A karate school for youth and adults has just conducted a client survey after its successful second year of business. Some customers noted that costs increased significantly in the second year. Owners are puzzled because cost increases between the first and second year were intentionally quite small.


When the customers were billed for all fees at once the first year, they experienced that as one loss rather than many losses spread over the second year. Because people would rather experience one loss than many, integrating losses is a very effective strategy. The school may wish to consider returning to the billing process they used the first year.

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