At Rocketrip, we frequently hear that companies have adopted innovative ways to control their travel costs, often involving state-of-the-art technology. But we also hear that these innovations fail to achieve maximum savings because employees resist changing their behaviors as they plan and book their business travel.
For example, suppose a company has just implemented Rocketrip, with significant new rewards available to employees. The travel manager worries, “Our employees already have personal travel rewards programs. Rocketrip often delivers greater benefits than their current programs, but we expect our people to resist giving up what they already have.”
Behavioral economists explain this resistance as “status quo bias:” an emotional preference for the current state of affairs, even when that preference actually comes with costs.
Researchers in economics and psychology have identified several motivations behind status quo bias. The good news is, as travel managers understand these motivations, they can help employees appreciate the benefits associated with the new system. Afterwards, to learn more about how to influence traveler decision making, check out our Guide to Behavioral Economics for Travel Managers.
Economic researchers Tversky and Kahneman (1991) explain status quo bias in terms of what they call “loss aversion.” Their research shows that fear of losses tends to motivate far more powerfully than anticipation of wins.
This pattern appears in all sorts of choices. For instance, subscribers resist leaving their cable television provider, even when the new provider offers more channels at the same price. In another example, employees who had been with their company a long time were reluctant to switch to a newer health insurance plan with lower deductibles; they knew what they had and feared the unknown.
When it comes to business travel, employees often have been enrolled in their own programs offering frequent flyer miles, hotel stays, and train travel. Many have used their miles for vacations they couldn’t have taken otherwise. They hold strong memories of those trips and don’t want to lose future vacations.
Even more importantly, employees trust their current programs. They know the airline companies will give them the miles they’ve earned, although the numbers might change from one year to another. They know they can use their favorite hotel chain when they take a vacation.
To overcome this resistance, your strongest ally will be information. Create charts with side-by-side comparisons. Show employees exactly how they can track their rewards points. Explain who can help if they experience any problem redeeming their rewards. Even if you know the withdrawals will be trouble-free, you need to respond to their concerns as a way of reassuring them and building trust.
As more employees use your program, you’ll have another ally: social proof. Employees will share stories of the rewards they enjoyed – vacations, holiday reunions with distant family members, home remodeling. Consider posting some of these stories in your employee newsletter, as long as you keep the message low-key; if you appear to be promoting the new system too aggressively, employees will become skeptical.
Psychologists have identified the “mere exposure effect,” which states that simple exposure to people, objects, or systems will make them more likeable. It’s been long known that people hold strong preferences for what is familiar.
In a well-known experiment, psychologist Robert Zajonc showed images to groups of people. He chose images participants wouldn’t recognize, such as foreign language words and faces of strangers. Some groups saw the images for the first time, others a few times, and still others twenty-five times or more.
Zajonc then asked each group to assign “pleasantness” ratings to the images. What did the researchers find? The more groups had seen an image, the more they liked it.
Psychologists have found similar effects for a variety of stimuli, including paintings, abstract figures, colors, and flavors of food. In fact, you may have noticed this effect first-hand: if you’ve commuted daily on a bus or train, you probably found yourself feeling more of a bond with the people you saw regularly, compared to strangers who show up unexpectedly.
How can travel managers encourage familiarity? Consider rewarding employees for simply using the system. You can offer meaningful rewards when employees are first onboarded, for instance.
By the time employees are taking their twenty-fifth trips, they will be comfortable with the new program. Research suggests they will be far more likely to continue using the program. Additionally, you’ll have added a new motivator: they’ll associate using the system with getting rewards, even if the initial reward program has ended. You’ll also be building trust as some employees become eligible to redeem rewards and enjoy the benefits.
Anyone learning a new system must master a learning curve. For the most part, options requiring less effort will be vastly preferred over those requiring greater effort. However, the promise of a reward enters into the mix. That’s why you’ll see people voluntarily expend effort to run marathons and climb mountains — they’re calculating the good feelings they’ll experience as a reward.
For travel managers, the solution seems clear. First, make the system easy to use. Employees shouldn’t have to hunt around the website for a button to take them where they want to go.
Second, simplify the learning curve with a step-by-step guide built into the system. Ideally, employees should be able to sign on to the system and accomplish a few basic tasks (such as viewing upcoming flights) without any instruction—just by following the prompts.
Implementing a travel policy often requires employees to use new tools and procedures. Behavioral economics can explain why many employees resist using these tools. In particular, you can anticipate the status quo bias emerging as you introduce employees to a new program.
It’s important to understand that researchers recognize that this bias is widespread and extremely powerful. Attempting to overcome status quo bias with harsh penalties and rules will only lead to further resistance, as well as creating a hostile climate that encourages employee turnover. By understanding the triggers behind status quo bias, you can motivate employees to welcome the innovation and use the tools at their disposal to reduce travel costs.