How Netflix Traps You (Sunk Cost Fallacy)

Three episodes into a new Netflix show, yet you are not quite liking it. The pacing is too slow, or the characters just don't resonate with you, yet you continue to watch. Why is that?

You are already 3 hours into the show, and if you stop now, it would mean that you wasted those hours for no reason. So you justify it. You said: "Maybe it improve. I'll just keep watching.

Congratulations! You've just succumbed to the sunk cost fallacy. But don't worry. You're not the only one! Netflix, along with many other companies, capitalizes on this mindset.

What Is the Sunk Cost Fallacy?

The sunk cost fallacy occurs when individuals continue to invest time, money, or effort into something simply because they have already committed resources to it, even if it no longer holds value to them.

In economic terms, a sunk cost refers to an expense that cannot be recovered, such as the hours you've already spent on that boring Netflix series. The right approach would be to make decisions on how it could affect the future, rather than dwelling on past expenditures. However, our minds resist the idea of "wasting" what we've already invested, leading us to double down instead.

How Netflix Keeps You Hooked

Netflix is a master at nudging us into this trap. Here’s how:

1. “Just One More” Mentality They design shows to end with cliffhangers. The tiny dopamine hits that make you think, “I’ve already watched this far, I can’t stop now.” For example, the show Love Island (I know it's on Peacock, but it is too good not to use for this example). They purposely end each episode with a sort of cliff hanger and a sneak peak of the next one in order to keep you wanting more.

2. Subscription Model You’ve already paid $15.49 this month, so you feel like you need to “get your money’s worth.” Even if there’s nothing you really want to watch, you keep browsing and streaming to justify the cost. Eventually, something catches your eye (or maybe you just want to stop scrolling) and you end up starting to watch.

The result? Netflix keeps you engaged longer, by pushing you into a loop of sunk costs.

Why This Matters (Beyond Netflix)

The sunk cost fallacy shows up all over our lives:

• Relationships: Staying in a friendship or relationship that isn’t healthy because “I’ve already put so much time into this.” It keeps you trapped and you have that mindset of you don’t know what you would do without it, so you keep it going.

• Jobs: Sticking with a job you hate because “I’ve been here for five years already and don't want to have to restart somewhere new.”

In all these cases, the logical move is to ask: “Will continuing give me future value?” If not, it’s time to let go.

How to Break Free From the Trap:

1. Recognize Sunk Costs: Tell yourself that past time, money, and effort are gone. They should not make you waste more time in the future!

2. Focus on Future Benefits: Ask yourself: "If I wasn't already so far into this, would I still continue?" If the answer’s no, it’s time to move on.

3. Set Limits: For Netflix, try giving a new show two episodes max to hook you. If it doesn’t, drop it without guilt.

The Bottom Line:

Netflix isn’t evil. It’s just really good at using human psychology to keep us watching. But once you understand the sunk cost fallacy, you can take control. Remember: time and money already spent are gone. What matters is how you spend the next hour.

So, is that show really that good to where you want to keep watching, or is it just the sunk cost fallacy at work?