Previously, I discussed Dan Ariely’s research about social and market norms.  While it seems easy enough, in theory, to offer some social reward in a business environment to increase loyalty or morale, Ariely cautions about carelessly combining social and market norms.  Bringing market norms into a social situation can lead to outcomes that are uncomfortable to even think about:  he offers the example of finishing a lovely Thanksgiving meal with your extended family and then offering to pay your mother-in-law $300 for her efforts to prepare it.

However, it can be just as unfortunate to bring social norms into a market situation.  To illustrate this, Ariely asks you to consider the bank that has spent billions of dollars marketing the impression of a social relationship.  Customers join in to be part of the bank ‘family,’ but then a check bounces.  In a solely market relationship, there is a fee and the customer moves on because “business is business.”  However, in the social relationship that the bank has marketed, the fee comes instead of a “friendly call from the manager” and is “not only a relationship-killer, it’s a stab in the back.  Consumers will take personal offense.”

“In treating their employees—much as in treating their customers—companies must understand their implied long term commitment.” Not only can it be unwise to combine these two norms in a relationship between a business and a customer, but also between a business and its employees.  Think about the business that encourages high morale with an emphasis on the family atmosphere at the workplace…but then lays off employees due to budget cuts.  Once the social norms work their way deeply into the workplace, it’s no longer “just business” and a layoff becomes a very personal, and likely bitter, experience.

“When a social norm collides with a market norm, the social norm goes away for a long time.  In other words, social relationships are not easy to reestablish. Once a social norm is trumped by a market norm, it will rarely return.” Even more dangerously, once a social norm has been violated, it takes a long time to recover.   It’s harder to forgive and forget in a situation where you feel you were personally affronted.

Both in interacting with customers and employees, businesses need to carefully consider the integration of social and market norms, which goes back to the idea that “if companies want to benefit from the advantages of social norms, they need to do a better job of cultivating those norms.” Think about the integration of social and market norms, both within your workplace and with customers.  Are you swimming in dangerous waters by not truly cultivating a social relationship, or are you managing an effective balance between the two norms?

About Kelly: Kelly has been working as a contract technical writer for Inova Solutions for nearly three years. As a recovering high school English teacher, she enjoys the opportunity to still employ her ‘red ink’ when writing, editing, and formatting documentation. You can contact Kelly at kelly@insideinova.com.