Social Proof and The Tip Jar

Notes on Negotiation
Written by Marty Latz, Latz Negotiation Institute

The headline, People Do Business With People They Like, on Forbes.com recently re One way we use to decide how to behave in a given situation is to observe how others are behaving. Put another way, we take the actions of those around us into account when determining our own actions. This is the Principle of Social Proof and it’s especially powerful when we are unsure of ourselves and/or when the situation is unclear or ambiguous (for more, read Robert Cialdini’s excellent book, Influence: Science and Practice).

A colleague related that he recently ate at a local fast-food restaurant and a self-service yogurt chain. In both places, a glass jar partially filled with bills and change sat prominently next to the cash register. As he stood in line, he noticed many of the customers put either some loose change or a dollar bill or two into the jar after paying for their purchase.

While it is customary to tip a waiter for good service, it’s less so when no waiter is involved. Nevertheless, because others were doing it, when it was his turn to pay, he felt the pull to conform and put a small amount in both jars. Recognizing that social proof was involved, I decided to write this blog post.

As negotiators, we should be aware of social proof and use it to our advantage when possible. For example, it’s important to know what first-offer expectations exist in your industry and to evaluate independent standards, such as market value, precedent and tradition, which rely, in part, on social proof for their power.

And be aware that those looking to supplement their income in this way will often “salt the tip jar” or “add some starter dough” at the beginning of the day to “help” their customers figure out what is expected.

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Marty Latz is the founder of Latz Negotiation Institute, a national negotiation training and consulting company, and ExpertNegotiator, a Web-based software company that helps managers and negotiators more effectively negotiate and implement best practices based on the experts’ proven research.  He is also the author of Gain the Edge! Negotiating to Get What You Want (St. Martin’s Press 2004). He can be reached at 480-951-3222 or Latz@ExpertNegotiator.com

ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN

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