From: Chris Rasch (crasch@openknowledge.org)
Date: Sun Feb 18 2001 - 17:05:35 MST
Thanking Web Sites, With Cash
By MICHELLE SLATALLA
February 15, 2001
New York Times
http://www.nytimes.com/2001/02/15/technology/15SHOP.html?pagewanted=all
ALL me stingy, but I
can't think of a single
time I suddenly got the urge
to pay for something I had
been getting free and could
continue to get free.
But that is exactly what
Amazon.com had in mind
last week when it instigated
a new scheme called the
Honor System. It's a way for
people to use the
one-click-shopping
concept to make voluntary
payments from $1 to $50 for
intangible things - humor,
advice, recipes - that they
usually get free from
Internet sites like Hearing
Voices.com, an archive of
radio clips, and SatireWire,
which publishes humorous
articles.
SatireWire's FAQ about
the program summed it up
nicely:
Question: If I give money,
what do I get out of it?
Answer: More SatireWire.
Better SatireWire. Maybe
both.
Question: That's it?
Answer: No, you can buy
one of those singing fish
wall plaques and pretend we
gave it to you.
I like to think I have an
open mind. So when
Amazon.com's founder, Jeff
Bezos, phoned to encourage
me to use the Honor
System, I asked in as nice a
tone as I could muster what
would ever possess me to pay for something I could get free.
"Well, if you get something of value, you should pay for it,"
Mr. Bezos said.
"Like love?" I asked.
"Like pineapples," he said.
Mr. Bezos explained that he got the idea for the Honor
System about two years ago while visiting Hawaii. "I
stopped at a roadside stand," he said, "and there was a little
sign that said: `Gone for two hours. Put money in the box
and take the pineapples you want.' The Web is sort of like
that. You can't just take the pineapples."
Actually, it's not the same at all. People are used to paying
for pineapples. Pineapples are a tangible product with a
specific, market-driven price. Like, say, books.
"Why don't you implement an honor system for paying for
your books?" I asked. "Send me the book, and if I like it, I'll
send you money."
But Mr. Bezos, who perhaps saw my argument for the
callow attempt it was to get something for nothing, pointed
out that an honor system is a less efficient way to pay for
something like a book, where the marginal cost of supplying
the product is relatively high. An honor system works for
situations in which a supplier has a fixed up-front cost and
is in effect offering products that cost nothing extra - like
surplus pineapples left over after the rest of the crop went
to the grocery store, or humorous articles whose cost will
not change after they are posted on a site.
Mr. Bezos said he thought that the potential market was
big. Maybe, he said, it would help me to think of honor
system payments as tips, like the money that restaurant
diners leave on the table.
Mr. Bezos was not the first to have this idea. At a site called
Tipjar.com, in operation for five years, you can pledge
money to anyone with an e- mail address. Unlike
Amazon.com, which charges the recipient a 15-cent
transaction fee and then skims a 15 percent commission
from the total donation, Tipjar.com is a free service.
Donors mail checks to the founder, David Nicol, who puts
the money in an interest-bearing account, then mails the
recipients a check once a month. "About 10 people a day
send tips," Mr. Nicol said, "typically of $2 or $3. If more
people used it, I would earn enough money from the
interest-bearing account to pay for my postage costs."
That made me wonder if patrons leave tips based on what
they think the service is worth or, more likely, if they leave
15 percent to conform to a perceived price point
established by cultural precedent.
In fact, a recent study of tipping behavior at the Cornell
University School of Hotel Administration, conducted by
Prof. Michael Lynn, found the quality of service made only
a minor difference in the amount people left, suggesting
that diners feel they are paying a fixed price established by
custom. But in another study he conducted, in which diners
at a Mexican restaurant in Ohio were given a choice of four
tip prices for a dish they had eaten, Professor Lynn found
that about 40 percent of people chose to pay more than they
had to, perhaps because they had consumed big portions or
because they didn't want to appear cheap.
Curiously, diners who ordered a dish called El Puerco ("the
pig") most often felt compelled to pay the highest price.
Whether ordering something called The Pig heightens your
sense of needing to make a good impression, Professor
Lynn said he didn't know. "That dish was also a big
portion," he said.
Similar tipping behavior has been observed among people
who obtain shareware, Professor Lynn said, noting that at
least one shareware author reported that nearly 40 percent
of users sent a bigger payment than requested for a software
program they found particularly useful.
"There's a norm of reciprocity in nearly every country,"
Professor Lynn said, "the idea that when people do you a
favor, you need to pay it back."
I scanned Amazon.com's list of 50 participating Honor
System sites to find one to do me a favor.
Yumyum.com caught my eye. With its database of nearly
20,000 eclectic, homey recipes organized into 16 categories,
like Soups and Stews and Cakes/Pies, Yumyum.com's
mission was to help the sort of home cook who is not too
snooty to occasionally use "boxed cake mix" as an
ingredient. Although some of the site's more fanciful
recipes were unsuitable for serving as an entrée to children
clamoring for dinner (Wesley's Secret Eggplant Recipe,
which called for drinking a liter of bourbon while grinding
up eggplants in a garbage disposal comes to mind), I printed
out recipes for lemon poppy seed muffins and for spicy
Sopa de Albóndigas, or Meatball Soup.
But then I made meatloaf instead. Why was I having such a
hard time getting over the emotional hump of making a
donation? What kind of person would use the Honor
System?
To find out, I phoned Geoffrey Falk, an office assistant who
sent $10 to SatireWire. He is a Canadian. "Boy, it's tough to
say why I did it," Mr. Falk said. "I guess SatireWire fills a
comedic void in my life. I wanted to show my appreciation."
With that in mind, I made the lemon poppy seed muffins.
They were passable. So I went back to the Yumyum.com
home page and, with $1 in mind, clicked on the Click to
Give box that would take me to an Amazon.com server to
complete the credit card transaction. That's when I saw
that Yumyum.com had set a $3 minimum on contributions.
I gave the dollar to SatireWire instead.
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