Staff pay a price for the good deals

All it takes is a quick glance at a few ads to see how much prices are used to influence consumers.

Shoes discounted by 53 per cent. An IT firm gives customers 30 per cent off. A car company offers free on-road costs and other major benefits.

Competing on price is a risky strategy since it generally means having to either cut expenditure or sacrifice quality to turn a profit.

But there’s another consequence that’s emerged in research published in this month’s Journal of Consumer Psychology, and that’s the dehumanisation of employees.

That might sound extreme, even though it’s common knowledge these days that bad customers can have a damaging impact on both a business’s workforce and the business itself.

Yet you might still think it absurd that the price at which you sell your goods and services can drive your customers to treat your staff as though they’re less than human.

But it’s now evidently true. The researchers began with an assumption that ‘‘a singular focus on saving money and getting the cheapest deal can lead consumers to discount the human qualities of employees and treat them more inconsiderately as a result’’.

So they conducted four independent studies, all of which proved their hypothesis.

It’s a timely analysis when you consider the proliferation of brands that often make guarantees to ‘‘never be beaten on price’’.

Those promises subsequently cultivate a transactional and clinical orientation to customer service. In other words, the opposite of what a warm interpersonal exchange should be about.

As an example, take a look at the scholars’ first study, which compared 2000 online customer reviews for two European airlines: Ryanair, known for its inexpensive market positioning, and Lufthansa, known for its premium offering.

Two-thirds of the Ryanair reviews contained dehumanising words to describe staff (such as ‘‘rude’’ and ‘‘ignorant’’) whereas more than half of the Lufthansa reviews contained humanising words (such as ‘‘friendly’’ and ‘‘helpful’’).

That was replicated in the second study, this time an experiment, which involved more than 200 people who were shown photographs of hostesses from those same airlines.

Much like the first study, the participants ‘‘attributed significantly less humanness to the woman displayed in the [Ryanair] picture’’. She was regarded as having less experience and lower levels of capability.

Now you might think those results should be expected since it’s likely people have preconceptions about brands with which they’re already familiar.

So in the third study, the researchers used a fictitious brand. And just like the first two studies, the findings were almost identical once again.

In the final experiment, 300 participants received abrupt customer service. After the unfavourable interaction, they were emailed a satisfaction survey that explicitly stated the employee would be disciplined if she received a poor rating.

Well, when that employee was from a price-conscious business, she was approximately 30 per cent more likely to receive a bad review despite providing precisely the same type of service – even though the customer knew about the likelihood of punishment.

These harsh findings don’t imply you should stop competing on price.

Instead, the scholars suggest you should just be mindful that such an approach may have a negative effect on your employees by virtue of the way customers treat them -- which is why it’s worthwhile equipping them with the tools, training and support they need to withstand the impact on their morale and wellbeing.

– Sydney Morning Herald

Researchers found that staff on a budget airline were more likely to be perceived as impersonal and underqualified than their counterparts at a highend carrier.