By James Atkinson, LLB and Sarah Jamieson
Persuasion Psychology - Favor Reciprocation: All humans in every society are deeply conditioned to treat any gift or favor as something that must be reciprocated in kind.
There are good evolutionary reasons for favor reciprocation. The rule allows for a division of labor and exchanges of diverse goods and services - creating mutual interdependence.
It’s a form of bonding that enables humans to organize into highly competent units.
The rule basically states that we must repay in kind what someone has given us. Throughout our childhood this is drummed into us.
For example: If someone sends a birthday card, we eventually send one back. If you don’t respond in kind it feels odd or not right!
If someone invites you to a dinner party, you return the invitation. If you didn’t, you’d feel that you OUGHT to.
If someone does us a favor, we owe them one in return. Terms such as: “I owe you one!” and “Much obliged,” are common responses to a favor.
Along with reciprocation goes a feeling of obligation. We are indebted to the person who has done us a favor until we can repay it with one of our own.
The obligation to repay is so strong that it can often last for many generations.
For example, 1,200 Australian soldiers died in 1918 liberating a small French village - Villers-Bretonneux - from the Germans. After the war, school children in Victoria Australia donated a penny each to rebuild the village school.
The villagers were so grateful they named their school Ecole Victoria and promised never to forget the Australians who had died for their village and those who had contributed to the school.
Nearly a century later, in keeping with the promise made by their great-grandparents, the children of Villers-Bretonneux started a collection and the villagers in due course donated $21,100 to rebuild the Victorian primary school in Strathewen - which was destroyed in bush fires.
The collection tins were emblazoned with the words: “N’Oublions Jamais l‘Australie” – Let Us Never Forget Australia!
In marketing online, reciprocation is a highly effective tool of influence:
- Reciprocation can be engaged by giving prospects a small gift – e.g. a free report or free sample.
- We usually reciprocate a favor without even thinking about it. This happens even with people we don’t usually like – e.g. salespeople!
- We feel indebted even when we haven’t asked for the gift. When charities send free address labels and the like, they get twice as many donations.
- A small gift can trigger a larger repayment, because the feeling of indebtedness is often unpleasant.
- Helping someone or giving an extra personalized touch also engages the reciprocation rule.
Another way to engage the reciprocity rule that does not involve giving a gift is to make a concession.
Concessions work on this simple tactic: first make a large request, and if that is refused, then make a smaller request that is presented as a concession.
This activates the feeling of obligation to reciprocate. Marketers often make concessions by “retreating” from a high price to a lower price.
For example, if you show customers the most expensive product first but they don’t want to buy, you then show your second-most expensive product - and make that appear as a concession. Of course, the lower-priced product may have been the target of the sale all along.
Also, some customers will buy the more expensive item right away, in which case you’ve made a very lucrative sale.
There is substantial evidence that showing the most expensive product first results in substantially higher profits.
A merchant may often start out with a somewhat inflated, but still believable, price, which he can then “retreat” from by offering a discount.
Offering your most expensive item first offers another advantage: it activates the contrast rule.
It is a well-established fact that if an expensive item is offered first, a lower-priced article that is seen immediately afterwards is perceived of as considerably less expensive than it would have been if offered alone.
Many online businesses adapt their product lines to take advantage of the contrast rule.
If a customer doesn’t buy the most expensive item, you can engage the reciprocation principle by making a reduction look like a concession.
In my travels I have encountered many exceptional salespeople who use this principle very well …
I have most of my suits tailored in Singapore. These tailors have tiny shops in some of the most expensive real estate on the planet. They HAVE to be good salespeople. The moment you walk into the shop, you’ll be served a cold soft drink and that “favor” makes it hard to walk out of the shop. The sales guy will chat awhile, then slowly get to business.
He’ll show you his BEST cloth first – which, after you touch and feel you’ll think: “Wow! That’s soft and beautiful!” The price of course will be HUGE – three or four times the cost of a rack suit in a department store.
Eventually, you’ll settle on the cloth you can afford. And the favors and concessions don’t stop there. He’ll get his tailor to fit you out in your hotel room – so you don’t have to walk in the heat, he’ll bring the cost down on clothes items because you are a “special client” – and so on.
And, eventually, you’ll leave Singapore not with one suit but perhaps two or three together with ties, belts, socks and a whole range of sartorial accoutrement.
And you know what – in the give and take of bargaining I come away HAPPY with my purchases. That’s because I feel I have influenced the salesperson to make concessions and give me a better deal. I feel more responsible for my choice.
Concessions on the part of a merchant usually increase customer’s satisfaction with the purchase. And that’s a great lesson to learn for your eBusiness.
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