changingminds.org

How we change what others think, feel, believe and do

| Menu | Quick | Books | Share | Search | Settings |

Investment principle


Principles > Investment principle

Principle | How it works | So what

 

Principle

If I have invested in something, I do not want to waste that investment.

Investing in something, by the way, includes not only money, but also (and particularly) time and emotion.

How it works

When someone makes an investment in something, it is because they have predicted the future and decided that the investment of time, energy (and possibly money) is worthwhile. They have also included gaining a return on that investment into their goals.

Self and mourning

An investment brings that thing closer to me and makes it a part of my sense of Identity, particularly if I attach emotional meaning to it. It becomes a part of me, and to detach it is remove a part of my self, such that I will feel a sense of loss and will go through a mourning process. Thoughts about this are often enough to dissuade any easy disinvestment.

Public commitment

If I have made a public commitment to something then going against that commitment will show me to be lack consistency and hence appear two-faced or a poor decision-maker. Hence I will be very unhappy to have to pull out, and especially so if that public commitment was to people who I respect and whose respect and support I will need in the future.

Pulling out

Because we have invested in something, it does not mean we will never pull out of it, and the Investment Model explains how we are constantly assessing the situation to determine whether we should stay or cut our losses and leave.

Investment often represents a sunk cost that can never be recouped. To pull out can seem like making a loss. Whilst still invested, there is hope of recovery. This is sometimes called the Gambler's trap.

Past and future

If a person has already invested in the area in question, they will be more likely to sustain their commitment, due at least in part to the 'sunk cost' effect. Another part of their decision process is the investment required in the future. People want the most value for the least cost, so a minimal future investment is often desirable.

In contrast, persuaders often want significant investment to be in the future and may start from there being little prior investment. This tension between investment being located in the past or the future can be a problem, and resolving this is an important part of persuasion planning.

Benefit timescale

Related to investment is payback or benefit. A potential problem also arises if the subject is being asked to invest in the short term, with benefits to them appearing in the relatively distant future. The effect of discounting means that they will likely assign a lower value to the benefits in comparison with the shorter-term looming cost. A job of the persuader here is to improve this ratio by reducing the apparent costs and increasing the present perception of future value.

So what

Get the other person to invest time and energy. It can be small at first, but then the commitment caused by that small investment can be used to gain further investment and so on.

Make the investment complex, including their thoughts, ideas, time and money. Get them to do things, to become physically involved. In particular, get them to make public commitments and to invest in highly visible acts.

See also

The Investment Effect in Pricing, Involvement principle, Investment Model, Involvement, Consistency Theory, Representativeness Heuristic, Endowment effect

Theories about how we think about ourselves, Theories about decision-making

 

Site Menu

| Home | Top | Quick Links | Settings |

Main sections: | Disciplines | Techniques | Principles | Explanations | Theories |

Other sections: | Blog! | Quotes | Guest articles | Analysis | Books | Help |

More pages: | Contact | Caveat | About | Students | Webmasters | Awards | Guestbook | Feedback | Sitemap | Changes |

Settings: | Computer layout | Mobile layout | Small font | Medium font | Large font | Translate |

 

You can buy books here

More Kindle books:

And the big
paperback book


Look inside

 

Please help and share:

 

Quick links

Disciplines

* Argument
* Brand management
* Change Management
* Coaching
* Communication
* Counseling
* Game Design
* Human Resources
* Job-finding
* Leadership
* Marketing
* Politics
* Propaganda
* Rhetoric
* Negotiation
* Psychoanalysis
* Sales
* Sociology
* Storytelling
* Teaching
* Warfare
* Workplace design

Techniques

* Assertiveness
* Body language
* Change techniques
* Closing techniques
* Conversation
* Confidence tricks
* Conversion
* Creative techniques
* General techniques
* Happiness
* Hypnotism
* Interrogation
* Language
* Listening
* Negotiation tactics
* Objection handling
* Propaganda
* Problem-solving
* Public speaking
* Questioning
* Using repetition
* Resisting persuasion
* Self-development
* Sequential requests
* Storytelling
* Stress Management
* Tipping
* Using humor
* Willpower

Principles

* Principles

Explanations

* Behaviors
* Beliefs
* Brain stuff
* Conditioning
* Coping Mechanisms
* Critical Theory
* Culture
* Decisions
* Emotions
* Evolution
* Gender
* Games
* Groups
* Habit
* Identity
* Learning
* Meaning
* Memory
* Motivation
* Models
* Needs
* Personality
* Power
* Preferences
* Research
* Relationships
* SIFT Model
* Social Research
* Stress
* Trust
* Values

Theories

* Alphabetic list
* Theory types

And

About
Guest Articles
Blog!
Books
Changes
Contact
Guestbook
Quotes
Students
Webmasters

 

| Home | Top | Menu | Quick Links |

© Changing Works 2002-2016
Massive Content — Maximum Speed