Yesterday I reported on some research done by MIT behavioral economist Dan Ariely on how people have two different evaluation frameworks - one based on social norms and one based on market norms.

When people fall into a situation of evaluating a transaction in the market realm, they look at it from a cold and calculated perspective - “what am I getting in return for what I am giving, right now?” When they evaluate a transaction in a social framework, they look at it from an emotional and social norms based point of view - “it does not matter what I am getting in return for my help now, it just feels good to help out.” Giving people monetary incentives, no matter how small, can trigger the switch from one mental framework to another. So offering to pay your neighbor to help you out may not have the desired impact. You may be better off by giving them a gift or nothing at all.

Which leads to the issue of the value that we are getting from our customers when we give them a monetary incentive to help us out. If we are asking them for feedback on a new product and we pay them, will we get a different set of recommendations than if we only attract those users who are passionate enough to give us feedback on a voluntarily basis? If we do market research and pay people for the information they share or the time they spend with us, is that information as good as if we create an environment in which participants use their social norms to evaluate the value exchange - for example the ability to help peers by sharing lessons-learned and worst practices with them?

The research indicates that the value may be different. If you pay me to give you ten ideas I will give you ten ideas - whether I feel passionate about them or not. If I evaluate the transaction based on social norms I will make sure that the ideas I give you will really help you - they are the ones I really care about and which I believe will increase the adoption of your product.

What do you think? Do you have examples to share?