Incentive - September 2009 - (Page 14)

COVER STORY Don’t Show Me The Money Groundbreaking new research on the effectiveness of cash versus non-cash incentives provides scientific support for much of the industry’s accumulated wisdom By Leo Jakobson in fact, prefer non-cash incentives. (To see that study of a 1993 Goodyear Tire incentive program by BI’s John Jack, visit www.incentivemag.com/Goodyear.) “One of the things that motivated this project was the understanding that folks in the incentive industry really did have this lay belief that non-cash incentives are more powerful motivators than cash incentives,” says Victoria Shaffer, Ph.D., an assistant professor in the Department of Psychology at Wichita State University, in Wichita, KS, and lead author of the current research. “But, at the same time, I was aware of a couple of informal surveys that found that people would prefer to have cash incentives. These are ‘real world’ or ‘lay’ theories. I wanted to see if these could be replicated in the lab and then if I could start to understand why those preferences were different in different situations.” In six related experiments, performed largely on college students, Shaffer was able to replicate this contradiction. In the language of psychology, explains Shaffer, who is director of Wichita State’s Decision Making Research Lab, this is a preference reversal: “When you ask a person a question in one format, they give you answer A. Then you ask the same question but word it a little differently and, all of a sudden, you get answer B.” Specifically, if you ask people how happy they would be with a luxury noncash award and with a cash award— without comparing the two—they will be happier with the luxury item. But if you allow them to compare the two, they will Incentive N 14 | ew independent, academic research to be published next year in a scholarly journal lends long-needed scientific support to the long-held experience of incentive professionals on why non-cash incentives are preferable to cash. The research, which has been accepted for publication by the Journal of Economic Psychology, published under the auspices of the International Association for Research in Economic Psychology, examines the contradiction at the core of the incentive industry: Why program participants consistently say that they prefer cash but the experience of the incentive industry—and the results of at least one study, first reported more than a decade ago in Incentive—is that people, | September 2009 | incentivemag.com http://www.incentivemag.com/Goodyear http://www.incentivemag.com

Table of Contents for the Digital Edition of Incentive - September 2009

Incentive - September 2009
Contents
Editor’s Note
Headlines
Cover Story
Auto Incentives Turning Over
Strategies
Primer
Travel News
Top Destinations
Stockholm and Copenhagen
Broadmoor and Barbecues
Potentials
Top Merchandise Picks
Top Gift Cards

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