Remember that pang of guilt you felt when you received a Christmas card from that friend who was left off your list? Ever received a Diwali gift from someone which caused you to rush out and buy a gift for them? If so, you have felt the effects of the psychological principle of reciprocity.
In one study, a researcher sent out more than 500 Christmas cards to individuals selected at random from a telephone directory in Chicago. Interestingly, even though the sender did not know any of these people, he received cards back from more than 20% of them. Many of these cards even had little personal letters and notes enclosed. Such is the power of reciprocity!
We are all programmed to automatically respond to favours that people do for us. This response usually takes the form of a psychological obligation to return the favour in some way. The obligation serves the important function of maintaining strong relationships among a society’s members. Reciprocity is a powerful tool that can be used properly as well as improperly to influence people.
One aspect of the effect that makes it particularly exploitable by improper influencers is the fact that it works even if the favours are uninvited. Research has shown that it creates a sense of obligation to repay even when you never asked for the gift in the first place. Someone can create an obligation by giving you something without having any expectation of getting something in return. For example, salespeople routinely hand out gifts and trinkets to potential clients. Despite claims to the contrary, such gifts do create an obligation on the part of the receiver and may play some role in their purchase decisions down the line. Some beggars have found that if they come up to your stopped car and wash your windscreen, you will be more likely to throw some money their way because you don’t want to take any obligation. This implies that reciprocity can easily be used by someone to influence you without you having much power in the interaction.
Good salespeople are trained to offer potential customers gifts and frame any concession made during negotiations as a personal favour to the customer. When someone gives you a tie for free (with no overt obligation to buy), it dramatically increases the likelihood that you will feel a psychological obligation to buy the suit you had been considering vaguely until that point. At the heart of the creation of an obligation to reciprocate is the belief that someone has done you a favour. If the salesperson had offered you a tie on the condition that you buy the suit, there would be no real “favour” and no feeling of obligation to repay the favour.
In one study performed in the US, researchers set up a booth selling cupcakes. In the control condition, people enquiring about the price were told that the cupcake cost $1 (Rs40). In another condition, researchers informed potential buyers that the cupcakes were earlier priced at $1.25 but were now selling for $1 each. In the third condition, potential customers were told that the cupcakes were priced at $1.25 but, since they were closing soon, they were willing to sell it to the person enquiring at $1. In all conditions, the final price was $1. In the control condition, 20% of the people coming to the booth bought the cupcake. Under the discounted price condition, sales went up only slightly, with 25% buying the cupcake. However, when potential customers thought they were getting the lower price as a favour (“I am willing to sell it to you for $1”), 55% bought the cupcake for $1. From a customer perspective, it is important that you protect yourself from being improperly influenced by the principle. If someone gives you a gift with the clear goal of influencing a forthcoming decision, knowledge of the underlying psychology can help you avoid falling victim to this bias towards reciprocation. Understanding the psychology of reciprocation can also be a powerful managerial tool when used ethically. The principle suggests that if you are a good manager, you should devote time to doing favours for your co-workers. Every time you find an opportunity to do someone a favour, it is worthwhile taking advantage of it. The principle suggests that the greater your network of favours, the more likely you are to find people willing to help you in time of need. Which manager wouldn’t find the ready and willing assistance of co-workers worth striving for? It is helpful to know that there is a strong scientific basis for the adage: What goes around, comes around.
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Praveen Aggarwal is an associate professor of marketing at the Labovitz School of Business and Economics at the University of Minnesota Duluth and Rajiv Vaidyanathan is a professor of marketing and director of MBA programmes at the University of Minnesota Duluth.