It is Not What You Get But When You Get it: The Effect of Gift Sequence on Deposit Balances and Customer Sentiment in a Commercial Bank

Abstract

The impact of gifts on deposit balances and customer sentiment was examined in a longitudinal field experiment conducted on depositors at a bank. Several factors were manipulated: gift type, the accompanying message, and the sequence of gift value, which was either increasing ($35 then $100 gift), decreasing ($100 then $35 gift), or a single gift. Gifts increased deposit balances, survey response rates, and measures of customer satisfaction, trust and loyalty compared to the no-gift control. Within gift conditions the sequence of gift value was the most important factor, with a highly detrimental effect of decreasing value on deposit balances. These results showed evidence of persistence in a long term follow-up analysis of deposit balances.