Antonios (Adoni) Stamatogiannakis
Ph.D. is Assistant Professor of Marketing at IE Business School – IE University
Let’s say that you run a bank. You decide to give more credit to your good customers. Should you give it those who increase their account balance by any amount (even as small as 1 euro) per year? Or to those who just maintain their account? Which offer would they find more appealing?
Now imagine that you are running a charity and you want to increase repeated donations. Should you ask your contributors to pre-commit to making the same donation again and again? Or should you ask them to pre-commit to increasing their donation every time they donate, even if the increase is just only 1 cent? Which setup would they find more motivating?
Can such small differences (1 euro, 1 cent, etc.) have an impact on consumer behavior, consumer welfare, and business outcomes? And what impact, exactly?
Recent research (published at the Journal of Consumer Research) I conducted with professors Haiyang Yang (Johns Hopkins University) and Amitava Chattopadhyay (INSEAD) indicates that not only do those differences matter, but also that their impact is strikingly different for people from Western (European, North American) vs. Eastern (Asian) cultures.
In that paper, we argue and show that a situation is a lot more appealing and motivating for people from Western cultures when it is about “attainment” (e.g., increase a bank balance; increase a donation amount). On the contrary, the same situation is a lot more appealing and motivating for people from Eastern cultures when it is about “maintenance” (e.g., maintain a bank balance; keep constant a donation amount).
Cleary, the fact that the same offering (e.g., a bank account, or a request for donations) can be more appealing to consumers from Western cultures when it is about “attainment” –but it can be more appealing to consumers from Eastern cultures when it is about “maintenance” of a specific behavior– holds great promise for consumers, managers, and policy makers.
However, that is only part of the story. Decades of cross-cultural research have shown that all of us, to some extent, tend to have both an “Easterner” and a “Westerner” inside us. This means that at times we all care about maintaining balanced and harmonious relationships with our families and peers (interdependence, a very important characteristic for Eastern cultures), and at other times we care about improving our personal welfare and being positively distinct from others (independence, a characteristic very important for Western cultures).
Our research shows that the implications of this “dual” human nature can be numerous. To stick with the bank account example, a family bank account activates our interdependent side, but a personal savings account activates our independent side. As such, family accounts were found to be more appealing when they asked consumers to maintain the balance, but personal accounts were found to be more appealing when they asked consumers to increase it.
To move to a different domain, we also investigated actual weight management goals of about 1,600 consumers in an online goal platform. Some of these consumers had the goal to lose weight, and some others to maintain their weight. The results were striking. Consumers who held more online friendships (and thus were probably relatively interdependent), were more likely to pursue weight maintenance, compared to consumers who held fewer online friendships (and thus were probably more independent). In addition, more interdependent people had the tendency to “bet” higher amounts of money on goal success for maintenance goals, but independent people had the tendency to “bet” higher amounts of money on success for attainment goals.
Overall, this research is yet another powerful demonstration of the importance that cultural norms have for successful business practice. Most importantly, it shows that these cultural norms not only shape what is good and desirable in a society, but also whether different “frames” of the same situation would be seen as more desirable or not.
More generally, regardless of the geographical location (East vs. West) of the consumer activity, consumers may have different levels of motivation for the same behavior, depending on whether their independent or interdependent side is active at the moment. Thinking about their own individual well-being and actions makes “attainment” more appealing. Thinking about social harmony and balance, makes “maintenance” more appealing.
So, yes! 1 cent, half a kilo, a couple of extra minutes of exercising can make a difference in how motivating people will find saving, managing their weight, and working out! These small increases are generally motivating in the Western cultures (or to people who have an active “independent” self), but de-motivating to Eastern cultures (or to people who have an active “interdependent” self). Use them wisely, whether you are a manager or a consumer!