The fascination with potential and how it drives decisions

This is a topic I'm passionate about. In fact, psychology as a whole is just extremely cool, but this facet of it to me is wild: We as humans are extremely fascinated with potential. And I mean extremely.

The American dream? Revolves around the potential of where you could ultimately land in life.

Lottery tickets? The whole scheme relies on the potential of winning.

Children? Their future potential knows no bounds. We desire to shape them to who they could possibly become.

Luxury brands? Show you the potential of what your lifestyle could be.

Whole household names and industries have been built off of not what actually is or a good chance of what will be, but what possibly could be.

There are a host of cognitive biases that cause people to value (and sometimes overvalue) potentials. The list ranges from optimism bias--an observed effect that happens where we tend to overestimate the possibility of good things happening in the future over bad--to the sunk cost fallacy--where we're so invested in something that it's harder to pull out the farther along we are. Most all of these biases rest on a base of optimism or our mind's ability to remember the optimistic aspects better. And that optimism is what carries us to do a lot of the things we do.

In a way, I'm relieved to know this is how human nature works because this clearly shows we're almost too positive. So let's pause for a moment to say: yay positivity! Maybe we're collectively on our way to solving world issues.

So how does a bias toward potentials influence decisions? I'll throw some examples at you:

• $241 billion VC dollars invested (in 2022) with something like 80% of investments that fail.

• Nearly 1/3 of gym memberships go unused (according to Finder.com).

• 1 out of 5 people stay in a relationship with their partner despite being unhappy (according to a Relate survey).

Potential, as we've just seen, can cause people to make decisions that from the outside looking in might not make much sense. So what are some lessons we can learn about the human (over)valuation of potential in the workplace?

Don't let that "shiny new object" effect get to you. Focus on growing and promoting the people who want to and deserve to. It'll likely cost more time and energy to go chasing after the potential of someone else who may or may not do the job better.

Take a step back to assess just how likely a project is to succeed, independent of the investments already made. Don't let the potential of success cloud the judgment of the actual likelihood of success.

Ensure that your leap of faith strategy is actually sound and not mostly driven by excitement. You could be saving yourself a lot of resources this way.

On the flip side, also recognize how potential factors into consumers' decisions. In fact, that's usually all consumers have to work of off, particularly if they've never interacted with you before.

Do they believe your product has the potential to be the thing that gets them closer to what they want? Or does another company or solution seem more promising?

Does the potential of you being what they need warrant them purchasing from you?

How can you better live up to the potential that customers are looking at you with?

As you walk away armed with the knowledge of how strong a force potential can be in shaping choices and behaviors, keep in mind how to best recognize it and leverage it. The potential a consumer views a product or brand with can greatly influence their buying decision. Ultimately, harnessing that power can pave the way for more tailored, engaging, and efficient marketing strategies, creating for a better consumer experience.

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