In a recent set of annual accounts, the US retailer Best Buy reported a gain of over $40 million from customers who had failed to redeem gift cards before the expiration date. It appears that it’s not an isolated phenomenon. The Tower Group, a consumer research company, estimates that the total value of money that goes unused on gift cards by the time expiration dates are reached is close to $2 billion annually.
Learning of these huge surpluses of unused cash, some consumer groups have called for a change to the law requiring retailers to further extend the expiration dates on the gift cards they issue in an effort to give people more time to redeem them. But based on what we know from research into the persuasion process, this kind of a change, rather than improve matters, is likely to make matters much worse. We believe that an entirely different approach is needed. In fact, it is an approach that requires the deployment of just a small change that engages a central motivation to act. Deploying this costless small change may not only increase the probability that your cousin will use that $25 Amazon.com gift certificate you purchased for him last holiday, but it could also help you persuade someone not to put off until tomorrow what they really should be doing today.
We all know that there are occasions when we procrastinate. Whether it’s exercising a little more, starting that new study assignment, or mowing the lawn, many of us can display remarkable inventiveness when it comes to stalling for time. As the Spanish proverb states, “Tomorrow is always the busiest day of the week.” Typically procrastination is associated with tasks that people find less pleasant to carry out, but it turns out that oftentimes we are just as likely to put off until tomorrow activities that we actually find fun and enjoyable. Why?
One reason is that, because people are so focused on dealing with whatever is vying for their attention at a specific moment in time, they wrongly believe that once they have gotten that albatross off their back they will have more time in the future to carry out more enjoyable activities. Of course what they fail to realize is that that albatross was one of a flock, and another one will invariably take its place, meaning that they will be just as busy in the future and, as a result, simply end up not completing even enjoyable activities.
Noting that in a busy information-overloaded world people are increasingly as likely to procrastinate desirable tasks as undesirable ones, researchers Suzanne Shu and Ayelet Gneezy set up a fascinating series of experiments. In doing so they uncovered how a small change to the expiration date can have a remarkable and counter-intuitive effect on people’s likelihood to complete a task.
Before the studies got going the researchers asked people to rate the attractiveness of a gift certificate that was good for coffee and cake worth $6 at a high-quality local bakery store. They were also asked the likelihood that they would redeem it should they be given one. Unbeknownst to the participants, although the gift certificates they reviewed were equal in terms of their cash value, they were different in terms of their expiration date: One was valid for just three weeks, but the other was good for two months. There was no doubt that when people were asked to evaluate the certificates, those with the longer expiration date received much more positive feelings than those with the shorter ones.
Interestingly, it appears that this positive evaluation influenced their predictions of whether they would use the certificate too. Close to 70 percent of those who evaluated the certificate with the two-month expiration period said they would use it, compared to roughly 50 percent who evaluated the three-week expiration period certificate. Clearly people appear to like the greater flexibility that a longer expiration date offers. Recall how in the introduction to this book we offered evidence of how poorly people predict their future behaviors. Could it be that even though people prefer the gift certificate with the longer expiration date they would, in fact, be more likely to use the gift certificate with the shorter one?
That’s exactly what the researchers set out to test and what they found was astonishing. Despite participants’ predictions to the contrary, five times as many given the short-expiration date certificate visited the bakery to claim their coffee and cake than those given the long-expiration date certificates. People may have preferred the offer with a longer expiration date because it afforded them more time to redeem the offer; however, in reality, it actually caused fewer of them to do so.
As a final check to ensure that the results of the study were attributable principally to procrastination and not to other factors, the researchers completed a series of follow-up surveys. Those who did redeem the certificates reported an enjoyable and worthwhile experience. Those who didn’t conveyed their regret and were most likely to agree with statements such as “I got too busy and ran out of time” or “I kept thinking that I would do it a bit later” as opposed to other explanations such as “I forgot,” “I don’t like pastries,” or “It seemed like too much effort.”
The result of this research suggests an immediate small change that any communicator can make when seeking to persuade clients or customers to take up offers and proposals. Instead of offering a longer time frame in order for your target audience to respond, in the mistaken belief that doing so will make it more attractive, this research suggests that a much shorter time frame should be offered. For example, a software company seeking to boost new-user registrations might see improvements if their pop-up box is changed from the standard options “Register now,” “Ask again tomorrow,” and “Ask again next week” to “Register now,” “Ask again tomorrow,” and “Remind me again in 3 days (last day to register),” perhaps offering additional benefits or bonuses to encourage early registrations.
A financial adviser or investment manager, seeking to persuade potential investors to attend a webinar or presentation on the latest investment tips, may increase sign-up rates by changing the “RSVP by” date on the invitation to one that looms sooner, rather than later. This is consistent with other research showing that email invitations indicating a specific and close deadline increase click-through registration rates by 8 percentage points.
Finally, if your spouse, friend, or business partner has promised to share a fine and presumably delicious wine with you but keeps putting it off while waiting for a special enough occasion, Shu and Gneezy would point you to a scene from the hit movie Sideways for a clue for how to potentially persuade him or her:
Miles: I’ve got a couple things I’m saving. I guess the star would be a 1961 Cheval Blanc.
Maya: You’ve got a ’61 Cheval Blanc that’s just sitting there?…It might be too late already. What are you waiting for?
Miles: I don’t know. Special occasion. With the right person. It was supposed to be for my tenth wedding anniversary.
Maya: The day you open a ’61 Cheval Blanc, that’s the special occasion.