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Perk Backlash: Do Surprise Upgrades Make Us Uneasy?

Whether it's a free upgrade on a hotel room or skipping ahead in the check-in line, many businesses give preferential treatment to some customers, hoping to make them more loyal. The practice often works — but a new study suggests that when we get perks we didn't earn, negative feelings can result. And they can make a surprise deal a little less sweet.

That's the gist of a study to be published later this year in the Journal of Consumer Research, with the forthright title "Consumer Reaction to Unearned Preferential Treatment."

"The current research demonstrates that, although receiving unearned preferential treatment does generate positive reactions, it is not always an entirely pleasurable experience," write the study's authors, Lan Jiang, Joandrea Hoegg, and Darren W. Dahl.

The displeasing aspects of a treat tend to peak, they write, when the perks are given in public, in front of other customers who are no different than the recipient of the business's generosity.

"We propose that receiving something that others have just as much right to receive can activate concerns about negative evaluations, reducing the satisfaction with the preferential treatment," write the researchers, who teach marketing at business schools at the University of Oregon and the University of British Columbia, Vancouver.

The study's authors found that "satisfaction with receiving preferential treatment can be restored if the observer who does not receive such treatment reacts positively to the recipient's good fortune or if the observer is of a higher status than the recipient."

That's right. The test subjects enjoyed "the positive experience of 'beating' a superior'" so much, the authors say, that it brought "increased overall satisfaction."

It also helps if nobody's looking. To test that theory, the researchers conducted experiments to test "feelings of social discomfort" and try to determine where they come from. They found that even in the most seemingly fair context — a random drawing — the winner felt best about it if they were alone.

All of the tests placed participants in situations in which one person received a surprise bonus. In one case, a booth that was dispensing free product samples suddenly gave one subject more than the others. That was welcomed — especially if no one else was around.

"It's like they wanted to get out of there," co-author JoAndrea Hoegg tells The Globe and Mail. "It's the fear of negative evaluation. If you're getting something you don't deserve, you're thrilled – as long as no one is watching you."

All of this isn't meant to imply that businesses should stop giving people free perks, the researchers say. The trick is to be sure all customers know the deal — and why they're not getting it. Other options include using scratch-off game tabs and loyalty emails, which can be kept private, to connect with customers.

Such steps, they say, "would minimize the potential for negative emotions."

Will Commerce Open The Doors To 'Eastern' Philosophy?

Let's play a game. Quickly name three philosophers of any historical era and write them down. If you are really ambitious, name five.

Take your time and think about it. It's OK. I'll wait.

Now look at your names. Were any of the men or women you wrote down born east of Afghanistan? Where any of the names of Indian, Chinese or Japanese origin? If you are like most Westerners (myself included), your list only included Westerners. Odds are your list had guys like Plato, Aristotle and Kant on it (note the rarity of women on the lists too, something Tania got into yesterday). Such geographic provincialism in the tools of our thinking raises some profound issues.

Is it really possible that the civilizations of the "other" hemisphere have nothing useful to say about value, the categories of experience or the nature of mind? If not, what does it mean that the only non-Western philosopher most people can name is the Confucius?

An excellent piece by Justin Smith in The Stone, laid out the roots of maintaining such a divide between "philosophy" and "non-Western philosophy":

Non-Western philosophy is typically represented in philosophy curricula in a merely token way. Western philosophy is always the unmarked category, the standard in relation to which non-Western philosophy provides a useful contrast.

The Mystery Of the Ridiculously Pricey Bag Of Potatoes

On Monday we told you about allegations that America's potato growers had banded together in a price-fixing Potato Cartel.

The allegations we described come from a civil lawsuit filed by the Associated Wholesale Grocers against the United Potato Growers of America, a group whose members produce the vast majority of the country's spuds. The lawsuit alleges, in part:

"As a result of these efforts, by the summer of 2008, according to the Idaho Potato Commission, a ten pound bag of potatoes cost consumers $15 — up $6 over 2007."

Mexico's Tech Startups Look To Overcome Barriers To Growth

In the past decade, Mexico's tech industry has flourished, growing three times faster than the global average. Most of that growth has been fueled by demand from the United States. But as Mexico's startups strive to make it in foreign markets, they say they need more engineers and ways to finance their growth.

Softtek, Mexico's biggest technology services company, spans four continents and provides software support to a client base that includes Fortune 500 companies. The business sector is growing rapidly in Mexico, thanks in large part to the country's proximity to the United States.

"I think it's safe to say that without the U.S., the Mexico market would not be doing very well," says Morgan Yeates, an analyst with the IT consulting firm Gartner.

A Focus On The U.S. Market

Yeates says three-quarters of Mexico's tech services are focused on the U.S. and large, global companies — such as Wal-Mart or Coca-Cola — that need help managing massive computer databases. For years, India and China have been the main providers, but that's changing.

"More and more partnerships are happening between the U.S. and Mexico," Yeates says.

U.S. companies tend to mesh better with Mexican providers. Time zones are more compatible, and Mexico is better able to serve a growing Hispanic market within the United States.

But it's not all about IT support and services. It's also about creating original software. Publish 88 is one of many tech startups popping up across Mexico. The company licenses software to print publishers seeking a multimedia presence.

“ We are driving with our hand brake on.

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