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Here's the Surprising Reason Companies Can Get Away With Bad Service

Feb 02, 2015

If you stood on a long, slow-moving line in a coffee shop, only to be handed the wrong drink when you finally did order, you’d probably express some dissatisfaction. Maybe you’d gripe to your co-worker about the experience at lunch, post a snarky Yelp review or vent on Facebook.

But new research shows businesses have a secret weapon that can diffuse customer ire over bad service. If a company practices "corporate social responsibility" — that is, donating to good causes — customers actually feel bad if they complain.

Jeff Joireman, an associate professor of marketing at Washington State University, tested how people would respond if they had to wait a long time to order at a coffee shop, and were then handed the wrong drink. As you might expect, people were annoyed — unless they had been told beforehand that the business donated 15% of its profits to environmental causes.

"Customers anticipate feeling guilty if they were to spread negative word of mouth because they know the company is doing good works that the customer values," he explains.

Joireman says this is because the company has built up "moral capital and… a reservoir of goodwill." Customers know that complaining could hurt the cause or causes the company supports as well as its own business.

Some companies do this better than others. Joireman finds that this effect is stronger when companies donate to a range of causes rather than a single one, because it's more likely that people will identify with at least one of the causes. Donating a decent chunk of profits, like 15%, is much more effective than donating a tiny, token amount like just 2%. And the impact is even bigger if the company lets its customers pick which one they want their portion of the donation to benefit.

It's also likely that companies whose customer base contains a significant number of young adults will have better luck with this tactic, since other research has shown that millennials are more interested in corporate social responsibility overall.

And, in a roundabout way, this can even benefit consumers as well, Joireman says. If you experience bad service and get disgruntled, venting might make you feel better, but it also will probably make you stay angry longer. And the more mental energy you spend thinking about how you were wronged, the more likely you are to enter into your next transaction with that business expecting something negative.

“We call this the ‘hostile attribution bias,’” Joireman says. “The hostile attribution bias makes people more likely to see nefarious motives in ambiguous situations.”

And this attitude can be a self-fulfilling prophecy, he warns. “Research shows that the expectations we bring into a situation influence our treatment of another person, and that person will often simply confirm the expectation we had,” he says. In other words, you’ll be a little snippy to the barista, and then perceive that they’re less polite towards you. If you scowl at them, you’re more likely to get a scowl in return, thanks to an unconscious tendency people have to mirror or mimic the expressions of people with whom they interact.

“On the other hand, giving people the benefit of the doubt, and cutting them slack, can promote a more positive spiral which leads to much better outcomes,” Joireman says. “A smile can go a long way to starting the interaction off right. What we do with our bodies, in turn, also influences our mood; smiling makes us happier.”

At the end of the day, that’s something you can’t put a price on.

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