The Psychology Hacks Marketers Overlook

Podcast: The Marketing Millennials
Host: Daniel Murray
Guest: Phill Agnew (Host of Nudge Podcast)
Episode: 388
Date: January 30, 2026

Episode Overview

In this engaging episode, Daniel Murray sits down with Phill Agnew, behavioral science enthusiast and host of the Nudge Podcast, to dissect the often-overlooked psychology hacks that can dramatically improve marketing outcomes. Pulling from foundational studies and Phill's practical experiences, they cover why certain psychological principles work, how marketers often misapply them, and actionable insights for using these hacks in both copywriting and product experience. The discussion is practical, witty, and rich in stories, making complex behavioral science understandable and immediately useful for marketers.

Key Discussion Points & Insights

1. Loss Aversion vs. Gain Framing

• Definition & Power:
  Loss aversion is the idea that people feel the pain of losses more strongly than the pleasure of gains – roughly twice as much. Instead of highlighting what the customer will gain, marketers should highlight what the customer might lose by not taking action.

  • "Losses feel twice as painful as equivalent gains." (Phill, [03:00])

• Classic Study:
  Referenced by Phill, a study found that telling homeowners “you are losing 75 cents a day” by not insulating (loss frame) was more persuasive than “save 75 cents a day” (gain frame). ([04:45])

• Amazon Prime Example:
  When canceling Prime, Amazon tells you exactly how much you’ll lose per year in savings. This approach reportedly decreased churn by 44%.

  • "Phil, you'll probably lose £313 over the next year if you cancel." (Phill, [04:20])

• Pitfalls:
  Loss aversion can turn customers off if misapplied (e.g., punishing penalties or negative-sounding copy). Instead, frame it as the brand helping you avoid loss. ([05:17])

2. The Power and Challenge of Scarcity

• Why Scarcity Works:
  Evolutionarily, scarce resources are valued more. Scarcity taps into this survival instinct. ([07:16])

• Creative Applications:
  Traditional uses (“Only 3 left!”) are becoming less effective. Novel applications, like stating when a movie ends rather than when it begins, can drive a 36% higher likelihood of attendance ([09:05]).

  • “When he added that the movie ends this week, people were 36% more likely to actually go and watch the movie.” (Phill, [09:54])

• Ages Ending in 9:
  People hitting ages like 29, 39, or 49 are more likely to take big life actions because of scarcity awareness ([10:40]).

• Overapplying Scarcity:
  During product shortages (eggs, toilet paper), limiting purchases (e.g., “Limit 2 per person”) can backfire, causing people to buy more ([13:17]).

  • “Just putting that asterisk, it made it feel like there was some scarcity, made it feel like you might lose out.” ([12:32])

3. The Endowment Effect & Customization

• Definition:
  People value things more once they feel ownership, even partial. Build-a-Bear and Subway are cited as brands that leverage this by involving customers in product creation ([15:12]).

• Loyalty Cards Study:
  Giving customers a punch card with “2 free stamps” (making them feel they've started) led to 65% more completions than starting at 0, despite requiring the same purchases ([16:55]).

• SaaS Applications:
  Free trial setups that auto-customize with a user’s brand colors/logos increase conversions—Wave Apps, Notion as examples ([18:50]).

4. Distinctiveness vs. Positioning

• What Distinctiveness Means:
  Standing out against your competitors makes brands more memorable, not just unique in a vacuum. Memorable taglines and social proof that break category patterns work best ([20:57]).

• Heineken Example:
  “Heineken, the beer that made Milwaukee jealous” was recalled by 85% of people a week later—much higher than generic taglines ([21:26]).

• Category Contrast Study:
  Exposure to a unique brand outside a set (e.g., McDonald’s among car brands) increases memorability fourfold ([23:00]).

• Practical SaaS Story:
  Buffer replaced generic “used by big companies” social proof with real stories from small businesses with measurable success, boosting homepage conversion ([25:23]).

5. The Pratfall Effect: Showing Flaws Builds Trust

• Definition:
  People (and brands) come across as more likable if they show a small, relatable flaw—the “pratfall effect” ([28:36]).

• Quiz Participant Study:
  An otherwise smart participant spilling coffee was rated more likable than a flawless one ([28:42]).

• Marketing Applications:
  Ads and pitches that candidly confess a minor flaw (“Marmite: you either love it or hate it”, or “five reasons you shouldn’t listen to Nudge”) can increase trust and response rates up to fourfold ([31:00], [31:30]).

• Restaurant Example:
  “You trust the waiter who already said like, admitted there was something not that good on the menu, but also told you like, here are the good things.” (Daniel, [33:18])

6. Bonus: Input Bias & Labor Illusion

• Definition:
  When you show how much effort went into something, people value it more (“input bias”). ([36:08])

• Study Example:
  Presentations “taking 8 hours” to make are rated as more valuable than identical ones “taking 18 minutes” ([36:48]).

• Personal Story:
  Phill hiked 60km to a conference just to demonstrate input bias (“If people can actually see that I put a lot of effort…maybe people will value my talk more.”) ([38:18]).

Notable Quotes & Memorable Moments

• On Loss Aversion:
  “Losses feel twice as painful as equivalent gains.” — Phill ([03:00])

• On Distinctiveness and Social Proof:
  “We are used by HubSpot, we are used by Huel, we are used by Google... obviously that is absolutely pointless because everybody is used by Amazon, everybody is used by Uber... So what we decided to do instead is come up with something distinct.” — Phill ([25:23])

• On Showing Flaws:
  “There is a part of psychology that suggests that purely talking about your strengths can actually make you less likable than if you highlight a weakness.” — Phill ([28:36])

• On Effort in Marketing:
  “Sometimes writing a handwritten letter to someone you want to buy your product can be more effective than sending 100 emails using AI.” — Phill ([36:48])

• On Combining Principles:
  “You could use multiple of these principles together where there's scarcity plus loss aversion on those... there’s so many things that we talk about that you could use multiple in one or you could just use one, which is cool.” — Daniel ([28:12])

Timestamps for Important Segments

• [01:18] – Introduction to loss aversion vs. gain framing
• [04:20] – Amazon Prime's loss aversion tactic
• [06:46] – Potential pitfalls of loss aversion
• [07:16] – Scarcity’s evolutionary roots
• [09:54] – Study: Movie posters and limited showtimes
• [12:32] – Iowa soup study: Scarcity boosting sales
• [15:12] – The endowment effect and IKEA
• [16:55] – Loyalty punch card experiment
• [18:50] – SaaS onboarding & endowment
• [21:26] – Distinctiveness: Heineken tagline study
• [25:23] – Buffer’s unique social proof approach
• [28:36] – The pratfall effect defined
• [31:30] – Reddit ad: “5 reasons not to listen” outperforming conventional copy
• [33:18] – Waiter honesty as trust builder
• [36:08] – Input bias & labor illusion
• [38:18] – Phill's "input bias" hiking story

Where to Find Phill Agnew

• Podcast: Nudge Podcast (also on Apple, Spotify, YouTube)
• Reading List: Search “Nudge Podcast reading list” for Phill’s curated book recommendations (including 5 books to avoid for an extra nudge)
  • “If you search for nudgepodcast.com, you'll find me... I have 25 books in there that I recommend you read in 2025 and I have five books you should avoid as well. People love that.” ([40:16])

Key Takeaway

Behavioral psychology offers powerful, often counterintuitive levers for marketers. By understanding and applying principles such as loss aversion, scarcity, the endowment effect, distinctiveness, the pratfall effect, and input bias, marketers can cut through the noise and craft more effective, human-centered campaigns. And as Phill and Daniel underscore, thoughtfully combining these principles multiplies their effect.