On the goal gradient hypothesis

The goal gradient hypothesis suggests, that people accelerate their effort as they got closer to the goal. This bachelor thesis aims to provide marketing managers insight on the applicability of this phenomenon on boosting their marketing initiatives, particularly loyalty programs.

To that end, various studies on the goal gradient hypothesis were collected and analyzed. Their study designs, validity, and reliability were analyzed to yield a comprehensive evaluation of their findings. Three moderating variables that may enhance the goal gradient hypothesis were also identified: distance to reference points, the progress framing, and reason for endowment and medium of the progress. The qualitative and meta-analysis showed that the goal gradient hypothesis has a medium positive effect size, which suggest that a decrease in psychological distance to goal leads to a medium acceleration of efforts toward the goal.

Afterwards, the researchers presented their own experiment to investigate the phenomenon further. This experiment aimed to retest the impact of perceived distance on effort acceleration. The impact of three aspects (reasons for endowment, frequency of purchases, and cultural context) on the prevalence of the Goal Gradient Hypothesis were also investigated. The goal gradient hypothesis’s small effect was not observed in the experiment. Nevertheless, its results suggest that Indian people are more likely to join the program the loyalty program compared to both Europeans and American people. Various potential future research directions to investigate the Goal Gradient Hypothesis further include the impact of the type of reward offered and the prevalence of the phenomenon on other types of marketing initiatives.

Lastly, various managerial implications were proposed. An ideal loyalty program would be partially complete, which includes a reason for the endowment. It should also record the customers’ progress in the form of artificial currency such as points. Furthermore, temporal progress should be tracked. The proposed design should also include indicators of the customers progress and of their distance to the middle and end points. These changes are expected to yield numerous benefits, such as an increase in the customers’ likelihood to participate and predicted greater retention as well as reengagement in the program.