The ownership effect is a powerful cognitive bias that impacts personal life and beyond. But, we are all entitled to "let it go" a little! Join me in self-reflecting, educating, interpreting and applying this theory.
What is the one object in your house (i.e. closet, garage, etc.) that you hang onto and avoid parting with at all costs? Now ask yourself: Under what conditions do I truly need it? If not mine, how much would I be willing to pay for it? Is my life better as a result of owning this? What is the total cost of owning this? Would my life change if I sold/gave this away? *
That objective reflection should help you begin to understand that getting rid of junk could actually be a gain rather than a loss. This is one of the main principles of the ownership effect (also known as loss aversion or the endowment effect), which occurs when the possession of a particular item - regardless of sentimental value - changes how we view it.
Outcomes includes either valuing it more highly than its worth and/or overestimating the pain of letting it go.
Study after study done by psychologists have proven this point; a fact to which marketers are aware and often take advantage, allowing us to find applications of the ownership effect everywhere; to name a few: fitting rooms, sample boxes (i.e. Goodies), test driving a car, trial stays in timeshares, 30 day money-back guarantees, virtual ownerships (i.e Craigslist/Ebay), etc. Do other ownership traps come to mind that you have noticed or even fallen victim?
The best way to combat this cognitive bias is through practice. So, today I identified 13 cookbooks that didn’t pass the test in paragraph numero uno … and courtesy of the hit song from Frozen’s musical soundtrack, cue “Let It Go” because I just dropped those suckers off at Goodwill and moved on with my life. Now it’s your turn to join me (both in chorus and in action) as you identify and tackle your own ownership biases!
*Note - These exploratory questions are courtesy of a fellow blogger, in this original post.