Why Customers Will Pay You to Restrain Them

We worry about many things. Our kids' grades, our parents' health, the world at large. (Also, will all those unemployed investment bankers have enough to eat?) Add to that list one really odd thing we worry about: our own future behavior. And how we can control it.

Think about a piggy bank, which is like a security system for a world where you're the burglar. In purchasing a piggy, you're paying $10 to protect $22 in spare change from your own hands. Life is full of piggy-bank situations, where we crave restrictions on our own behavior. Might your business benefit from helping your customers handcuff themselves?

A piggy bank is an example of a "commitment device" — a way to lock yourself into an option you might otherwise dodge, like saving money, because you think it'll be good for you. One graduating Stanford business-school student used a commitment device to lock down his own career choice. As reported by Jim Collins in a Harvard Business Review article, the student wanted to start a company, but first he needed to pay down some debt. So he took a job at a big company, promising himself that he'd exit after five years and live his entrepreneurial dream. But he also worried about being seduced by the benefits-and-bagels comfort of corporate America. So he wrote a resignation letter, dated for five years into the future, and distributed signed copies to several people he trusted. His instructions: If I don't resign in five years, put this letter in the mail and do it for me.

All of us seek ways to save ourselves from our own weaknesses. Some alcoholics take Antabuse, a pill that makes you sick when you drink. Some obese people undergo gastric-bypass surgery. Some people even live in fear of their own procrastination. They're called college students. In one study, students were told they had to turn in three papers by the end of the semester and were given the option to assign earlier binding due dates for the work. Almost three-quarters of them jumped at the chance, thus saving themselves from a frantic Red Bull — and — Wikipedia bender in the last week.

Commitment devices are commonplace in business as well. Google has pledged to give its engineers 20% of their time to pursue personal projects. With that pledge, the company forecloses its ability to claim that time (at least without a lot of grief). Small businesses get in on the act too. Norm Brodsky, an entrepreneur and a writer for Inc. magazine, runs a document-storage-and-retrieval business. He committed to taking four weeks of vacation a year, forcing himself to create systems that would allow his operation to run smoothly without him. He was successful, and since then, he has announced an even tougher commitment device: Now he'll take four months of vacation per year. This would appear to commit him to becoming French.

Meanwhile, your customers are struggling, every day, to bring out their better selves. Katherine Milkman, a doctoral student at Harvard Business School, has studied the way customers wrestle with two kinds of products: "wants," which are things they crave in the moment, and "shoulds," which are the things they know are good for them. For instance, Milkman studied the Australian equivalent of Netflix and found that when customers rent a "should" film, such as Schindler's List, along with a "want" film, such as Die Hard 3, they tend to watch (and return) the want film much faster. We aspire to be the kind of people who watch Schindler's List, but two weeks later, it's still sitting on top of the DVD player, unwatched, as we rotate through the entire John McClane cycle.

Milkman has found a similar pattern in the purchases of people who buy groceries online. When people are purchasing for next-day delivery, they order many more want foods than when they're ordering for a more-distant delivery date. We are salad people in the future and Cheetos people in the moment.

People need help saving themselves from themselves, and that presents a business opportunity. What if payroll companies offered "contingent paychecks," dispersing your earnings only if you met the conditions you'd specified (e.g., taking four hours of Spanish lessons or watching Schindler's List)? Or imagine that someone set up a national Opt Out of Fat registry, and if you signed up, restaurants would deny your requests for nachos and grocery stores would refuse to scan your Oreos. Might people pay for that?

We admit these ideas are a bit far-fetched and perhaps likely to end in bloodshed. But Milkman has offered more practical suggestions, such as cleverly bundling wants and shoulds. For instance, exercising is a should, so what if your gym offered to receive your magazine subscriptions? That way, to read the new Vanity Fair (a want), you'd have to drop by the gym. Or what if Blockbuster offered you a free tub of popcorn (a want) for every documentary (a should) that you rented?

It's a compelling idea: Might the future of business lie in encouraging shoulds rather than indulging wants? Could corporations help us bring out our better selves? We hope so. But let's face it — our wants are powerful and stubborn. Cheetos will not go quietly into the night.

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Dan Heath and Chip Heath re-released their best-selling book Made to Stick, featuring new content, such as how to make strategies stick.

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2 Comments

  • Jackie Kuehl

    Those 'should' incentives would really have to be powerful to modify someone's behavior. REALLY powerful. And what constitues a 'should'? As organic and natural companies have probably found out...people don't do what they say they should do.

  • Sheena Medina

    Interesting concept. Let’s pretend that people happily and willingly obliged into this theory. My next question would be, will heated debates spark over the definition of “shoulds” vs. “wants”? Their distinctions could dissolve. Now, that would seriously, be interesting!