Prospect Theory: Every Brand Manager who wants to be recognized as a Black Belt Must Master! Band Management 75
Twelve years ago, I read Thinking, Fast and Slow by Nobel laureate Daniel Kahneman—a book that left a lasting impression on me. Recently, I had the pleasure of discussing it with my student, Shiksha Vidyasagar.
Despite her excellent reading habits and an impressive academic background, including dual MBAs in Marketing & Sales and HR, she had missed reading this remarkable work.
I shared with her Kahneman’s concepts of System -1 and System-2 thinking.
System-1 is the fast, intuitive mode and the slower, more deliberate mode of thought.
System-2 is slow, deliberate thinking
Features of System-1 Fast Thinking
- Quick, automatic, and effortless.
- It’s the part of your brain that reacts right away.
- You use it when doing things like recognizing someone’s face or applying your vehicles brakes when a cow suddenly is in your path.
- A doctor usually uses System-1 Thinking, when he writes a perception and a 125 patient are waiting
Features of System-2 Slow Thinking
- Slow, careful, and effortful.
- This is the part of your brain that kicks in when you need to concentrate or solve a problem.
- You use it System-2 during brand analytics, taking decisions on the STP of a new products or deciding its price
- A doctor uses System-2 Thinking, when he diagnosing a patient, reading an EEG and so on.
In other words,
- System 1 = Fast, easy, but can be wrong.
- System 2 = Slow, thoughtful, and more accurate.
Kahneman’s idea is that we often rely too much on System-1, even when System 2 would make a better choice. That’s human nature.
Here’s how you as a brand manager, or a medico-marketing copywriter, use System-1 and System-2 Thinking to your advantage.
Example: Shiksha has neen assigned the task of a new painkiller for acute low back pain
I ask Shiksha: How can you use System-1 Thinking?”
The Challenge
Doctors are busy, seeing 50+ patients a day. They make quick decisions.
So, Shiksha focuses on System-1 triggers:
- Short, emotional headline
“Back on Your Feet in 15 Minutes!”
- Bold visuals
A smiling man tying his shoelaces — back pain gone.
- Red and yellow colors
These catch the eye and signal urgency.
- Simple, benefit-first messaging:
“Fast relief. Strong action. Trusted molecule.”
All these hit System-1 — fast, effortless, emotional, and easy to remember.
How does Shiksha Trigger System-2 Thinking?
For doctors who want to analyze deeper before prescribing, Shiksha includes:
- QR code or flip page for clinical data
- Randomized clinical trial summary
- Comparison charts with other categories of pain killers
This engages System-2 — deliberate thinking, logic, scientific analysis.
Prospect Theory
Prospect Theory was developed by Daniel Kahneman and Amos Tversky in 1979. But since Amos Tversky had passed away, Daniel Kahneman was awarded the Nobel Prize in 2002 as Nobel Prizes are not awarded posthumously.
Prospect Theory has fascinating applications in both pharmaceutical brand management and medico-marketing copywriting, especially when it comes to how healthcare professionals and patients make decisions under uncertainty. Prospect Theory is a way of understanding how people make decisions, especially when they have to choose between taking a risk or playing it
The Heart of Prospect Theory
Humans (Doctors are first humans) don’t think logically when making decisions – they think emotionally.
They care more about “loss aversion”, avoiding losses than gaining something.
The main idea
- People ‘feel the pain of losing something’ much more strongly than the ‘happiness of gaining something’ of the same value.
For example, losing ₹100 feels worse than the joy of gaining ₹100. - People don’t always make perfectly logical decisions. Their choices depend on how the options are shown or described to them — not just on the facts.
So, if a doctor tells a patient:
- “This medicine has a 90% success rate,” the patient feels more confident.
But if the same doctor says: - “There is a 10% failure rate,” the patient feels more worried — even though both statements mean the same thing!
In short, Prospect Theory says people are emotional about loss, and they often choose based on feelings, not just numbers.
Prospect Theory & Thinking, Fast and Slow: The Relationship
Prospect Theory is very closely related to the ideas in the book “Thinking, Fast and Slow” and fits smoothly into this book.
- It shows how people often use System-1 (fast, emotional)thinking when making decisions about risk, money, and uncertainty.
- People don’t calmly calculate every option with System-2. Instead, they react emotionally to potential losses and gains, even when it leads to poor choices.
Shiksha uses Prospect Theory very effectively in medico-marketing communication — especially when crafting messages that influence doctors’ decisions. Here are two practical examples.
Example 1: Positioning a Vaccine Using “Loss Aversion”
Shiksha is preparing a promotional aid for a new adult vaccine to doctors for prevention of Shingles (Herpes Zoster). She has two options – traditional message and Prospect Theory inspired message.
Traditional Message (Gain-framed):
“This vaccine provides up to 95% protection against the disease.”
Prospect Theory-Inspired Message (Loss-framed):
“Without this vaccine, your patients may be at a 20x higher risk of hospitalization due to complications.”
Why do the Prospect Theory inspired messages work better?
Doctors are more likely to act to prevent a loss (risk to their patients) than to seek a gain (just betterprotection). By highlighting the consequences of inaction taps into the doctor’s emotional and ethical responsibility.
Example 2: Promoting a Chronic Disorder Management Drug
Shiksha’s colleague Vikas who handles the diabetes portfolio is working on a new drug for diabetes management.
Traditional Message (Gain-framed):
“Helps improve HbA1c levels over 3 months.”
Vikas uses the Prospect Theory-Inspired Message (Loss-framed):
“Delaying therapy with this drug could mean losing precious months of glycemic control — increasing your patient’s risk of long-term complications.”
Tip: Even subtle wording changes in detailing aids, visual aids or CMEs – like switching from “benefit of use” to “cost of not using” — can create stronger engagement and influence prescribing behavior. (HEOR can be leveraged to validate this).
The message highlights the cost of delay, which doctors may subconsciously weigh more heavily than the benefit of starting therapy — due to the loss aversion principle.
:Example 3 Promoting OsteoHeal
Shiksha’s colleague also leveraged the Prospect Theory to craft a medico-marketing message for OsteoHeal — a joint care product containing glucosamine and chondroitin. Glucosamine and chondroitin in OsteoHeal help cartilage retain water, which is vital for shock absorption and cushioning in joints.
Traditional Gain-Framed Message:
“OsteoHeal helps improve joint flexibility and comfort by supporting cartilage health and hydration.”
That definitely sounds good — but it appeals more to System 2 (logical thinking).
“Every day without OsteoHeal could mean further drying and thinning of joint cartilage — increasing your patient’s risk of stiffness, pain, and loss of mobility.”
Or
“When cartilage loses its water content, its ability to cushion and absorb shock drops sharply — exposing your patients to faster joint wear. OsteoHeal helps prevent that decline.”
Why it works?
- It highlights the risk of not prescribing the product.
- It triggers loss aversion: the fear of damage, progression, or irreversible loss in joint function.
- It frames glucosamine and chondroitin not just as helpful ingredients, but as protective agents against something emotionally and physically painful — mobility loss
To conclude, in today’s competitive pharmaceutical landscape, logical claims alone often fail to move the needle.
By embracing the insights of Prospect Theory, brand managers can craft medico-marketing messages that resonate on a deeper, more emotional level.
Understanding that doctors—like all humans—are more motivated by the fear of loss than the promise of gain allows marketers to frame communication in ways that compel attention and action. Whether it’s highlighting the consequences of delayed treatment, the risk of disease progression, or the emotional toll on patients and caregivers, such messages tap into powerful psychological drivers.
This is not about manipulation, but about aligning messaging with real-world human behavior.
When used responsibly, Prospect Theory becomes a valuable compass—guiding brand managers toward messaging that doesn’t just inform, but influences; that doesn’t just explain, but inspires. Ultimately, it helps build brands that doctors trust and patients benefit from.