10 Sep A Glass of Champagne – freebie or Investment?
We’re constantly told in life however that first impressions count but taking the peak end rule at face value, they don’t in fact seem to count at all when we seek to remember how good a time we had. Accordingly, we might ask if there is any benefit at all for a restaurant to giving anybody a free glass of champagne at the start of the meal, birthday or not?
The answer is of course yes. We use a glass of champagne in the examples below as it is an obvious and tangible thing that a restaurant might do, but even a smile, a warm welcome, and an extra nice table can have the same effect.
Life is better with a glass of champagne.
Think of the answer to the question ‘how happy are you with your life?’ Not how happy are you today, or this week, but rather, the totality of your life: who you are, your job, your spouse, maybe your children, everything. You would think that would be kind of fixed really, hardly changing day to day and certainly not hour to hour. You’d be wrong.
Psychologist Norbert Schwarz invited participants to his lab to answer the question of how happy they were with their lives, but before answering, he asked them each to photocopy a sheet of paper for him. Deliberately placed on the photocopier, half the participants found a dime (the experiment was done some time ago) while half did not. Guess what? Those who found a dime then reported significantly higher levels of happiness at the totality of their own life than those who did not.
If people can increase the positivity about their own entire life by simply finding a dime, something nice at the start of a restaurant experience, like a free glass of champagne, must surely alter people’s moods positively such that they will enjoy the meal more. That in fact seems like common sense. How though does this influence the memory of the restaurant according to the peak end rule? One obvious mechanism is that the peak pleasure will appear to be increased, that is, a dish that a diner might have scored (even doing this unconsciously) at say 7 out of 10 may get bumped up to an 8 simply because they are in a better mood when they score.
Everything seems better when you are happy, even average cooking.
The Halo Effect
Second, the halo effect. Here, your early action of giving a free glass of champagne creates an emotional bias in favour of the restaurant that will make other characteristics of the restaurant and meal also seem more favourable as a result. Again referring to Kahneman’s recent book (Thinking, Fast and Slow), he reports that:
The sequence in which we observe characteristics of a person is often determined by chance. Sequence matters, however, because the halo effect increases the weight of first impressions, sometimes to the point that subsequent information is mostly wasted.
By giving a guest a free glass of champagne early on, you take random chance out the sequence and seize the initiative so that you guarantee the order of observed characteristics. The early gift deliberately sets up the Halo Effect to work in favour of the restaurant and so achieved, allows a better impression of later events that the diner would have been otherwise less enthusiastic about.
Again, thinking of the peak end rule, if the last experience of the evening was a poor one, perhaps a mistake on the bill, the positively primed customer will be substantially more understanding and forgiving of the mistake. When applying the peak-end rule in remembering the meal, they might even ignore the mishap fully, whereas those not under the influence of the Halo Effect might mark the restaurant down despite an otherwise flawless meal.
The final point is a read across from the work of Robert B Cialdini, a professor of both marketing and psychology, a leading expert on the subject of influence and the author of a book of that name. Cialdini describes it simply as this:
The rule says that we should try to repay, in kind, what another person has provided for us.
Cialdini describes it as ‘one of the most potent of the weapons of influence around us’. It’s why if someone sends you a Christmas card, you feel obliged to send one back (who hasn’t said of Christmas cards: I’m only sending them to people who send me one this year). He believes it is innate across all human cultures. He goes on to say that:
By virtues of the reciprocity rule, then, we are obligated to the future repayment of favours, gifts, invitations, and the like.
Accordingly, if you ‘give’ a glass of champagne to a guest, they need to find a basis to reciprocate. If you then shortly after hand them the wine list, their obligation to repayment will often see them buy a more expensive bottle of wine than they otherwise would have, even producing a net profit for the restaurant on the exchange.
The reciprocation rule might or might not influence the peak end rule for the guest remembering their experience, but that doesn’t in fact matter for the positive mood bias and halo effect will take care of that anyway. The reciprocation rule does however mean that the cost of giving away a free glass of champagne will in fact be refunded to you by the customer, with the result being that they themselves have paid up to have (and remember having) a better time.
Everyone wins it seems: the customer is put in a better mood, experiences a better time and remembers a better time. The restaurant meanwhile has a happy customer who is more likely to return, more likely to recommend the restaurant to friends and a customer who at a minimum refunds the restaurant for the ‘generous’ gift of the champagne through reciprocation.
[box style=”yellow download rounded” ]This article was re-published from http://www.thecriticalcouple.com/13/post/2012/09/a-free-glass-of-champagne-cost-or-investment.html upon special request; my thanks go to The Critical Couple for their kind allowance for me to republish this fantastic article![/box]