Social norms and market norms are separate and you must not mix them. Social norms prevail in social situations. For example, if two friends go out skiing and one friend gives the others some pointers just for fun, that’s a social situation and social norms prevail. The instructor would find it absurd to be given cash at the end of it, but might feel slighted if the student didn’t invite him to his Super Bowl party. If a person goes out and hires a professional ski instructor, the ski school requires the student to pay full freight, but the instructor has no expectation of being invited to the student’s party.

In most of our lives, it’s clear which realm were in. However, in Predictably Irrational, which I’ve mentioned before, Dan Ariely shows the danger of mixing these two realms, because if you do, market norms typically win, though by themselves social norms can have a bigger effect. For example, when they pay people to do tasks, the people who are paid tend to perform more work in a given amount of time as their pay increases. But those who do the work as volunteers actually do more work than any of the paid subjects (see pages 70-75). People love to help other people and in the social realm we work for the good feeling that we get from doing something for someone. This is so powerful, in fact, that research shows that giving to others makes us happier than does buying something for ourselves.

You mess this up if you tell Aunt Marge how much your gift bottle of wine cost. Even if she knows it’s cheap or expensive, even if she knows the exact dollar worth of the wine, it fits within the context of social norms until the price is explicitly mentioned. But then, no matter what the price, it fits within market norms.

Companies mess this up all the time by trying to ingratiate themselves, pretend you have a relationship, you and the company are friends. But the second they hit you with a late fee and refuse to budge, the second they tell you that they have policies and can’t treat you differently than everyone else, they have violated the social norm and entered the realm of market norm. If it has always been a market relationship, that presents no problem. But if you’ve been courted like a friend, like your relationship is personal, like you won’t be treated like everyone else, the abrupt reentry into the realm governed by market norms feels like a betrayal. You end up having stronger negative feelings toward the company than you do towards companies for whom they never had any warm fuzzy feelings. It’s like the difference between hailing a cab and, upon reaching the destination, being asked to pay the fare. No problem. But if you ask a friend for a ride to the airport and at the destination you’re asked to pay “just half” of the cab fare because “we’re friends”. It’s a stab in the back and when companies act this way, they should be prepared to have accounts closed and to see virulent blog posts and horrid word of mouth publicity.

Ariely puts it thus:

If you’re a company… you can’t have it both ways. You can’t treat your customers like family one moment and then treat them impersonally — or even as a nuisance or a competitor — a moment later when this becomes more convenient or profitable.

Personally, I never become “friends” with companies, only with people. So no matter how much I respect a business, I don’t buy t-shirts with their logo and I don’t put their stickers on my car. So I’m disloyal, but I’m safe. But what about all those people who not only buy ice cream, but buy a Ben and Jerry’s t-shirt, that is they pay for the right to wear advertising?

Of course, I can be bought cheap. If I don’t hate your company and there’s a free t-shirt in it…