11k people were offered a new job that had a 50% chance of doubling income for life, but it wasn't without risk, with an equal chance of it falling by either 20, 33 or 50%. Questioning started with the 33% gamble; if people took it, they were asked if they’d take the bigger 50% gamble too. But if they didn’t, they were asked about the smaller 20% one.

Results put people into four risk categories showing the majority were not willing to take any risk at all.

Focus on an improvement metric. 

We prefer the certainty of what we’re used to, so the benefits of switching to a new product need to feel substantial.

Outline a goal (relative performance, efficiency etc.) to anchor your product strategy around.

Doing so will reduce uncertainty and boost comparisons against better-known, lower risk alternatives.

Offer a trial or free sample...

...to create familiarity and reduce the risk around a new product.

This sets the cost of new product usage at zero, during which the consumer will adjust their future preferences.

Utilize your brand umbrella.

For any new sub-brands, reduce risk by clearly indicating the relationship to existing, familiar brands you own (Erdem, 1998).  

Product brands take note. Risk aversion is higher for material purchases than for experiential ones such as restaurant meals or holidays (Roche et al., 2015).

42 people were either asked to make 35  'A or B' choices that would inform the design of an educational course they were attending, or instead to just read the course material. Both were then tasked with solving math puzzles and were timed until they gave up.

Those who had to make the choices beforehand persisted for less time on the puzzles and also got fewer right.

Protect your decision capacity.

Prioritize your day around and take breaks before making harder decisions. For example, restaurant inspectors can reduce errors by scrutinizing sites at higher risk of failure at the start of the day (Ibanez & Toffel, 2017).

Create product contrast.

‍When no option in a set offers a distinct advantage from the others, we're most at risk of not choosing at all (Dhar, 1997). How can you improve your choice architecture to offer variety that actually makes deciding easier? 

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Order matters for revenue.

‍Prospective Audi owners given a high number of customization options early on more readily accepted, higher-priced defaults in later steps (Levav, 2010). Though be careful not to trigger Reactance by pre-selecting defaults that are seen as too expensive.

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67 people were asked if they prefer Coke, Pepsi or have no preference, split into taster groups and given 3 rounds of both in either unlabeled or labeled cups.

Taste preferences were split evenly when the drinks were unlabeled, but when labeled, they exhibited a strong taste preference for Coke, underlining the bias of brand attachment in consumer choice.

Test your assumptions. Decision-Makers often start new projects under judgements that are both unproven and erroneous. Bring key Decision-Makers together to list assumptions honestly. Use these as a basis for testing the validity of the idea in its simplest form. This avoids unnecessary costs further down the line. See the Lean Startup Model for further details.

Consider conflicting alternatives to strengthen your strategic decision-making process. Seek impartial feedback from trusted others who are less emotionally invested in the chosen route than you.

Repeatedly point out what you do well, especially with attention to small details around customer care or craftsmanship in process. Consumers will begin to notice and start to look for further evidence to support these newly-held beliefs.

108 people were told they were the head of an airline that was either 90% complete on a $10m plane project, or shown an equivalent $1m proposal to research and develop this plane. In both cases, a competitor had created a similar plane of superior quality.

In either case, should they still invest the $1m? Those in the 90% sunk cost condition were far more likely to keep on spending than those who had yet to invest anything.

Remind consumers of past personal efforts or the amount of time spent with the brand to increase feelings of a sunk cost. Reframing past efforts as incomplete or as ongoing progress will also induce the effect and assist sales. 

Test your product ideas sooner using a more agile product methodology. This will minimize time, cost and effort wasted on unproven potential failures to which you will become increasingly attached, especially if you’re personally accountable for their success.

Take 15 mins for mindfulness practice - focusing on the present moment and less on the past and future - to increase your resistance to the Sunk Cost bias. (Hafenbrack et al., 2013). Check out the Headspace app. 

36 medical students were first asked to diagnose six clinical cases (Phase 1). They were then asked to diagnose a further eight, four of which were similar to Phase 1, but were actually different (Phase 2). Their accuracy for successful diagnosis was rated out of four.

Average diagnosis scores were 17.5% lower for Phase 2 cases that were similar to those in Phase 1.

Create pre-experiences.

‍During product development sessions, prime attendees with prototypes to first tell a detailed story of an imagined future. This will increase innovative ideas by reducing both incremental thinking  (Liedtka, 2015) and inferior ideas brought about through Ownership Bias and any Sunk Costs.  

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Conduct reflective reviews.

‍After results are in from product experiments, reviewing the specific causes behind both failures and successes is critical. This will help you understand any assumptions or misdiagnosis brought about by merely relying on what comes easily to mind (Ellis and Davidi, 2005). 

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Include real customers in retrospectives.

‍Combining reflective reviews with real customer feedback will boost team performance (Schollaert, 2009) and help suppress the perils of your team's own Confirmation Bias.

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850,000 teachers' retirement plans were assessed. Each teacher's main decision was to divide their pension between two funds: one low risk (bonds) and one high risk (stocks). They could switch between the two at no cost.

Results found that despite the massive differences in rates of return between the two funds, only 20% ever switched from their initial fund allocation.

What's the status quo in your situation?

‍Build a strategy around identifying and removing the practical and emotional switching costs that are preventing change.

Make it exciting!

‍It isn't enough to just remove the barriers. Offer a Contrasting view of the net gain of the change, painting a clear, positive picture with a personalized Goal Prime showing them how their life will be better.

Make it effortless.

‍Use Foot In The Door with a Tiny Habit to help users take the first positive step.

Identify and work with a group of 'change-makers'; those with some Authority who are most ready to adopt and embrace change.

Share their positive Stories with others more averse.

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Check your Defaults.

You’re setting them everywhere, sometimes without thinking. These strongly influence the status quo. What new behavioral goal are you looking to foster in your users? Update your defaults to suit.

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247 people were told of an NFL player endorsing a shoe brand and shown a news item of the player being guilty of a drug deal, of the brand faking employee insurance, or a no-news control. They were then asked to rate feelings towards both celebrity and product.

Products were found to suffer from worse perception after a bad celebrity act, but the celebrity was relatively untainted following a company failure.

The Devil is everywhere...

...and not particular to just humans, but also found within places, opinions, brands or symbols. In being Fast and Slow Thinkers, we look for shortcuts as to how the world is, and who to trust.

Be careful of your associations.

‍Think carefully about the connections you make and the potential risk of doing so. Consider the campaign by watch maker Swatch, themed around the Brexit referendum to design your own watch. Nobody wants to be reminded of painful division, especially when reduced to a quick sales opportunity.

Don't let the Devil get in your way.

‍We’re biased against a great idea from someone we don't like or a delicious recipe recommendation from someone with differing political views. If you discredit x just because of y, try to recognize the source of the devil and accept that we can hold many conflicting views and also be of great value to one other.

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84 people were shown an ad for a known clothing brand that they either had an existing loyalty to or not, written either assertively or not. Based upon the ad, they were then asked how much from a $25 gift card they'd spend.

People spent less money after viewing an assertive ad next to a non-assertive ad, especially when loyal.

Don’t misuse behavioural principles.

‍We've seen a rising use of faux-scarcity to create an uneasy sense of urgency as well as an aggressive use of Defaults that aren't in customers' best interests. Such applications turn positive activities, like booking a holiday into ones riddled with stress.

Give some control (Miller et al., 2007).

Having a feeling of choice can reduce feelings that our freedoms are being taken away. Mix Autonomy with Certainty by reminding of the inevitability ahead while granting other areas where you can give back control in meaningful ways.

Give lots of warning up-front

‍If you're planning a big change that will clearly trigger reactance (Richards and Banas, 2015), giving time for the news to sink in, let people familiarise themselves with the new, uncomfortable normal will then reduce reactance when the change does come about.