Master Life Faster: Newsletter

Why it pays to be generous

Posted in Newsletter by Paul Lem, M.D. on May 3, 2009

Volume 2, Issue 5
HAPPY: Why it pays to be generous
WEALTHY: How to get more tips
SOCIAL: Why smalltalk is not a waste of time

“I’m a true believer in karma. You get what you give, whether it’s bad or good.”
-Sandra Bullock

Why It Pays to Be Generous

open-handAltruism is unselfish concern for the welfare of others. It’s when you help an old lady cross the street without any thought of reward.

In a study from the University of California, Riverside, researchers asked students to perform five random acts of kindness each week for 6 weeks. Altruistic acts included donating blood, writing a thank-you note, and dropping coins into a stranger’s expired parking meter. Results showed that do-gooders experienced a significant increase in happiness.

Evolution of Altruism
It feels good to do good. But why did altruism evolve in the first place? In the struggle for survival, it seems counter intuitive that cavemen would help each other out for free. After risking your life to kill a woolly mammoth, why share it with someone else?

Evolutionary biologists have proposed two theories to answer this question:

  1. Kin selection
  2. Reciprocal altruism

Kin selection means you are more altruistic towards people who are closely related to you. The reason is because you have more genes in common with your relatives than with strangers. Over evolutionary time, people who helped out their relatives were more likely to pass their genes on to the next generation (through their sons and daughters or nieces and nephews).

Reciprocal altruism is helping others with the expectation they will repay the favor in the future. You scratch my back and I’ll scratch yours. Of course, not everyone repays favors. There are always freeloaders and cheaters. But the desire to reciprocate is strongly ingrained in most people.

giftAt Cornell University, psychologist Dennis Regan found that people purchased twice as many raffle tickets from him when he gave them a free can of Coca-Cola beforehand. It didn’t matter whether the people liked him or not—receiving a small, unsolicited gift made them twice as likely to donate.

Good Karma
Can reciprocal altruism explain why you’re predisposed to help old ladies cross the street? It’s unlikely you will see the lady again, and even less likely she’ll be in a position to help you in the future. But if you are generous by nature, the chances are good that others will reciprocate even if the old lady does not. The sum of this reciprocation will probably exceed the cost to you.

Giving is Sexy
There is a third explanation of why altruism is so common. According to evolutionary biologist Geoffrey Miller, altruism is sexy because it shows potential mates that you are rich in resources. A caveman who was really skilled in hunting could afford to give away food because he knew he could always hunt more. This signaled his fitness to all of the cavewomen, and helped him attract more mates and sire more offspring. In modern times, it’s why men leave big tips at restaurants to impress a new date.

Do something nice for someone today. You’ll feel good, it’s good karma, and it’s good for your mojo.

Sheldon KM, Lyubomirsky S. (2004). Achieving sustainable new happiness: prospects, practices, and prescriptions. In A. Linley & S. Joseph. Eds. Positive psychology in practice. pp. 127–145. John Wiley & Sons.

Regan DT. (1971). Effects of a favor and liking on compliance. Journal of Experimental Social Psychology. 7: 627–39. Abstract.

Miller GF. (2000). The mating mind: how sexual choice shaped the evolution of human nature. Doubleday.

“The key to a woman’s heart is an unexpected gift at an unexpected time.”
-William Forrester (played by Sean Connery), Finding Forrester

How to Get More Tips

yesOne of my favorite books is Influence: The Psychology of Persuasion by Robert Cialdini. It is a must-read if you want others to do what you want. Now Cialdini is back with a new book entitled Yes!: 50 Scientifically Proven Ways to Be Persuasive. It explains how small actions can make the difference between yes and no.

Super Servers
For example, Cialdini reviews a number of studies on how servers can get more tips in restaurants. In a study from Monmouth University in New Jersey, servers increased their tips by 3.3 percent when they gave a candy to diners with their bill. When servers gave two candies to every diner at the table, tips rose by 14.1 percent compared with no candy. The ultimate technique was giving everyone a piece of candy, turning away from the table, and then turning back and placing a second piece of candy in front of every diner. With this series of small actions, tips rose by 23 percent.

People feel a strong desire to reciprocate, even if they’re receiving candy that costs only a few cents. And you can increase their reciprocation by making the gift unexpected and personalized.

Liking Yourself
Another study found that waitresses who repeated orders back to customers received tips that were almost 70 percent larger. Rick van Baaren, the lead researcher on the study, explains that we naturally like people who remind us of ourselves. When a waitress repeats our words back to us, we feel a sense of similarity and are more likely to be generous.

Gratuity Guru
For more scientifically-proven advice on how to get more tips, check out this guide from Michael Lynn, professor of consumer behavior and marketing at Cornell University:

It’s free, but he suggests you reciprocate by leaving him a tip.

Stronhmetz DB et al. (2002). Sweetening the till: the use of candy to increase restaurant tipping. Journal of Applied Social Psychology. 32: 300–309. Abstract.

van Baaren RB et al. (2003). Mimicry for money: behavioral consequences of imitation. Journal of Experimental Social Psychology. 39: 393–98. Abstract.

“When dealing with people, remember you are not dealing with creatures of logic, but creatures of emotion.”
-Dale Carnegie

Why Smalltalk is Not a Waste of Time

moneyHave you ever noticed that some salespeople try to get to know you better before making the sale? They’ll make smalltalk about your family, your hobbies, and your dog. They’ll also make a point of sharing some information about themselves. It’s an attempt to establish rapport—to relate to you as a person rather than as a paycheck.

The question is: does it work? Or would salespeople do better if they stuck to business?

Let’s Make a Deal
At the Kellogg School of Management, Don Moore instructed business students to role-play two managers within the same company negotiating over e-mail for the transfer of rights to a new technology. If they couldn’t come to an agreement, both parties were told that the seller would get $5 million and the buyer would get $0.

The students were split into two groups. One group received a package of instructions and the e-mail address of their counterpart. The second group received the same materials, but also received a photograph of their partner, and biographical information such as alma mater, undergraduate major, and interests or hobbies. Before the negotiations started, the second group was instructed to e-mail their partner for an initial “getting to know each other” exchange. The participants were told that the goal was to “break the ice.”

Better Business
After the negotiations, results showed that 29 percent of the first group came to an impasse and failed to agree on a deal. In contrast, only 6 percent of the personalized students came to an impasse. As well, the joint outcome was 18 percent higher for students who reached a deal after getting to know each other first.

Sharing personal information made students less likely to engage in threats and ultimatums. Threats were references to alternatives to negotiation such as: “If you can’t give me the deal I’m looking for, I can always produce this product without your help and make $5 million.” Ultimatums were offers such as “$8 million is my last offer. Take it or leave it.”

Relationship Selling
According to Scottish novelist Robert Louis Stevenson: “Everyone lives by selling something.” Boost your sales by getting to know your customers.

Moore DA et al. (1999). Long and short routes to success in electronically mediated negotiations. Organizational Behavior and Human Decision Processes. 77: 22–43. Abstract.

Copyright 2009 by Paul Lem, M.D. All Rights Reserved.
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