Bustr Bensn

Why loss aversion isn’t a great behavior change tool

When I talk about how I’m building some kind of health-improvement app that uses game mechanics and other behavior change theories to help people make the changes they want to make, I almost always get the inevitable feature suggestion:

“You should ask people for an embarrassing photo of themselves that you post if they don’t complete their goal.”

- or -

“You should make people pay $100 to the NRA if they don’t complete their goal.”

There’s a great Radiolab episode, Help!, on this general idea, which is called a Ulysses Pact. The idea is that at any given moment in time, there are two versions of yourself:

Your present self, who is in their right mind and is able to make long-term goals.
Your future self, who has to do all the work.

And in a Ulysses Pact, your present self is basically blackmailing your future self into behaving the way your present self wants your future self to behave. For example, by promising to post an embarrassing photo if your future self doesn’t behave, or by extracting money from your future self.

There are even services out there that help you do this kind of blackmail on yourself (yes, I’m gonna name names):

stickk.com
gympact.com
see the latest social health article for a dozen more less successful ones

When suggested these ideas, I generally say that that’s a good idea, but in the back of my head I say, “that doesn’t work.” But I never really explained my full thoughts on the matter (until now).

Why do I believe that it doesn’t work? Here’s why.

First, we all know that we hate looking stupid, or losing things. The general principle behind that reaction is called Loss Aversion. Very few things are more scary, or more motivating than the fear of losing something that we already have. Whether it be self-respect, money, or invested time, we hate writing something off as lost, gone. So much so that if you give someone a 50/50 chance of either gaining $20 or losing $10, most people will decline that opportunity. It feels worse to lost $10 than it feels good to win $20. I’ve also learned over the years that I don’t really have loss aversion in the traditional sense… maybe entrepreneurs in general have this gene turned off.

Blackmail gains its powers due to loss aversion.

IF you had already given up your embarrassing photo, or already given $100 to someone, it would be VERY motivating if they then came back to you and said “do that thing you said you would do… or ELSE!”

When people suggest that we adopt self-blackmailing strategies to help people make the changes that they want, I immediately feel myself in that moment of blackmail… it’s too late to turn back or cancel the deal, I must now do what I said I would do or else face the very grim consequences.

HOWEVER, any service that is built on this premise has one big problem.

It has to first ask you to hand over that embarrassing photo or that money.

The same loss aversion bias that makes the strategy so compelling when you’re being blackmailed will prevent you from handing over the goods in the first place.

THEREFORE, I don’t think that this strategy will ever gain mainstream appeal, or ever prove to be more than a great PR line for a product that actually works in some other way.

That’s my long explanation for a very simple and harmless suggestion that I get from a lot of people.