Today I’m discussing the forthcoming paper “Consumer Reaction to Unearned Preferential Treatment” (available here) by Lan Jiang, Joandrea Hoegg, and Darren W. Dahl. The authors are interest in preferential consumer treatment programs, e.g. frequent flyer programs, complementary meals, or scratch and save promotions, etc. While research has shown these programs are effective at generating sales, the authors question whether the process by which individuals are selected to receive the awards affects how a consumer feels about receiving the award. Specifically, they investigate whether receiving earned or unearned preferential treatment affects consumer satisfaction with the treatment.
The authors run a series of experimental studies that place participants in either earned or unearned preferential treatment situations. They find that receiving unearned preferential treatment in front of others lowers consumer satisfaction. They reason that the unearned rewards promote social discomfort for the reward recipients, who seemingly feel that the equally deserving other individuals judge them. Interestingly, they find this affect is attenuated when the other party is of higher social status (while unearned, participants seemed to relish ‘sticking it’ to the perceived superior party and this offsets the social discomfort).
There are limitations to the study discussed in the paper, but this is largely the case with all experimental designs and I see no reason to discredit the broad implication: if you employ an unearned preferential treatment strategy, doing so in private is probably the best course of action. I personally have seen presentations from mobile app reward service startups which I hope take note of this finding.