The €10 ticket you should not use

You buy a €10 ticket for the movies on Saturday night. Non-refundable, non-exchangeable. Saturday comes and you don't feel like going; staying home sounds better. Should you go because you already spent the €10? Does the answer change if the ticket cost €100? €1000?

It makes no difference. The money is spent either way. The only things worth weighing are in front of you: your energy, the film, the rain, the better plan. What is behind you is a sunk cost, and sunk costs are logically irrelevant to future decisions. We are simply not built to feel it that way.

Another version, perhaps more illustrative. Scenario A: someone gifts you a ticket to see your favorite band, and in the queue a stranger offers you €500 for it. You refuse. Scenario B: someone gifts you €500, and you offer it to someone in the queue for their ticket. The cost is identical in both cases: one forgone, one spent. Almost everyone feels the first ticket is still free.

Why this matters in an agency: we make decisions all day, for ourselves and for clients, and a good share of the hard ones are about whether to continue. We once put hundreds of hours into a platform partnership: training, bug fixing, partner management. We brought it an important client and lost real money on a clearly failed project. Our first instinct afterwards was to push on. We had invested so much; surely the way to recover it was forward. It feels logical. It isn't. The correct decision was to kill the partnership and stop feeding time and energy into something that could not work, and that is what we did.

The same bias explains a good part of buyer behavior during a purchase cycle, which is why we ask clients the question we ask ourselves: if you were deciding today, with zero history, would you start this? If the answer is no, the history is not an argument. It is a receipt.

First published in our internal knowledgebase in July 2024. Adapted for the blog.