It’s Not Business. It Is Personal: The Rule of Reciprocity

May 1, 2009

You have probably seen or heard of the classic scene from The Godfather where they say, “It’s not personal. It’s business.” Businesses love this line because it keeps them distant and guilt-free. It lets them think of customers as nameless, faceless masses that just need to be enticed with the right offer.

In fact business has always been personal.  Our relationships with our employees, vendors and customers are personal.  The way we treat them, recognize them and show them appreciation is personal.    Only now, it’s more obvious that it’s all personal, all the time. Today, we live in a new culture.  It’s a hyper-personal, hyper-connected, hyper-transparent, conversational, always-on, highly aware, information in my pocket, find the people like me, start a revolution kind of a culture. That may not sound like business, but it is; and it is very personal.  The businesses that get this win. The businesses that don’t lose.

If you need proof, ask the executives at Motrin about baby carrying moms. Last November, Motrin offended a segment of highly connected moms, the moms took to Twitter, YouTube, and their blogs and shut the Motrin site down in less than 48 hours. It was personal, not business.

The good news is that you do not have to be perfect.  You do, however have to be personal.  In order to be personal, you need to learn to appeal to basic human emotions.

Previously I discussed how I have been greatly inspired by Dale Carnegie who was quoted in his famous book, How To Win Friends & Influence People, as saying, “You can have everything in life that you want if you will just help enough other people get what they want.”  I also discussed the principle of “liking” — the idea that people prefer to do business with people they like and, more importantly, who like them. (An Old Technique Revisited to Grow Sales Today)

Small gestures, big returns

Just as the “liking” principle plays on basic human emotions, so too does the “reciprocity” principle. That’s why it’s so powerful.  What is the Reciprocity principle?

We all know “The Golden Rule” – “do unto others as you would have them do unto you.” But most of us are not aware of the social scientific principle of “Reciprocity” underlying the rule that we can use to become more effective, productive and influential in everything we do. The rule of Reciprocity simply states that people feel obliged to give back to others who have given to them. The rule may seem simple and intuitive, but it has profound implications for business.  This is the fundamental principle that Ivan Misner has founded BNI (Business Network International) on.

“The tendency among humans is that we want to give back to those who have given to us,” says Cialdini, the Regents’ Professor of Psychology and Marketing at Arizona State University and Distinguished Professor of Marketing in the W. P. Carey School. Cialdini is the author of  Influence: Science and Practice and a renowned expert on persuasion.

“We as humans have very nasty names for people who take without giving back in return,” Cialdini explains. “We call them ‘moochers.’ We call them ‘ingrates.’ So generally speaking, we will go to great lengths to give back once we’ve received.”

Sometimes, even a small gesture — a greeting card (expressing thanks, happy birthday or any reason), a phone call, a simple favor — can go a long way to establishing a long, profitable relationship.

Take the example of the Disabled American Veterans. For years, the DAV had sent a basic form letter to potential donors, asking for their support. With that run-of-the-mill letter, the DAV had enjoyed an 18 percent response rate — not bad, really.  But the DAV hoped for better. Seizing on the principle of reciprocity, the charity made a brilliant strategic decision.  One year, instead of sending that tired form letter alone, the DAV also included in their donor package a small gift: Personalized address labels. As a result, the response rate jumped to 35 percent.

“There’s not a single human society that does not teach its children the rule of reciprocity — the idea that you must not take without then giving in return,” explains Cialdini.

The reciprocity principle is so powerful, in fact, it even swayed the opinion — and actions — of Cialdini, who as a persuasion expert should be immune to these tricks.

It all started when Cialdini, making his first stay at the luxurious Mandarin Oriental Hotel in Hong Kong, sat down at his room’s writing table. There was nothing particularly special about either the room or the desk, Cialdini remembers.

It was what he found in the desk drawer that surprised him.

“When you go to a great hotel, sometimes you’ll look in the desk drawer and you’ll see some really nice, high-quality stationary, with the hotel’s name in gold leaf across the top,” Cialdini says. “But when I was at the Mandarin Oriental, I pulled out this stationary and my name was at the top. They had given me a gift that wasn’t designed to promote the hotel. It didn’t have their name on it — it had my name on it. I’ve never stopped recommending that hotel to anyone traveling to Hong Kong.”

With a very small investment in personalized stationary, the hotel has reaped the rewards of word-of-mouth business ever since.

It was a tailored, personalized gift, Cialdini says. “That’s the key: Many companies will give their customers pens and calendars and other things with the company name on them. But you know what? That’s the wrong name. Our customers’ names, not ours, belong on what we give them.

A leap of faith?

Cialdini says the applications for reciprocity in the real world are numerous.

A businessperson entering into a new partnership, for example, would be wise to step back and take a wide-angle look at the organization he wishes to work with. Then, he should pinpoint the person or people he can help — and make sure to do so.

“When you go into a new situation, the first question you should ask is not actually the first question we were trained to ask in all of these programs we infiltrated,” Cialdini says. “We were taught to ask ourselves, ‘Who can help me here?’ But the first question you should really ask is, ‘Whom can I help here?'”

Another way to impress potential clients or establish new business relationships, he says, would be to send personalized holiday gifts. To make those gifts more memorable, however, try sending them in October.

“If what you give to somebody is meaningful, tailored and unexpected, that’s really the best you can do,” Cialdini says. “All the evidence shows you will be repaid.”

There are applications inside organizations, too. If you’re a manager and see a colleague struggling with staff shortages, try lending her one of your staffers. Doing so not only helps a friend in need (and your company) but may insure you against similar problems in the future. More likely than not, if the time comes when you’re short-staffed, your colleague will reciprocate in kind.

“Because once you’ve benefited somebody, and once you’ve helped elevate their outcomes, that person will feel honor-bound to benefit you, and help your outcomes in return,” Cialdini says.

Using reciprocity is not complicated, Cialdini says.

All it takes is a little foresight — and the willingness to help others before they help you. In the sometimes-cutthroat world of modern business, that may seem to be a leap of faith.

But Cialdini is convinced it’s one that will pay off.

“It may not happen the next day,” Cialdini says. “But you’ve basically put money in the bank.”

Bottom Line:

  • Human beings are programmed to help those who have helped them.

  • In the world of business, a small favor to a colleague in need can serve as a long-term investment. According to the principle of reciprocity, a good deed will be repaid eventually.

  • Companies can impress customers through reciprocity by offering gifts that are personalized, meaningful and unexpected, which makes them memorable.

Jeff Battiston   www.twitter.com/jbatts

Jeff is Founder and CEO of Global Capital Services, a company that provides financing to businesses and municipalities.  Jeff is also owner of www.BuildRelationshipsToday.com, a cost-effective, web-based system that allows businesses to send personalized greeting cards and gifts in minutes.

Sources: W.P. Carey School of Business, Micro Explosion Media

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2 Responses to “It’s Not Business. It Is Personal: The Rule of Reciprocity”

  1. The Closer Says:

    Hey the Godfather had decent suits so they were ahead of the business pack from the starting line:

    http://iloveclosing.com/2009/05/03/fashion-disasters-in-corporate-america/

    Cheers
    The Closer


  2. Hi, interesting post. I have been pondering this issue,so thanks for writing. I’ll definitely be subscribing to your site.


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