The Sunk Cost Fallacy is Killing Your Marketing Results (+ How to Avoid it)

by | Jul 10, 2023 | Marketing | 0 comments

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Have you ever gambled?

or traded in the stock market?

(No, I’m not going to ask you to invest in my Ponzi scheme)

I have. Both.

Both of these require an immense level of mental strength.

When you’re winning. Especially when you’re losing.

Because when you start losing… your emotions start taking over.

They cloud your judgment.

You start pouring in more money. Hoping you’d recover what you have lost. You hope… Maybe it’ll work out.

And you keep losing more money.

Until you have nothing left to lose.

All or nothing GIF

This is something that happens in marketing as well. (And should be avoided)

The reason?

😰 The sunk cost fallacy

The sunk cost fallacy is a cognitive bias.


Individuals or companies continue to invest in a project, decision, or course of action based on the resources (such as time, money, emotion, or effort) they have already put into it.

They keep doing this despite evidence that it isn’t working. And it is unlikely to be successful or beneficial in the future.

All because of the emotional attachment to the sunk cost.

And when it comes to marketing?

This can lead to not only poor decision-making, but wasted time, money, resources, and missed opportunities.

🤨 How?

Imagine that a product isn’t performing well in the market.

There’s evidence that suggests the product is unlikely to be successful.

Yet you keep investing in marketing it.


Based on the resources you already put into the product.

This leads to MORE wasted resources and missed opportunities to invest in a better product.

Another case?

You have a particular marketing strategy or tactic that is not generating the desired results.

There’s proper evidence.

Yet you keep investing in the strategy or tactic.


Based on the resources you already put into it.

This leads to missed opportunities to invest in more effective marketing strategies and ultimately, lost revenue.

I’m telling ya, emotional attachment to the sunk cost is a biatch.

Now, the real question is…

How do you avoid it?

💪🏼 Worry no more

Here are 5 tips to avoid falling for the sunk cost fallacy in your marketing.

1// Conduct A/B Testing

Test everything that you’re 100% not sure of.

Even if you’re 99% sure that something will work, test it before deploying it with full force.

If something works, keep it. If it doesn’t, ditch it.

2// Set Clear Objectives

Set clear objectives for your marketing efforts right from the start. Track their progress.

If your efforts are not meeting their objectives?

It’s time for a change.

But for that to happen, you need the objectives in place.

3// Keep an Eye on ROI

Constantly monitor the return on investment (ROI) of your marketing efforts.

If the ROI is not up to the mark?

Consider investing in different marketing channels or tactics that could yield better results.

4// Regularly Evaluate Your Marketing Strategy

Unfortunately, it’s not “create and forget”.

You should regularly evaluate the effectiveness of your marketing strategy.


Because a slight change in the consumer trend can turn things around real quick.

And you need to be aware of it to adapt accordingly.

5// Get External Help

By external, I mean an outside consultant. (Like the person writing this blog post.)

Yes, coming from a consultant, this might sound biased.

But the thing is…

We, as consultants, aren’t emotionally attached to your business or the sunk cost you have already invested into it.

If it’s not working, I’m going to tell you straight up.

So, we can save the ship before it sinks to the bottom of the ocean.

6// Be Willing to Change Course

Lastly, none of the above tips are going to matter…

Not if you’re not willing to change course.

You should not hesitate to pivot to a new strategy.

Even if it means abandoning the previous one.

Yes, this is going to require some mindset shift.

🧠 But, Keep in Mind

As Confucius said…

It does not matter how slowly you go as long as you do not stop.

Yes, you are going to face challenges, fall, and fail.

But you’re never going to win if you keep fighting with a losing strategy.

So, don’t let yourself get emotionally attached to the sunk cost.

Rise above it, and…

You’ll be unstoppable.

Found this article helpful?

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Rahul Choudhary

Rahul Choudhary

Founder, Beef Up Media

With almost 6 whole years of experience in the online marketing world, I’ve seen most – the good, the bad, and the downright ugly.

My goal?

Try to share as much of my knowledge & experience as possible.

Don’t forget to connect with me on social media. ↓

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