Scholarly Insights: AMA’s digest of the latest findings from marketing’s top researchers
Gifts can insult as much as they can flatter and corporate appreciation gifts to customers are no exception. But unlike a gift from a friend, customers have no obligation to feign gratitude. According to new research from the Journal of Marketing, customers may feel trivialized by a corporate gesture of appreciation if it consists of an insignificant monetary value. Managers can avoid devaluing the customer-company relationship by identifying customer expectations pertaining to loyalty gratitude. Here are some tried and true ways to thank your customers without diminishing them:
1. Verbal Appreciation
While participants of the study claimed that financial appreciation made them feel more valued as a customer, verbal appreciation still trumped receiving too small an amount of financial appreciation. “In other words, something is not always better than nothing at all,” remark authors Peggy J. Liu, Cait Lamberton and Kelly L. Haws.
2. Contextualized Rewards
Managers can also lower customer expectations by giving the customer a reference point. For example, a gifted coupon may indicate that others received 1%-4% discounts while that particular recipient is given 5% off. Providing a range and then giving the customer the upper part of it may effectively lower expectations for greater appreciation.
While this is not necessarily a tactic to show gratitude, research shows that gifting small percentages of a customer’s purchase to charities reverses the potential of a trivialized gift. Additionally, research shows that brands fare better when they are associated with a prosocial cause. In other words, even if appreciative gestures aren’t boosting company-customer relationships, you may be benefiting customer perceptions of your brand. That being said, if all you can afford is a small percentage, consider directing that portion to charities rather than the customer themselves.
Peggy J. Liu, Cait Lamberton, and Kelly L. Haws (2015) “Should Firms Use Small Financial Benefits to Express Appreciation to Consumers? Understanding and Avoiding Trivialization Effects.” Journal of Marketing: May 2015, Vol. 79, No. 3, pp. 74-90.