard to achieve their gains than the losers are to protect what they have.
And as a result reforms will always be distorted in favour of potential losers.
And they will be more expensive than they were intended to be and sometimes they will fail altogether.
And this happens time after time.
Potential losers fight a great deal harder than potential winners.”
At face value, switch the idea of ‘reform’ for your proposed bid and your eyes open to a whole new minefield of realpolitik.
If the ‘winners’ are your advocates prospect-side, and the losers those less disposed to your project’s charms, then how are you going to manoeuvre your champs to negate the doubters?
Then I got to thinking about a sale often being up against the status quo as its main competition. In this case, perhaps those on board feel if nothing changes, then they’ll be big losers and so inclined to ‘fight harder’?
A clear positive for your ambitions.
In either case, the point is critical that it is the perception of anyone touched by the campaign that is so important. Which do they feel they’d be?
When you know that, you’re well on the way to being able to act on how you calm losers’ fears and mobilise winners’ energy.
Possibly the best learning here, is that if you share those last couple of Danny Kahneman’s sentences with your ‘winners’, then they’ll likely rush to think up ways how they can counter the ‘losers’ extra effort against them.