WSB Research: Now You Know

Will financial incentives get people to the gym more often?

Q: Will financial incentives get people to the gym more often?

If someone is already motivated to go to the gym to improve their health, earning a financial incentive to do so is a gimme, right? Well, not so much.

Research by Justin Sydnor, the Leslie P. Schultz Professor in Risk Management and Insurance and associate professor of risk and insurance at the Wisconsin School of Business, shows that motivation and modest financial incentives aren’t enough to overcome the likely culprit keeping people from a new workout routine: overconfidence.

The researchers offered 836 new gym members varied incentives valued between $30 and $60 to visit the gym nine times in the first six weeks of their membership. As new members, they already had invested in a plan to work out regardless of an incentive.

Yet, they didn’t. Ninety-five percent of participants in the study indicated they expected to hit the gym an average of once a week; only 63% did in the first month and it dropped to 34% by the third.

The research, reported on widely by national media including the Wall Street Journal and Men’s Health, suggests that incentives won’t even help people already motivated to change. What might be more effective, Sydnor says, is helping people set realistic goals that don’t just consider time and money, but also overconfidence. That might prove be the healthiest choice of all.

Do in-store samples boost product sales?

Q: Do in-store samples boost product sales?

Shoppers who stop for that sample of ice cream or pizza aren’t just getting a free snack, they’re helping a company build long-term sales.

That’s one of the conclusions WSB Associate Professor of Marketing Qing Liu discovered about in-store sampling after she and her research partners noticed a proliferation of it. As an experiential (and sometimes tasty) method of promotion, sampling long has proved popular. But is it effective?

The research looked at samples in four product categories and included new and existing products as well as national and private-label brands. It yielded a number of findings that retailers can use to their advantage.

Besides a short-term product boost, sampling also provides a lift in sales that is sustained for two to eight weeks afterward. Also, the sampling of one brand has a positive impact on other brands within the same category. Instead of a sale that might persuade a customer to buy Product A over Product B, sampling brings customers to all the category’s brands. Sampling also provides a brand loyalty that sales or displays do not.

Further research can explore details such as optimal times or products, but in the meantime there is a simple conclusion to draw from in-store sampling: It works.

Have legal marijuana sales had an impact on home prices?

Q: Have legal marijuana sales had an impact on home prices?

As lawmakers’ discussions of recreational marijuana legislation throughout the U.S. center on health and enforcement, another piece of the debate has emerged: property values.

Research by Moussa Diop, WSB assistant professor of real estate and urban land economics, found that property values increased in the vicinity of Denver’s newly legal retail marijuana establishments since the law took effect in January 2014.

Diop and his research partners chose to study the immediate vicinity of retailers in Denver, where the new law only applied to establishments that had been medical marijuana dispensaries. They compared data from the year before the law took effect and the year after. They found that single-family residences within a tenth of a mile of retail establishments increased in value by 8.4%, or an average of $27,000 per house.

Diop and his researchers didn’t propose explanations, but offered insights into what neighbors might think about such businesses being nearby. Residents could vote with their feet and leave, driving down house prices. They haven’t done so, providing a quiet way to measure reaction to the law.

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Bruce Ellig (’BBA 59, MBA ’60)

established the Bruce R. Ellig Scholarship Fund for outstanding undergraduate students. He previously funded the Bruce R. Ellig Distinguished Chair in Pay and Organizational Effectiveness. More Class Notes »

Liz (Miller) Dawes (BBA ’85)

and her husband founded a foundation in both the U.S. and Australia in 2013 after their 18-year-old son Connor lost his life to brain cancer. In just over four years... Continue Reading »

Carrianne Basler (BBA ’91)

was recognized at the WSB Department of Accounting & Information Systems’s 49th annual awards banquet in October 2017 as a distinguished alumna. Basler is a managing director with... Continue Reading »