The sunk cost fallacy is a cognitive bias in which people are more likely to continue investing in a decision or project because they have already invested a significant amount of time, money, or effort into it, even if it is not in their best interest to do so. The best salespeople understand this bias and use it to their advantage to sell more effectively. Here are a few ways they do it:
- Emphasize the investment: The best salespeople emphasize the investment that the customer has already made in their product or service. They remind the customer of the time, money, and effort they have already put in and suggest that it would be a waste to abandon it now.
- Create a sense of obligation: The best salespeople create a sense of obligation in the customer to continue investing in their product or service. They suggest that because the customer has already invested so much, they have a moral or ethical obligation to see it through.
- Use fear of loss: The best salespeople use fear of loss to encourage the customer to continue investing in their product or service. They suggest that if the customer abandons the investment now, they will lose all the progress they have made and miss out on future opportunities.
- Highlight potential rewards: The best salespeople highlight potential rewards that the customer could receive if they continue investing in their product or service. They suggest that if the customer keeps investing, they will eventually see a return on their investment, whether that be in the form of financial gain, personal growth, or some other benefit.
- Provide a way out: The best salespeople provide a way out for the customer if they decide to abandon the investment. They suggest that if the customer is not satisfied with their product or service, they can always cut their losses and move on. By providing an exit strategy, they make the customer feel more comfortable continuing to invest.
By understanding and using the sunk cost fallacy, the best salespeople can tap into the customer’s reluctance to abandon an investment and increase the likelihood that they will continue investing in their product or service. However, it’s important to note that using this bias in an unethical or manipulative way can damage the relationship between the salesperson and customer in the long term.