![]() ![]() ![]() Look at the conditions, figure out the costs of getting there from this point, and decide whether the game’s value outweighs those costs accordingly.īut that’s not quite how they’ll proceed. Here’s what the ticket holders should do: Which of our two ticket holders is more likely to attend? On the day of the game, there is a blizzard making travel to the stadium treacherous. The second is local and received discounted tickets. One has traveled many miles and paid a lot of money for the ticket. Two avid sports fans have tickets for a game that they are excited to attend. They’ll do this even if a better investment is sitting right in front of their face (much like my prospective client.) The harder (or more expensive) something was, the more we value that item (whether it is logical or not.)Ĭited in Thinking Fast and Slow, an example of this is: In essence, this means that someone will hold onto a bad investment just because they put a lot of time or money into it. The Sunk Cost Fallacy is an economic theory that recognizes the difficulty people have with letting go of sunk costs. We are dealing with a classic case of the Sunk Cost Fallacy. No, the objections she is raising all relate to her current website, which she had built fairly recently, at some cost and substantial time investment. It isn’t that a new site wouldn’t provide a substantial and fairly immediate return on investment (ROI). It isn’t that her business can’t afford a new site. I also know something else: she is not ready to do so. As I sit across the table from a prospective client, we can absolutely agree upon one thing: Her business would be far better off if we built a fresh website from which we could promote her business and grow. ![]()
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