Loss hurts. Make it hurt.
As agencies we typically focus on what the client stands to gain by buying our campaign and implementing our recommendation. Flip it over and also get the client thinking about what their potential loss might be by not implementing your recommendation.
Psychologically for most people potential loss is much more motivating to avoid than the equivalent potential gain. Get the client considering how they might miss out.
Ask clients about the impact on their business of not hitting a particular target. Then ask about the impact on them personally of not hitting that target. Get them thinking about a lost or reduced bonus.
Use vivid language. Paint a mental picture in the client’s mind. The clearer the picture, the better. Create a sense of FOMO – Fear Of Missing Out. Some studies have suggested that losses are twice as powerful, psychologically, as gains. We’re not as rational as we like to think we are.
“Losses loom greater than gain” is how Daniel Kahneman and Amos Twersky described loss.
How can agencies use this principle with clients?
Here are 5 classic common agency scenarios where you could use the power of loss with clients.
Ensure the client is crystal clear what they are going to miss in terms of the team’s experience and understanding of their business by moving to another agency.
A new business pitch
Ensure the prospective client understands what they will lose by not going with your proposal, your insights, your understanding of their customers and your team. How can the decision to go with your agency be a ‘no brainer’ in terms of what they will miss out on?
Clients who procrastinate can be expensive for agencies so get them to assess the lost opportunity or lost revenue by delaying or not acting. Spell out that ‘no decision’ is still a decision and in today’s challenging world the client’s competition are likely to seize the opportunity to over-take your client. Emotionally this can be very persuasive to prompt action. If you can quantify the loss you can talk about “for every month delay you will lose £xx,000 in sales or xx,xxx lost customers” This brings the loss into sharp focus.
Client demands a reduction in fees
Outline what the consequences will be in terms of lost access to certain team members and other resources. (Is this risky as there’s an implied threat? Yes, but so are most important business decisions – it’s your choice)
Poor client behaviour
Explain to the client how their behaviour is impacting the team and what the client is going to lose in terms of motivated talent on their business.
Feedback on my articles is very helpful. Let me know how you get on applying this ‘loss strategy’ – what successes or otherwise you experience.no comments