Home > Uncategorized > The Power of Quid Pro Quo

The Power of Quid Pro Quo

confuciuswide

Confucius was an influential Chinese philosopher who lived about two and a half thousand years ago. His teachings on subjects like respect, honesty, education and the importance of strong family bonds are as relevant today as they were in his day.

On one occasion, he was challenged as to whether there was ‘One word, which may serve as a rule of practice for all one’s life?’ Confucius responded, ‘Reciprocity’.

His answer captures a fundamental human truth, which is not restricted to eastern philosophy. In the New Testament, Matthew reports Jesus giving similar advice during the Sermon on the Mount – do unto others as you would have them do unto you.

Whatever you believe, thousands of years of wisdom boils down to the fact that a bit of ‘give and take’ makes the world go round.

Reciprocity and Persuasion

At Dialogue, we ‘persuade people to buy’, and reciprocity is a key principle of persuasion. After all, people are more likely to do something if there is something in it for them too. You have to meet them halfway.

Quite how reciprocity manifests itself, very much depends on the relationship between the two parties.

You’ll happily do a favour for a friend, just for the intangible sense of being a good mate and knowledge that they’ll be there for you, should you ever need them. Whereas when the relationship is less personal, you’ll expect something back much sooner for your efforts. Just today I was asked to give a restaurant some feedback in exchange for a free coffee.

Sometimes, we don’t have time to agree what we are going to do in exchange for a product or service.  That’s where money comes in handy. Everything has a price and shoppers can choose to pay it or not.

With cold hard cash having a consistent value (between merchants, if not over time) and many branded grocery products being stocked by multiple retailers, it ought to be easy for shoppers to identify where they get the best value. However, as we know, it’s rarely that simple. Prices fluctuate and aren’t available until you go in-store. Shoppers are rewarded for their patronage in other ways too, from loyalty cards to multi-buy offers. Add in the intangible value of convenience and the comparisons go from black and white to a shade of grey.

But sometimes, brands don’t just want your money. Like the place that offered me a coffee, they want you to do something else. With disposable income shrinking, it makes sense to offer shoppers another way to get access to the things they want.

It also plays on another basic human trait; valuing something more if you’ve had to work for it.

Sampling with a difference

One way brands can encourage consumers to try their products is to give them a free sample. The trouble is, when something is free, we often take it because there is no cost to us, even if we don’t particularly want it. If you put a barrier in place, however small, you can discourage those who don’t really want your product and ensure that those who do take it value it.

For example, last year Kellogg’s set up the ‘Tweet Shop‘. They wanted exposure for their new Special K Cracker Crisps. In exchange for a tweet, visitors to the store were given a free sample. They could have picked up a packet for under £1 at Boots, so the gift didn’t have a huge monetary value. But because it wasn’t simply shoved into their hands as they walked past a train station like so many samples, they valued it more.

There’s a great case study that highlights just how much what something costs frames how much we value it. A photo-editing app called GroupShot is normally priced at 99p. However, for twenty four hours, it was free to download. As you’d expect, download rates shot up. After all, the main barrier to owning the app had been removed. However, the developers noticed that over half of the people who downloaded the app for free failed to ever open it. They’d got a free sample and that’s where their relationship with the brand ended.

We don’t know whether the Tweet Shop achieved the level of exposure that Kellogg’s hoped, but those who did interact with it would have enjoyed their Cracker Crisps all the more for having to earn them.

weetabix

Another brand to innovate in their demands on shoppers is Weetabix.

They recently partnered with Boots to run the first ‘Pay with a Picture‘ campaign. In order to get their hands on a free sample, shoppers had to photograph a TV advert and then use that photo as a voucher in-store. It sounds like a lot of effort and this review suggests the experience could have been friendlier to shoppers. However, in exchange for a free product, Weetabix made people engage with them and complete one shopper journey.

Away from the ‘breakfast brand extending itself into a light snack’ category, Amex have used their Card Sync technology to integrate sales into Twitter. To participate, cardholders have to tweet a special purchase hashtag, for example ‘#BuyXbox360Bundle‘. They then receive a confirmation tweet from Amex with a discounted price. The cardholder then has to retweet that message within 15 minutes of receiving it and the item is then sent to their billing address.

This not only ensures that cardholders follow Amex on Twitter, giving them a low cost media channel, but also that their cardholders act as ambassadors, broadcasting their savings to their followers.

Identify your goals and understand your audience

Remember the restaurant that offered me a free coffee in exchange for feedback? I don’t drink coffee, so they won’t be getting a response. However, let’s imagine that they had offered me a free cup of tea while I was in there, and asked me whether I would mind spending a couple of minutes answering their questions.

Social norms would have obliged me to do so because they had already given me something, and therefore I owed them.

In reality, one reason they didn’t adopt this approach is that the offer of a free coffee wasn’t a free gift at all.

It was also a trick meant to drive me back to their establishment and buy something else to go with the coffee. It’s not a bad tactic, but in this instance, having two goals means that neither is realised.

The challenge for brands is to find something to give back to their consumers that their consumers will value. They also need to identify what they want them to do in exchange, be it act as a brand ambassador, try a new product or simply feel more affection for them.

Identifying imbalances

It’s important to understand what each party brings to the relationship. Ensuring it is fair can help strengthen the bond between them. Occasionally, one party is already unwittingly giving something away without getting anything back, which leads to a deterioration of the relationship and a lack of loyalty.

For example, every year I pay a hefty amount to London Midland and in exchange they help me get to and from work. However sometimes, trains are delayed, meaning my fellow passengers and I give up our precious time and get nothing in exchange.

Trainscancelled

Sometimes, this frustration results in the brand being badmouthed. Worse still, it can result in staff being abused. This, in turn, reduces their job satisfaction and motivation to represent the company positively, increases staff turnover and costs the company money in the long term.

But let’s imagine that those wasted minutes were converted into loyalty points that gave commuters something back – free upgrades, discounts with partner brands, etc. Then, the delays might be tolerated with better grace.

And as commuters’ time was no longer a free commodity, London Midland would come to value it more and consequently have a greater incentive to get trains to run on time.

Because as Confucius and Jesus identified all those years ago, when we appreciate each other and are fair in our actions, everyone wins.

About these ads
  1. Pedro E. Flores
    August 5, 2013 at 9:58 pm

    Stanford University was initially offered $4 million to host a CI and endow a Confucius Institute Professorship in Sinology, but Hanban requested that the professor not discuss “delicate issues”. After Stanford refused based on academic freedom grounds, Hanban accepted making an unrestricted gift, and the university plans to use the money for a professorship in classical Chinese poetry.

  1. May 16, 2013 at 9:19 am

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Follow

Get every new post delivered to your Inbox.

Join 68 other followers

%d bloggers like this: