Jeanne Ngo’s Master’s Treatise

University of Southern California – August 2013

Segmenting the Loyalty Program Paradigm: Understanding Customer Motivations to Increase the Effectiveness of Loyalty Programs


Happiness Makes Success

A good Monday night share:

Atos’ Employee E-mail Ban & Reactance

Remember when I blogged about Bank of America and the psychology phenomenon of “reactance”?

Here’s another example in which reactance is likely to come into play and potentially backfire against a company.

In this recent article,, a tech firm called Atos is banning e-mail from the workplace. The new “zero email” policy is based on their theory that external communication e-mails are not productive or necessary for work. Although this may increase efficiencies, I wonder if Atos management considered potential reactance from its employees?

In this technological age, e-mail is seen as a perceived right, and taking that away is likely to cause reactance, which can create emotional backlash that could potentially lower productivity.

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Hot Chocolate on a Rainy Day

“The ‘Proust effect’: by eating or drinking a particular product, we unconsciously raise a vivid memory of past situations of happiness that help to improve our mood today (even after many years, since olfactory memory is very powerful).”

I can tell you my ‘proust effect’ food:

Hot Chocolate on a Rainy Day.

It brings back that sense of nostalgia and comfort at the first sip.

What’s your ‘proust effect’ food?


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Framing and Yellow Tail Wines

Yellow Tail Wines. One of the most successful and innovative wines of its time.

Why? Because it’s sweeter than most wines of its genre… to appeal to a growing younger class of wine consumers.
Why else? Because it’s relatively inexpensive… also to appeal to the growing younger class of wine consumers.

So  have you ever wondered why you see these wines at grocery stores but not often at restaurants?

I bet you haven’t; but I have!

The answer is in how humans view all things relatively. At the grocery store, Yellow Tail is compared to much more expensive wines, which makes it appear as if it is a much better deal than others in its genre. However, even at the same price, at restaurants that cater towards younger audiences, the wine would appear much more expensive  compared to the other cheap wines that are offered. This is known in the psychology world as a term called “framing,” which describes how the context of a consumer product has an effect on how the consumer views it. This also describes how important context and product placement is in marketing since consumers view all products relative to one another.

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Scarcity & Really Freaky Things: Cabbage Patch Kids

Have you ever heard of Babyland General Hospital (

If not, I’ll give you the quick run-down.

  • Cleveland, Georgia
  • It’s a real hospital; Babyland is a 70,000 square foot place where Cabbage Patch Kids are “born.”  
  •  It is positioned as a real hospital, with real doctors, real nurses, real “cabbage patch babies,” and real incubators.
  • Doctors inject “Imagicillin” into a cabbage, announce the sex, pull out a nude Cabbage Patch Doll, and place Xavier Rudd’s “birthmark” onto the cabbage patch doll.
  • A series of other post-birth rituals are then conducted to make sure these dolls are assimilated into the real world in a healthy manner.Babyland

 Well, this week a series of “Celebrity Cabbage Patch Kids,” consisting of Steven Tyler, Al Roker, Katherine Heigl, Kristin Chenoweth and Raven-Symoné, were born and are being auctioned off for charity. Similar to the near riot that these freakish dolls caused in 1984, the auction is predicting skyrocketing bids.

Here’s the primary reason why these Cabbage Patch Kids are were such a frenzy– scarcity. This term, coined by social psychologist Robert Cialdini, basically states that when people think something is in demand, or in short supply, their opinion of its value goes up. Cabbage Patch Dolls have defied the scarcity effect, by only releasing certain types of their dolls in limited editions; realistically, these things have no intrinsic value other than being rare. They are not cute, or comforting, or attractive in any way. In fact, I would argue they are the near opposite.

So the next time you catch yourself wanting to buy something, because it is a “limited edition,” think again. Do you really want to fall for the manufacturer’s freakish doll?

And if you really do, you can go here to bid on the “Celebrity Cabbage Patch Dolls”:

 Cabbage Patch Auction


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Why I Love In-N-Out


One of the West’s all-time favorite fast food places. One of the places I’ll eat at that is clearly fast food that I don’t consider fast food.

There is one main reason why I love In-N-Out (aside from their amazingly good french fries): It makes me think less.

You see, In-N-Out has traditionally had very few options on their menu. They have three combo meals; that’s it. 

That, my friends, is genious. That subjects me to status quo bias, which states that if I have to avoid making decisions, I will. That allows me to pick just one option from three, which means less cognitive resources,which means less thinking.

In this crazy world, I choose simplicity. I choose In-N-Out.

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