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The Madison Avenue Field GuideA field guide to marketing & advertising, by Brandon Mina

GlossaryStrategy & FrameworksLoss Aversion

Strategy & Frameworks

Loss Aversion

Kahneman and Tversky's 1979 prospect-theory finding that losses feel roughly twice as powerful as equivalent gains.

By Brandon MinaCEO, BrandPilot AIUpdated November 2026

Short answer

Loss aversion is the tendency for losses to feel more powerful than equivalent gains, roughly twice as much in Kahneman and Tversky's 1979 prospect theory. In marketing, it explains why free trials, limited-time offers and framing that emphasizes what customers could lose often motivate action more than equivalent promised benefits.