Unearned Preferential Treatment

Abstract

Although upgrading an airline seat or a hotel room may seem like a simple way to delight a customer, it can sometimes have unintended consequences. Satisfaction with an unexpected upgrade could be lessened if others did not also receive it, particularly if those others were friends of the upgraded customer. Using a between-subjects design with a scenario and survey, we found that power moderated the effect of relationship status on individuals’ satisfaction and behavioral intentions, such as repurchase and recommendation, when receiving unearned preferential treatment. Participants in the powerless condition exhibited lower satisfaction and behavioral intention when they were with friends who did not receive an upgrade, as compared with when they were with strangers. However, such a difference was not observed among participants in the powerful conditions. Managerial implications and ideas for future research are discussed.

Keywords

consumer behavior marketing

Recent studies suggest that merely satisfying customers is not sufficient (Kim and Mattila 2010). Service companies of all sorts spend a great deal of time and money in an effort to “surprise and delight” the customer in the hope that doing so will result in the highest level of customer satisfaction (Kim and Mattila 2010). For example, many service organizations make a great effort to surprise their customers in creative ways, such as with unexpected in-store coupons (Heilman, Nakamoto, and Rao 2002). In the hospitality industry, one common way to achieve this is to give the customer preferential treatment in the form of an unexpected upgrade. If space is available, a hotel front office employee may upgrade a guest from a standard room to a king room or suite for no additional charge. Likewise, when the first-class seats on an airplane are not fully booked, coach customers may get upgraded to first class unexpectedly.

Although these surprise perks may seem like a simple way to delight a customer, they can sometimes have unintended consequences. Previous researchers have found that unearned preferential treatment often leads to less customer satisfaction due to perceived unfairness and a feeling of social discomfort (Jiang, Hoegg, and Dahl 2013; Mattila, Hanks, and Zhang 2013; van den Bos et al. 1997; Xia and Monroe 2010). For example, Mattila, Hanks, and Zhang (2013) found that for some individuals, the satisfaction with an unexpected upgrade could be lessened if others did not also receive it, particularly if those others were friends or close associates of the upgraded customer. Although the customers felt pleased to get the upgrade, the inequity of the situation violated their sense of fairness, which in turn attenuated their satisfaction with the upgrade and adversely impacted behavioral intention, including repurchase and recommendation.

This outcome is of concern to airlines and hotels, as the point of the upgrade is to increase the level of customer satisfaction and thereby create loyalty. Thus, it is important to investigate factors that can mitigate this sense of unfairness and social discomfort, and further increase satisfaction and behavioral intention after an unexpected upgrade or other similar preferential treatment. In this study, we examine how a customer’s sense of power might moderate the effect of the focal customer’s relationship status with other customers on the level of satisfaction and behavioral intention toward repurchase and recommendation after preferential treatment. Prior research has demonstrated that powerful individuals tend to have an agentic view of themselves and be more self-focused (Rucker, Galinsky, and Dubois 2012). Powerless individuals, however, tend to have a more communal view and tend to be more other-focused (Rucker, Galinsky, and Dubois 2012). For powerless people, who are more communally oriented and other-focused, receiving preferential treatment while others did not should lead to a lower level of satisfaction with the upgrade when those others are close friends or associates with whom they have communal relationships. However, we would expect not to find any such effect among powerful consumers, who are more self-oriented and less concerned about the outcomes for other people. A better understanding of the ways in which a sense of power influences the customer’s reaction to preferential treatment has not only theoretical implications but also managerial implications for the airline and hotel industries.

Literature Review

Preferential Treatment

Preferential treatment has gained a vast amount of attention through practitioners and academic researchers in recent years (Henderson, Beck, and Palmatier 2011; Homburg, Droll, and Totzek 2008; Lacey, Suh, and Morgan 2007). It is often defined as “giving selective customers elevated social status recognition and/or additional or enhanced products and services above and beyond standard firm value propositions and customer service practices” (Lacey, Suh, and Morgan 2007, 242). Preferential treatment has been found to have some positive outcomes such as decreased price sensitivity, feelings of superiority (Henderson, Beck, and Palmatier 2011), stronger customer–brand relationships, more positive word-of-mouth, and increased purchase intentions (Lacey, Suh, and Morgan 2007).

Although previous research mainly focuses on preferential treatment that has been earned through effort (Dreze and Nunes 2009), such as loyalty rewards programs (Dreze and Nunes 2009), unearned preferential treatment has received little attention (Jiang, Hoegg, and Dahl 2013). Unearned preferential treatment, which is normally offered spontaneously without any implicit justification, is quite common in market place (Jiang, Hoegg, and Dahl 2013). For example, a free upgrade when checking in at a hotel front desk, getting a nicer rental car, and an unexpected dessert in a restaurant are all considered unearned preferential treatment. Unlike effort- or loyalty-based preferential treatment programs, unearned treatment often leads to less customer satisfaction due to perceived unfairness as well as increased social discomfort (Jiang, Hoegg, and Dahl 2013; Mattila, Hanks, and Zhang 2013; van den Bos et al. 1997; Xia and Monroe 2010).

One construct that has been frequently used to measure people’s reactions toward equitable and inequitable arrangements is justice (Adams 1965; Austin, McGinn, and Susmilch 1980; van den Bos et al. 2006). With respect to people’s judgments of outcome justice, individuals normally perceive an outcome that is equal to the outcome of another person as an equitable and just outcome, whereas a better or worse outcome than the comparison would be judged as inequitable and unjust outcome (van den Bos et al. 2006). Although disadvantageous inequity leads to negative affect and judgment universally, advantageous inequity induces conflicting social motives—a positive egoism-based pleasure and a fairness-based negative feeling. An intention to resolve the conflicting social motives results in feeling distressed and less satisfied about the unearned preferential treatment (van den Bos et al. 2006). In the hospitality literature, Mattila, Hanks, and Zhang (2013) examined an unearned airline upgrade and reported similar findings. As mentioned, the results of their study suggest that unearned preferential treatment negatively influences customer satisfaction and behavioral intentions, and such a relationship is mediated by perceived fairness.

Another plausible explanation for the negative effect of unearned preferential treatment is social discomfort. As much as preferential treatment induces a positive feeling due to elevated status, comparisons between the benefited and non-benefited consumers naturally occur (Jiang, Hoegg, and Dahl 2013). People always have an ongoing interest in how they are perceived by others and regularly try to gauge the impressions (Buss 1980; Leary and Kowalski 1990). Therefore, when customers receive a special treatment, their concerns about the feelings of resentment or hostility from other customers who do not receive the benefit might be aroused (Fournier, Dobscha, and Mick 1998; Henderson, Beck, and Palmatier 2011). Consequently, they tend to experience negative feelings of uneasiness and psychological discomfort associated with the situation of preferential treatment (Drummond et al. 2003; Jiang, Hoegg, and Dahl 2013), which further leads to a lower level of customer satisfaction.

Several moderators have been identified that could mitigate the negative effect of unearned preferential treatment. For example, Jiang, Hoegg, and Dahl (2013) investigated the reactions and characteristics of other customers. The results of their study show that the focal customers are more likely to have a higher level of satisfaction facing a special treatment if (1) other customers react positively to the recipients’ good fortune or if (2) other customers have a higher status compared with the focal customers. In addition, individuals’ relationship with others also plays an important role in influencing their responses to being in an advantaged position (Mattila, Hanks, and Zhang 2013). For instance, research in corporate layoff conditions suggest that the closeness of the interpersonal relationship between the advantaged person and the disadvantaged person can affect the former individual’s attitude and behavioral intentions toward the company (Brockner et al. 1987; Heider 1958). Moreover, prior research suggests that people who interact with friends are not only concerned with their own outcomes but also with their friends’ outcomes (Peters and van den Bos 2008). Therefore, relationship status influences people’s evaluation and perception of preferential treatment. Receiving an unexpected reward is viewed as more negative when it is in front of friends (vs. strangers) (Mattila, Hanks, and Zhang 2013).

The current study also proposes that the effect of relationship status on people’s satisfaction and behavioral intentions when receiving an unearned special treatment can be moderated by individuals’ psychological state of power. Powerful individuals tend to have an agentic view of themselves (vs. communal) and tend to be more self-focused (vs. other-focused; Rucker, Galinsky, and Dubois 2012). Therefore, they will be less likely to be concerned about other customers who do not receive the special treatment. In contrast, powerless people are communally oriented and tend to take other customers—especially close associates—into consideration, which results in less satisfaction with the unearned special treatment. Next, we will review the literature of social power.

Power

Social power has been studied extensively in the domain of social psychology as a pervasive and fundamental component of social systems and hierarchies (Rucker, Galinsky, and Dubois 2012). It is often defined as the ability of a person to influence others or control outcomes (De Dreu and Van Kleef 2004; French and Raven 1959; Galinsky, Gruenfeld, and Magee 2003; Keltner, Gruenfeld, and Anderson 2003; Lewin 1941; Thibaut and Kelley 1959; Vescio, Snyder, and Butz 2003; Weber 1947) by providing or withholding resources valuable to others. Studied primarily outside the domain of consumer behavior, power has been shown to have important consequences related to human behaviors (Rucker, Galinsky, and Dubois 2012), such as stereotyping (Fiske 1993), action orientation (Galinsky, Gruenfeld, and Magee 2003), perceived control (Fast et al. 2009), approach and inhibition systems (Keltner, Gruenfeld, and Anderson 2003), perspective taking (Galinsky et al. 2006), and construal level (Smith and Trope 2006). For example, Fiske’s (1993) power as control (PAC) model suggests that the powerless attend to the powerful who control their outcomes, thereby not forming stereotypical impressions. However, powerful people are more vulnerable to stereotyping because they may not be personally motivated to pay attention. In addition, Galinsky, Gruenfeld, and Magee (2003) propose a positive relationship between power and action. Results of three experiments indicate that individuals with power exhibit a greater action orientation than those without power, regardless of the social consequences of their acts. Similarly, Keltner, Gruenfeld, and Anderson (2003) put forth the approach/inhibition theory of power and argue that elevated power is associated with increased rewards and freedom, and thereby activates approach-related tendencies. Conversely, reduced power is associated with increased threat, punishment, and social constraint, which activate inhibition behaviors. Moreover, Smith and Trope (2006) advance the literature in power by arguing that power creates asymmetric social distance. Specifically, they suggest that people in a high-power status experience more social distance as compared with the ones in a low-power status. Furthermore, Fast et al. (2009) suggest that power leads to an illusion of personal control, which mediates the influence of power on several self-enhancement and approach-related outcomes reported in the power literature, including optimism, self-esteem, and action orientation.

Recently, Rucker, Galinsky, and Dubois (2012) reviewed the concept of power and offered a new framework for understanding how power guides and shapes human behavior, in general, and consumer behavior, in particular. They propose that having power fosters an agentic orientation, and lacking power leads to a communal orientation. The notion of agency and communion as introduced by Bakan (1966, 14-15) are two fundamental modalities and govern human thinking, decision making, and behaviors. Agency refers to the existence of the individual as an agent and manifests itself in “self-protection, self-assertion and self-expansion.” An agentic orientation guides people’s decision making toward advancing their own (vs. others’) welfare and results in increased selfish behaviors (Griskevicius et al. 2009; Hill et al. 2012). In contrast, communion refers to the sensitivity and participation of an individual in some larger social groups (e.g., family, firm, society) and manifests itself in the tendency to consider others in thinking and decision making, which results in greater attention paid to others and reluctance to act without consideration of others. A shift in focus toward one’s own welfare relative to others is the characteristic of an agentic orientation, whereas a shift in focus toward others’ welfare is characteristic of a communal orientation (Abele and Wojciszke 2007).

Rucker et al. (2012) make the connection between power and agentic/communal orientation, and suggest that high-power status can activate individuals’ agentic orientation due to an underlying shift in motivational orientation. The definition of power, which entails relatively more or less possession of resources, supports the link between power and agentic/communal orientations. For example, powerless people are normally lower in the hierarchy, often dependent on others for valuable resources. As such, they are more likely to incorporate others to achieve their goals and satisfy their needs. These characteristics subsequently facilitate and encourage a communal orientation. Such a proposition is consistent with the literature discussing the effects of power on taking action (Galinsky, Gruenfeld, and Magee 2003), illusory control (Fast et al. 2009), psychological distance (Magee and Smith 2013), and physiology (Carney, Cuddy, and Yap 2010).

Based on the agentic versus communal perspective of power, Rucker, Galinsky, and Dubois (2012) further suggest that power shapes how consumers value the self versus others. More specifically, the agentic orientation of high power leads individuals to place greater weight and value on the self, thereby increasing their willingness to spend on themselves (Rucker, Dubois, and Galinsky 2011), the value they ascribe to their possessions, and their allocation of resources to themselves (Piff et al. 2010). In contrast, the communal nature of powerless people increases their dependence on others, thereby enhancing their willingness to spend on others, assigning high value to other people’s possessions and allocating more resources to others.

In the current study, we propose that power will moderate the effect of relationship status on customer satisfaction and behavioral intentions given an unearned preferential treatment. Specifically, the effect of relationship status is only significant among low-power individuals due to their communal orientation, which induces a perception of unfairness and social discomfort. In contrast, high-power individuals will be influenced by the negative feelings (i.e., perceived fairness and social discomfort) associated with receiving special treatment to a lesser extent across relationship status conditions (friends vs. strangers). This is consistent with the agentic-communal perspective on power that posits that powerful people act as if they are more important (Zimbardo 1973), thus deserving the unearned preferential treatment. Our conceptual framework is presented as Exhibit A1 in the appendix.

Hypothesis 1 (H1): There is an interaction effect between power and relationship status on individuals’ attitudes and behavioral intentions when receiving unearned preferential treatment.

Hypothesis 1a (H1a): Powerful individuals have similar level of (1) satisfaction and (2) behavioral intention across relationship status conditions.

Hypothesis 1b (H1b): Powerless individuals have lower level of (1) satisfaction and (2) behavioral intention with the outcome when the disadvantaged others are friends as opposed to strangers.

Hypothesis 2 (H2): The effect of power and relationship status on satisfaction and behavioral intention is mediated by perceived fairness and social discomfort.

Method

Participants and Design

This study uses a 2 (power state: high vs. low) × 2 (relationship status: friends vs. strangers) between-subject design. A total of 151 adult consumers were drawn from a commercial panel and participated in the current study. Participants were fifty-nine percent males, with an average age of thirty-two, and median income of $20,000 to $39,999. Seventy-two percent of the respondents were Caucasian and forty-one percent of them had graduated from college. Thirty-four percent of the participants indicated that they are a member of airline frequent-flyer programs.

Procedure

First, power was manipulated via an episodic prime adapted from Galinsky, Gruenfeld, and Magee (2003). In the high-power condition, participants read,

Please recall a particular incident in which you had power over another individual or individuals. By power, we mean a situation in which you controlled the ability of another person or persons to get something they wanted, or were in a position to evaluate those individuals. Please describe this situation in which you had power—what happened, how you felt, etc.

In the low-power condition, participants were asked to recall an incident in which someone else had power over them. To further reinforce the power manipulation, participants were asked to use four sets of words related to either having power (e.g., authority, control, letter) or lacking power (e.g., servant, submit, letter) to make grammatically correct sentences (Smith and Trope 2006; Magee, Galinsky, and Gruenfeld 2007). Next, participants were presented with a scenario describing a recent incident at an airline ticket counter (adapted from Mattila, Hanks, and Zhang 2013). Participants were asked to imagine that they were traveling and received an unexpected upgrade to first class whereas others (friends or strangers) did not. For example, participants in the “strangers” condition read,

You and some of your friends have decided to fly to Vegas for a fun weekend getaway. Since you are all flying from different airports, you decide to all meet at the hotel around dinner time. You get to the airport, check in curbside, and the agent tells you that you will need to check in with the attendant at the gate to get your seat assigned. You go through security, grab some snacks, and head to your gate. You go up to the counter where you and several strangers are crowded around the ticket counter waiting to get seat assignments. The ticket agent looks at all the passengers around the desk and says, “Who would like to go first?” No one answers, so you say, “I guess I’ll go first.” She says, “Ok, may I have your name?” You give it to her, and as she checks you in, she says, “Would you like to be upgraded to first class?” You are not a member of that airline’s frequent-flyer club, so you ask the agent why you would get upgraded. The agent replies, “No particular reason. I have one empty seat left in first class, so you can have it if you like.” You say, “Sure!” and she gives you your boarding pass.

Participants in the “friends” condition read,

You and some of your friends have decided to fly to Vegas for a fun weekend getaway. Since parking at the airport is a pain, you decide to all carpool together. You check in curbside, and the agent tells you that you will need to check in with the attendant at the gate to get your seats assigned. You go through security, grab some snacks, and head to your gate. You group all crowds up to the counter together and you tell the agent that you need to be assigned seats. The ticket agent looks at you and your friends and says, “Who would like to go first?” You say, “I guess I’ll go first.” She says, “Ok, may I have your name?” You give it to her, and as she checks you in, she says, “Would you like to be upgraded to first class?” You are not a member of that airline’s frequent-flyer club, so you ask the agent why you would get upgraded. The agent replies, “No particular reason. I have one empty seat left in first class, so you can have it if you like.” You say, “Sure!” and she gives you your boarding pass.

After being exposed to the manipulations of power and relationship status, participants were asked to complete a survey to measure their affective and behavioral responses.

Measures

Customer satisfaction with the company’s handling of the upgrade was measured via six items adapted from WestBrook and Oliver (1981) (e.g., “I’m pleased—I’m displeased”; “I’m very satisfied—I’m very dissatisfied”; and “I am happy with this experience—I’m unhappy with this experience” on a 7-point Likert-type scale; Cronbach’s alpha = .95). Behavioral intention was measured with four items on a 7-point Likert-type scale adapted from Zeithaml, Berry, and Parasuraman (1996): “Say positive things about the airline to others”; “Recommend the airline to others”; “Do more business with the airline in the next few months”; and “Consider this airline as your first choice in the category” (Cronbach’s α = .93). Two mediators, perceived fairness and social discomfort, were measured as well. Perceived fairness was measured via three items adapted from van den Bos and Lind (2001): “When considering the upgrade you received from the airline: I think it was fair/appropriate/just” (1 = strongly disagree, 7 = strongly agree) (Cronbach’s α = 90). Moreover, participants were asked to indicate the extent to which they felt uncomfortable, uneasy, awkward, and guilty during the upgrade experience to measure social discomfort (adapted from Jiang, Hoegg, and Dahl 2013; Cronbach’s α = 87). Scenario realism was measured with two items: “This situation is very likely to be real” and “This situation could happen, or has happened, to me or someone I know” on a 7-point Likert-type scale with 1 = strongly disagree and 7 = strongly agree (r = .64, p < .01). Demographic information was collected at the end of the survey.

Results

Manipulation Checks

To check the manipulation of power, participants were asked to indicate the extent to which they felt powerful on a scale from 1 = not powerful to 7 = powerful (Rucker, Dubois, and Galinsky 2011). The results show that participants in the high-power condition felt more powerful compared with the ones in the low-power condition (M_powerful = 4.96, M_powerless= 4.31, t = 3.04, p < .01). In addition, participants’ thoughts were coded by two independent coders who were blind to our hypotheses. The coding reflected participants’ power status—powerful or powerless—on a scale from 1 = powerless to 7 = powerful. We then ran the t test between those two conditions as a way to check the manipulation of power. The results indicated that there is significant difference across the power conditions (M_powerful = 5.65, M_powerless = 3.62, t = 8.69, p value < .001). Therefore, the power manipulation in the current study was successful. To check the manipulation of relationship status, participants were asked to respond to two questions: “The others in line with me were good friends of mine” and “the others in line with me were complete strangers.” The results show that participants in the “friend” condition responded with higher level of agreement to the first statement (M_friend = 5.82, M_stranger = 2.32, t = 15.58, p < .001). However, participants in the “stranger” condition exhibited more agreement toward the second statement (M_friend = 2.35, M_stranger = 5.73, t = −13.19, p < .001). Thus, the scenario successfully manipulated relationship status. In addition, participants rated the scenarios as realistic (M = 5.32 on a 7-point scale, SD = 1.49).

Dependent Variables

To test the hypotheses empirically, a 2 (power state: high vs. low) × 2 (relationship status: friend vs. stranger) multivariate analysis of variance (MANOVA) was performed on customer satisfaction and behavioral intention after receiving the airline upgrade. The MANOVA results revealed a significant main effect of power on behavioral intention, F(1, 147) = 6.50, p < .05, and a significant main effect of relationship status on satisfaction, F(1, 147) = 8.41, p < .01, and behavioral intention, F(1, 147) = 5.02, p < .05. These main effects are qualified by a marginally significant interaction effect between power and relationship status on customer satisfaction, F(1, 147) = 3.53, p = .062, and a significant interaction effect on behavioral intention, F(1, 147) = 6.42, p < .05 (see Exhibit 1). Thus, H1 was partially supported. Specifically, both H1a and H1b were marginally supported with respect to the dependent variable of satisfaction. However, both H1a and H1b were supported when the dependent variable was behavioral intention. The interaction effects are visualized in Exhibits 2 and 3.

Exhibit 1:

MANCOVA and Univariate Follow-Up Results.

		Univariate Follow-Ups
Source	Pillai’s Trace (p Value)	Dependent Variable	Type III SS	df	MS	F	p Value
Test effects
Power	0.047 (.031)	SAT	3.183	1	3.183	3.397	.067
Power	0.047 (.031)	BI	9.608	1	9.608	6.496	.012
Relationship status	0.061 (.010)	SAT	7.875	1	7.875	8.405	.004
Relationship status	0.061 (.010)	BI	7.418	1	7.418	5.015	.027
Power × Relationship status	0.47 (.031)	SAT	3.310	1	3.310	3.532	.062
Power × Relationship status	0.47 (.031)	BI	9.493	1	9.493	6.418	.012
Error	—	SAT	137.736	147	0.937
Error	—	BI	217.423	147	1.479
Total	—	SAT	666.194	151
Total	—	BI	5,068.750	151
Corrected total	—	SAT	152.537	150
Corrected total	—	BI	244.497	150

Note. MANCOVA = multivariate analysis of covariance; SS = sum of squares; MS = mean square; SAT = satisfaction; BI = behavioral intention.

Exhibit 2:

The Interaction Effect of Power and Relationship Status on Satisfaction.

Exhibit 3:

The Interaction Effect of Power and Relationship Status on Behavioral Intention.

To understand the interaction effect, planned contrasts were performed, and the results suggest that participants in the powerful condition responded with similar levels of satisfaction (M_friend = 1.78, M_stranger = 1.62, t = .708, p =.481) and behavioral intention (M_friend = 5.94, M_stranger = 5.88, t = .231, p = .818) toward the upgrade regardless of whom they were with (i.e., friends or strangers). However, participants in the powerless condition exhibited lower level of satisfaction (M_friend = 2.36, M_stranger = 1.61, t = 3.441, p <.01) and behavioral intention (M_friend = 4.94, M_stranger = 5.88, t = −3.112, p <.01) when they were with friends as compared with strangers.

Following Hayes’s (2012) procedures, mediation analyses were conducted to examine the mediating roles of perceived fairness and social discomfort. For perceived fairness, the results for both dependent variables support the mediating effect (95% bootstrap confidence interval for satisfaction = [.0116, .2425]; 95% bootstrap confidence interval for behavioral intention = [−2947, −.0173]; number of bootstrap samples = 5,000). Similarly, the results support the mediating effect of social discomfort on satisfaction (95% bootstrap confidence interval = [.0587, .3944]) and behavioral intention (95% bootstrap confidence interval = [−.2648, −.0040]; number of bootstrap samples = 5,000). As the confidence intervals for indirect effects do not include zero, the mediations are significant (see Exhibit 4). Therefore, H2 was supported.

Exhibit 4:

Mediation Analysis.

Coefficient (SE)	a (Path from IV and Moderator to Mediator	b (Path from Mediator to DV)	c (Conditional Direct Effect of IV on DV)	a × b (Conditional Indirect Effect of IV on DV, 95% Confidence Intervals)
Perceived fairness
Satisfaction	.4080*	.1956*	.6615*	[.0116, .2425]
Behavioral Intention	.4874*	.2291*	.8378*	[−.2947, −.0173]
Social discomfort
Satisfaction	.7193*	.2653*	.5385*	[.2587, .3944]
Behavioral Intention	.7193*	.1384*	.8335*	[−.2648, −.0040]

Note. Mediator analyses were conducted following the procedure in Hayes (2012) and are summarized in the table for the sake of brevity. IV = independent variable; DV = dependent variable.

p < .05.

In addition, a follow-up study was conducted with individuals’ sense of power being measured to triangulate on the effects. More specifically, power was measured via eight items adapted from Anderson and Galinsky (2006) and Anderson, John, and Keltner (2012). Dependent variables and mediators were the same as the main study. Two spotlight analyses were performed on customer satisfaction and behavioral intentions, respectively. The results were consistent with the main study. For customer satisfaction, a regression was performed on satisfaction with independent variables including (1) a dichotomous variable for relationship status, (2) sense of power, and (3) the two-way interaction. The results reveal a marginally significant two-way interaction between power and relationship status (b = .43, t = 1.75, p = .08). To explore the interaction, we examined the effects of relationship status at one standard deviation above and below the mean via a spotlight analysis. The spotlight analysis at one standard deviation above the mean power score showed that participants in the friends and strangers conditions showed similar levels of satisfaction (M_friends = 3.95, M_strangers = 4.28, t = .62, p = .54). A similar spotlight analysis at one standard deviation below the mean power score showed that participants in the strangers condition showed higher satisfaction than the ones in the friends condition (M_friends = 5.26, M_strangers = 4.32, t = −1.99, p =.055), although such a difference is marginally significant. As for behavioral intention, a spotlight analysis at one standard deviation above the mean power score showed that participants in both of the relationship status conditions exhibited similar levels of behavioral intentions (M_friends = 4.85, M_strangers = 4.00, t = 1.35, p =.19). A similar spotlight analysis at one standard deviation below the mean power score showed that participants in the friends condition showed lower levels of behavioral intentions as compared with their counterparts in the strangers condition (M_friends = 2.75, M_strangers = 4.23, t = 2.36, p < .05). Moreover, the mediating effect of perceived fairness and social discomfort was supported as well.

Discussion

Unexpected upgrades of rooms or airline seats are often used in the hospitality industry as a way to delight customers, heighten satisfaction, and create loyalty. Such preferential treatment has been found to encourage stronger customer–brand relationships, more positive word-of-mouth, and increased purchase intentions (Lacey, Suh, and Morgan 2007). However, when a customer is the recipient of unearned preferential treatment, it can often lead to lower customer satisfaction and lower behavioral intention due to perceived unfairness and social discomfort (Jiang, Hoegg, and Dahl 2013; Mattila, Hanks, and Zhang 2013; van den Bos et al. 1997; Xia and Monroe 2010). This is particularly true when others around the focal customer do not receive the same treatment and even more so if the others are close friends or associates of the person receiving the preferential treatment (Mattila, Hanks, and Zhang 2013). These lower levels of satisfaction and behavioral intention are of concern to hospitality managers as the purpose of the upgrade is to create happy, loyal customers.

To this end, the current study investigates one factor that may moderate the impact of relationship status on customer satisfaction after an upgrade—the psychological state of power. Because being in a powerless state fosters a more communal, other-focused orientation (Rucker, Galinsky, and Dubois 2012) whereas being powerful results in an agentic, self-focused orientation, we hypothesized that power would moderate the effect of relationship status on individuals’ satisfaction and behavioral intentions when receiving unearned preferential treatment.

Our results offered partial support for this hypothesis. We found that participants in the powerful condition responded with similar levels of satisfaction and behavioral intentions after the upgrade, regardless of whether they were with friends or strangers. However, participants in the powerless condition exhibited a lower level of behavioral intentions when they were with friends who did not receive an upgrade, as compared with when they were with strangers. These same individuals also exhibited a lower level of satisfaction when they were upgraded in front of friends as compared with in front of strangers, although this effect was marginally significant. The results lend support to the idea that customers who are low in power tend to be more communally focused, as they rely on others in their social milieu for support and resources. This focus on others, particularly friends, appears to result in less positive evaluations when the customers receive preferential treatment that their friends did not receive, but only if they know the others. In addition, the results support the mediating effects of perceived fairness and social discomfort, which is consistent with prior research (Jiang, Hoegg, and Dahl 2013; Mattila, Hanks, and Zhang 2013). It follows that for low-power customers, who are communally focused and rely on others in their immediate social groups for support and help, receiving special treatment may cause concerns about the feelings of resentment or hostility from their friends who do not receive the benefit (Fournier, Dobscha, and Mick 1998; Henderson, Beck, and Palmatier 2011). Consequently, they tend to experience uneasiness and psychological discomfort associated with their preferential treatment (Drummond et al. 2003; Jiang, Hoegg, and Dahl 2013; Lewis 1995), which further leads to a lower level of customer satisfaction and behavioral intentions.

One interesting finding was that for powerless individuals, receiving an upgrade while their friends did not led to significantly lower levels of behavioral intentions, but the impact on satisfaction was only marginally significant. One possible explanation for these results is that people in a powerless state are less consistent in their cognitive processing. Prior research has suggested that powerful people are better able to focus on the central aspects of a scene or task, filtering out peripheral, non-goal-related information. Powerless people, however, lack such filters, resulting in greater difficulties in cognitive processing and less consistent outcomes (Guinote 2007). Another possible explanation is that advantageous inequity tends to induce conflicting responses in the recipient—a positive, pleasure-based response at receiving the benefit, and a fairness-based negative feeling due to the iniquity of the situation (Mattila, Hanks, and Zhang 2013; van den Bos et al. 2006). It is possible that these two responses map unevenly onto satisfaction and behavioral intention. Our study did not parse out these relationships, but it would be interesting for future studies to examine whether these mixed emotions are weighted differently when evaluating the two different dependent variables.

Implications

As upgrades are frequently used in the hospitality industry as a customer satisfaction and retention strategy, our findings have both theoretical and managerial implications. First, most of the hospitality research focuses on the positive consequences of preferential treatment (Kim and Mattila 2010; Vanhamme and Snelders 2001) and argue that a positive surprise leads to an extreme level of satisfaction—delight. However, our findings contribute to the hospitality literature by demonstrating that unearned preferential treatment could negatively influence customer satisfaction and behavioral intentions. More importantly, we extend the literature of preferential treatment and introduce power as a moderator. Our results suggest that an enhanced power state has the ability to attenuate the negative effect of preferential treatment on customer satisfaction and behavioral intentions. To the best of our knowledge, this is the first study connecting power and preferential treatment in the hospitality literature.

In addition, our study contributes to the power literature by providing further support for the agentic/communal perspective of power (Rucker, Galinsky, and Dubois 2012) and demonstrating that power has the ability to activate an agentic orientation. Moreover, we extend the power literature by examining how power influences the way individuals evaluate a situation in which they experience positive inequality. Our results indicate that powerless people, as opposed to powerful ones, are more sensitive to positive inequalities, especially in the presence of others with whom they share a communal relationship (i.e., friends).

Our results also carry implications for hospitality managers and marketers. Our findings suggest that if a customer is to receive an upgrade that others do not receive, those in a powerful state will derive more satisfaction from the situation and be less sensitive about the outcomes of other people. Thus, it would be advantageous to induce a sense of power in customers who are to receive an upgrade. For example, servers or hotel front desk agents could induce a feeling of power in customers by offering the customer a choice of upgrade rewards. The powerful-inducing act of making a choice may then lead to a more favorable evaluation of the upgrade.

Our results also shed light on the reactions to preferential treatment of those in a powerless state. In a world of the National Security Agency (NSA), long security lines, crowded airports, and flight delays, many people could indeed feel powerless while traveling. Our findings suggest that when such individuals are traveling with friends, it may be advisable to offer upgrades to their entire party, if possible, to engender a sense of fairness and increase satisfaction and loyalty. Although it is easy to identify all the members of a party at a restaurant, it is less so in a hotel or airline reservation situation. To assist with this, reservation websites and agents could give customers the option to link their reservations with those of their friends. For example, some airline companies allow customers to connect two independent reservations to indicate that multiple parties are traveling together. This would make it easier for agents/airlines to identify customers who travel as a group and avoid the situations when only one group member receives the upgrade while the others do not.

Limitations and Future Research

As with any research, the present study has limitations. First of all, we used a scenario-based experimental design to manipulate individuals’ psychological state of power. In social cognition, the assumption that the priming effect can occur automatically and outside of conscious awareness is almost taken for granted (Bargh 2006). In recent years, however, researchers have suggested that direct replication attempts seem to be rare in the priming literature and the few direct replication attempts that have been publicly reported so far have failed to find any of these priming effects whatsoever (Doyen et al. 2012; Pashler, Coburn, and Harris 2012). Therefore, to ensure the robustness of the power effect in the context of preferential treatment, future research should consider a quasi-experimental design with power being measured instead of primed.

Second, our scenario was set in the context of an airline upgrade. Although we would expect similar results for a hotel upgrade, replication in a hotel context would strengthen support for our hypotheses. Moreover, our results showed that for people in the powerless condition, receiving an upgrade while their friends did not resulted in a significant decrease in behavioral intentions, but only a marginal decrease in satisfaction. Further investigation into the mechanism behind this discrepancy would be fruitful.

In addition, our study examines the reactions of a customer traveling with friends or strangers. However, families often travel together, and it is possible that the relationship statuses and power structures in a family differ from those between friends or strangers. Future studies could focus on the family as a context in which to examine power effects. As mentioned in the discussion, it is possible that the mixed emotions experienced by a customer receiving preferential treatment are manifested differently when measuring satisfaction and behavioral intention. This suggests an interesting area for future research.

Finally, prior research has identified two different types of power—social power and personal power (Lammers, Stoker, and Stapel 2009). Social power describes power as the ability of a person to influence others (Weber 1978), whereas personal power refers to the ability to do and get what you want, without being influenced by others (Emerson 1962; French and Raven 1959). People with a communal orientation (e.g., collectivists) tend to conceptualize power as more socialized, whereas those with an exchange orientation (e.g., individualists) tend to conceptualize power as personalized (Chen, Lee-Chai, and Bargh 2001; Torelli and Shavitt 2010). Therefore, people’s orientation might further moderate the effects of power such that a communal orientation leads to more negative responses than those with an exchange orientation, especially when with friends (vs. strangers). Further investigation is needed to explore the moderating effect of individuals’ orientations.

Footnotes

Appendix

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, or publication of this article.

Author Biographies

Lu Zhang is an assistant professor in the School of Hospitality Business, Michigan State University. Her research focuses on consumer behavior and information processing.

Lydia Hanks is an assistant professor in the Dedman School of Hospitality, Florida State University. Her research focuses on consumer behavior and emotion.

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