Consumer Psychology: Loss Aversion by Cara Collins https://padlet.com/caracollins/jvz5euqz3qzhr7bo Storyboard for video Assignment 2 en-us 2022-01-11 13:58:48 UTC 2025-11-08 11:03:39 UTC hello@padlet.com Introduction: caracollins https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986076093 Loss Aversion is... first introduced by K & T in report on the Prospect theory 1979. describe transactions/consumption as either a loss or gain, varying depending on the type of individual. They suggest 'people underweight outcomes that are merely probable in comparison with outcomes that are obtained with certainty' and that value is assigned to either the gain or loss rather then the asset.


]]> 2022-01-11 14:01:01 UTC https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986076093 Theories: caracollins https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986076970
1.   Endowment effect (Based on ownership and added value)
2.  Transaction utility (based on reference point and context)
3.   Framing effect (How the question/offer if shown will effect the outcome)
]]> 2022-01-11 14:01:26 UTC https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986076970 Critical discussion: caracollins https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986077820 Important to consider that consumers are genuinely satisfied with the trade/purchase and would do so again if given the chance, not always just to avoid a possible loss. But given the level of in-depth research/studies done (List, 2004) on the concept, it bids that it is still relevant. ]]> 2022-01-11 14:01:47 UTC https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986077820 Application to marketers: caracollins https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986078943 Humans naturally try to avoid a loss, this affects our decision making processes and so if framed as a loss instead of a gain, marketers are likely to be more successful in accumulating interests and purchasing. ]]> 2022-01-11 14:02:21 UTC https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986078943 Examples in practice: caracollins https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986079589 - Tesco Clubcard prices 
- Panic Buying 
- Free trials 
- Investing in stocks, shares or starting up a business]]> 2022-01-11 14:02:39 UTC https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986079589 Implication to marketers: caracollins https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986080716
Understand the importance of framing and the different methods of framing. 
- Consumer engagement: Nectar, app/website deals
-Time frames: Sale periods discount expiry dates, only sold until, limited units 
- Purchasing options: Trade-in, club card lower prices and klarna ]]> 2022-01-11 14:03:11 UTC https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986080716 References & Sources caracollins https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986083532 2022-01-11 14:04:26 UTC https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986083532 How it can be used for social impact: caracollins https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986085829 - True value of a good? WTP/WTA?
-Important to do so in an ethical way instead of attempting to use cognitive bias as a profitable advantage. 
- Been adapted before; monetary 1979 to hedonistic 1992, could it be further adapted to help solve the problems of today, (pandemic/Climate change?) being ethical and sustainable as a business is crucial nowadays, particularly in the long term for almost all industries and corporations.]]> 2022-01-11 14:05:23 UTC https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986085829 The curve of value function: caracollins https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986331303 The reference point will differ depending on the context, environment and the individual. However, it does effect every individual (even seen in monkeys) , regardless of demographic. Loses 2.5x more powerful then gains]]> 2022-01-11 15:40:49 UTC https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1986331303 Key points: caracollins https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1988751616 - Is a psychological cognitive bias 
- Loses loom around 2.5x larger then gains
- Theories such as x,y and z can be applied
- The higher the risk 
- Marketers can use this concept, along with faming to create strategies and materials to positively impact purchasing decisions.
- Social impact can be made via....]]> 2022-01-12 17:28:49 UTC https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1988751616 History of the concept: caracollins https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1990061683 - 1979: based on monetary 
- 1992: Adapted into a more hedonistic concept ]]> 2022-01-13 10:22:50 UTC https://padlet.com/caracollins/jvz5euqz3qzhr7bo/wish/1990061683