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Monday, April 09, 2007

Envy

From the Business section of the Boston Sunday Globe comes this excerpt:

Envy is a powerful force in the human psyche -- and a tool to be exploited in marketing.

While marketers have long been aware that consumers clamor for products endorsed by celebrities or people with whom they identify, new research suggests businesses can stoke the enthusiasm of some potential customers by giving preferential treatment to others.

The promise and perils of this slight-the-customer approach are explored in a recent Journal of Marketing Research article titled "How to Attract Customers by Giving Them the Short End of the Stick."

It draws on a half dozen experiments conducted at Duke University's Fuqua School of Business, where student volunteers from the master of business administration program were presented with a range of products and scenarios. The authors conclude that, under the right circumstances, "consumers judge the same offer to be more attractive when a seller offers a better price or more benefits to another group than when the seller treats everyone equally."

The article is based on the dissertation of Alison K.C. Lo , a recent doctoral graduate of Fuqua. She cites a number of examples of how the theory has played out in the real business world.

I recognize this phenomenon but I am not comfortable with it. Groucho's comment resonates well with me.

Read the full article here.

Would you do this to your customers?

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