Temporary Sharing Prompts Unrestrained Disclosures That Leave Lasting Negative Impressions

Reto  Hofstetter; Roland  Rüppell; Leslie  John

Article | Proceedings of the National Academy of Sciences | November 7, 2017

Temporary Sharing Prompts Unrestrained Disclosures That Leave Lasting Negative Impressions

by Reto Hofstetter, Roland Rüppell and Leslie John

Abstract

With the advent of social media, the impressions people make on others are based increasingly on their digital disclosures. Yet digital disclosures can come back to haunt, making it challenging for people to manage the impressions they make. In field and online experiments in which participants take, share, and evaluate “selfies” (self-photos), we show that paradoxically, these challenges can be exacerbated by temporary sharing media—technologies that prevent content from being stored permanently. Relative to permanent sharing, temporary sharing affects both whether and what people reveal. Specifically, temporary sharing increases compliance with the request to take a selfie (study 1) and induces greater disclosure risks (i.e., people exhibit greater disinhibition in their selfies, studies 1 & 2). This increased disclosure is driven by reduced privacy concerns (study 2). Yet observers’ impressions of sharers are insensitive to permanence (i.e., whether the selfie was shared temporarily versus permanently), and are instead driven by the disinhibition exhibited in the selfie (studies 4 - 7). As a result, induced by the promise of temporary sharing, sharers of uninhibited selfies come across as having worse judgment relative to those who share relatively discreet selfies (studies 1, 2, & 4-7)—an attributional pattern that is unanticipated by sharers (study 3), persistent days after the selfie has disappeared (study 5), robust to personal experience with temporary sharing (studies 6A & 6B), and holds even among friends (studies 7A & 7B). Temporary sharing may bring back forgetting, but not without introducing new (self-presentational) challenges.

Keywords: disclosure; privacy; Self-presentation; impression formation; social media; Behavior; Perspective; Online Technology;

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Hofstetter, Reto, Roland Rüppell, and Leslie John. "Temporary Sharing Prompts Unrestrained Disclosures That Leave Lasting Negative Impressions." Proceedings of the National Academy of Sciences 114, no. 45 (November 7, 2017).

Firms do not typically disclose information on their costs to produce a good to consumers. However, we provide evidence of when and why doing so can increase consumers’ purchase interest. Specifically, building on the psychology of disclosure and trust, we posit that cost transparency, insofar as it represents an act of sensitive disclosure, fosters trust. In turn, this heightened trust enhances consumers’ willingness to purchase from that firm. In support of this account, we present six studies, conducted in the field and in the lab. A pre-registered field experiment indicated that diners were 21.1% more likely to buy a bowl of chicken noodle soup when a sign revealing its ingredients also included the cafeteria’s costs to make it. Five subsequent online experiments replicated and extended this basic effect, providing evidence of when and why it occurs. Taken together, these studies imply that the proactive revelation of costs can improve a firm’s bottom line.

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In August 2017, Commonwealth Bank of Australia was looking for ways to differentiate itself from competing banks and was also trying to improve the financial well-being of its customers. One domain where this was particularly relevant was in its bank-issued credit card business, where customers routinely selected cards that although profitable for the bank could be a poor fit for customers’ needs—leading to low satisfaction scores, cancellations, and occasionally, financial distress. To that end, the company’s Behavioral Economics team had developed a provocative experiment dubbed “The Good and the Bad.” Rather than just presenting the strengths of its various credit card offerings, they proposed also promoting each credit card’s less-obvious drawbacks. Being transparent with customers might help them make better choices, but would those choices come at the expense of bank performance? Should a company choose to be in the sales prevention business?

Teaching Note | HBS Case Collection | September 2019 (Revised February 2020)

Commonwealth Bank of Australia: Unbanklike Experimentation

Ryan W. Buell and Leslie K. John

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This Teaching Note explains the theory of the case and teaching plan for the case: Commonwealth Bank of Australia: Unbanklike Experimentation (619-018). In August 2017, Commonwealth Bank of Australia was looking for ways to differentiate itself from competing banks and was also trying to improve the financial well-being of its customers. One domain where this was particularly relevant was in its bank-issued credit card business, where customers routinely selected cards that although profitable for the bank could be a poor fit for customers’ needs—leading to low satisfaction scores, cancellations, and occasionally, financial distress. To that end, the company’s Behavioral Economics team had developed a provocative experiment dubbed “The Good and the Bad.” Rather than just presenting the strengths of its various credit card offerings, they proposed also promoting each credit card’s less-obvious drawbacks. Being transparent with customers might help them make better choices, but would those choices come at the expense of bank performance? Should a company choose to be in the sales prevention business?

Keywords: transparency; experimentation; Banks and Banking; Credit Cards; Customer Focus and Relationships; Competitive Strategy; Banking Industry; Australia;

Citation:

Buell, Ryan W., and Leslie K. John. "Commonwealth Bank of Australia: Unbanklike Experimentation." Harvard Business School Teaching Note 620-041, September 2019. (Revised February 2020.) View Details

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Temporary Sharing Prompts Unrestrained Disclosures That Leave Lasting Negative Impressions

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