Tuesday, January 6, 2009

Hotel Case Study: Peer Pressure's Impact on the Environment

By Marina Krakovsky in Scientific American

Most travelers staying at hotels have encountered a bathroom sign asking them to help save the environment by reusing their towels. Daily laundering makes a large hotel go through several million gallons of water a year, and detergent and energy use take a hefty toll, too. New research shows, however, that appealing to people’s green conscience is hardly the most effective way of convincing guests how best to dry off.

In experiments whose results ultimately confirmed what persuasion experts long believed, a team led by Noah Goldstein, now at the University of California, Los Angeles, created two types of professional-looking signs: one with the standard environmental message and the other telling guests that most of their fellow guests had reused towels. “It’s one of the oldest marketing tricks in the book,” says Goldstein, citing the plentiful research showing that in ambiguous situations people tend to follow the pack. Sure enough, as the investigators describe in the October Journal of Consumer Research, the social-norm message worked about 25 percent better than the standard environmental one. In a follow-up study that tested different tweaks to the social-norm message, Goldstein’s team got even more remarkable results. Telling guests that those who had stayed in this room had reused towels worked better than saying that other guests at the same hotel had done so—even though all the rooms were alike.

Savvy travelers realize that hotels save on laundry bills if guests reuse their towels, so environmental appeals could appear disingenuous. After all, a hotel could decide to give back that money to guests. One problem with such financial incentives, though, is logistical: according to the American Hotel & Lodging Association, tracking the number of towels reused per room could be difficult. But there is a bigger problem. If financial incentives are not high enough, Goldstein suspects, they could backfire.

That is the idea of “motivation crowding,” a theory predicting that monetary incentives push away the drive to do things for other reasons. “A good example is sex,” says Uri Gneezy, an economist at the University of California, San Diego, who studies the effect of incentives. When you make a sexual overture, your partner may or may not accept, but if you offer to also throw in $10, you will strike out for sure. “When you introduce money, you completely change the meaning of the interaction,” Gneezy explains. “Instead of a communal relationship, where we’re just nice to each other, now it’s an exchange relationship.” In a frequently cited study, Gneezy found that when an Israeli day care center started fining parents 10 shekels (about $3) for picking up their children late, tardy pickups actually increased because parents saw the fine as the price for being late. Similarly, Gneezy says that offering guests, say, a $1 discount for reusing towels will make them reason, “For a dollar, I might as well get fresh towels.” Of course, a sufficiently high incentive would boost towel reuse but at prohibitive cost to the hotel.

Estimates of towel reuse range from 35 to 75 percent, depending on how reuse is measured; to increase reuse, Gneezy suggests that hotels keep money out of it but signal sincerity with donations to environmental causes. Goldstein cautions, though, that there must be no strings attached to hotels’ donations. His team found that promising to donate money in exchange for towel reuse did not increase reuse. But when hotels said they had already donated, towel reuse rose by 45 percent. The norm of reciprocity, Goldstein believes, obliges many guests to be more green themselves.

There was also a story on NPR this evening about this story that mentioned a pilot study that compared your energy usage to others and listed it on your energy bill. The plan got nothing but negative feedback, however, it does work. The negative feedback came from those who were doing worse than the average by the way. There is also the effect of those doing better than the average relaxing their standards, however, if you think about it, the people using more than the average are more likely to use less which will lower the average, resulting in a net reduction, I think.

If you have been reading my home energy consumption updates, from time to time I mention a comparison between my home energy usage and the national average. I have been using around 73% of the average of homes. The difference is I use primarily electric heat, have electric stove, water heater, and dryer. Were I to be using gas for those things, I'd be using far far less electricity. Soon, I plan to incorporate water usage into my calculations, though I already know I use far less than average, I like solid numbers.

I'm not mentioning these things to brag, I'm just trying to be an example and trying to show people that it can be done and how to do it.


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