Easy as 1, 2, 3: The Motivating Power of Streaks | Marissa Sharif

How Do Streak Rewards Work?

Dan Loney: One of the ways that companies say “thank you” to employees is through the use of financial incentives. But do employees increase their efforts when the incentives are increased in the process, thereby creating somewhat of a streak? Marissa Sharif is an associate professor of marketing here at the Wharton School and has been part of research taking a look at this. Let’s start by asking what was behind the want to look at this in the first place?

Marissa Sharif: It was motivated by noticing a lot of apps are using gamified rewards to try to motivate people to do a variety of actions. One popular one is actually rewards that encourage streaks, or encouraging people to do actions in a row or to do an action every day. For example, Duolingo is one of the companies that does this. They try to encourage people to learn a language, so they give people rewards when they try to study or do a lesson daily.

We saw that this was a common thing that a lot of companies were doing. But we wanted to see, is it actually effective? Is there research to show this does motivate people? That’s kind of where it started, just by noticing it’s a common phenomenon. Let’s test if it actually is effective or not.

Loney: Part of this was also whether or not people complete the work better when there was more on the line, correct?

Sharif: There’s a lot of research that shows incentives and rewards motivate people. We know that. We also know that rewards can be more effective when they’re designed with psychology and human behavior in mind. What we were really interested in here is examining whether people persist more or complete more work tasks with a specific type of reward structure, which is a reward structure that encourages consecutive behaviors or streak-like behaviors.

We wanted to compare to see if these rewards that encourage streaks are more effective than other rewards, such as just a flat reward. Every time you do something beneficial, you just get the same amount. So, it was specifically looking at the streak reward structure.

Loney: That element of persistence, I know, is an important component to this research as well.

Sharif: It’s important because it’s a common problem. A lot of people struggle to keep doing the same action and reach their end goal. They give up before they get there. And that applies to personal goals, like learning a new language or trying to get fit, as well as goals that are beneficial for an organization and a goal an employee might have.

It’s important, in our context, that streak rewards boost commitment towards a goal. People feel more committed, and commitment is especially important with things like goal persistence.

Loney: If you’re having people more committed to doing projects and doing work, that probably helps the company in general, to a degree, in terms of retaining employees.

Sharif: Yes, exactly. And what we find is it’s specific to the task or the goal they’re working towards. They feel more committed to reach their goal. That will definitely be more beneficial to the company in that they’re going to probably reach that goal sooner and/or be more likely to reach the goal to begin with.

The Gratification of Reaching a Goal

Loney: There were a variety of different studies that you did to collect this research. Give us a la synopsis as to how you went about this.

Sharif: There’s one paradigm that we used in different ways throughout, which is basically we have people make a series of choices. They make a choice between doing a work-like task versus doing something more fun. For example, in some studies we have them define a series of words. In others, we have them type a series of CAPTCHAs. Things that people don’t like that much versus something they might like a little bit more. For example, watching a short clip of a comedy show.

We did this because we’re trying to mirror what happens in the real world, that we often have choices about whether we want to engage in work right now or do something we like better instead. If I’m an employee, maybe I’m doing some type of gig work. I’m delivering a bunch of orders. I could choose to deliver another food order, or choose to do something else that I might like instead. If I’m in sales, maybe I choose whether I want to do another call versus do something else I like instead. That’s the basic idea. We’re looking at the number of times people choose to do work rather than fun.

Loney: While the financial component is obviously important, it sounds like there’s an element of actually completing the goal that’s very important for the employees as well.

Sharif: Yes. We’re looking here to see if they’re willing to keep going towards the work or keep going towards the goal, compared to giving in and doing something of a want behavior instead. Something that is immediately gratifying instead. What we wanted to look at in particular in this paradigm is how do the different reward structures shift people’s choices such that they choose to do work more often than they choose to do these “should” or immediately gratifying behaviors.

We had one group of people, every time they chose to do the work task, they would be paid the same amount on top of their participation payment. For example, in one study, they were paid just a 3-cent bonus for choosing the work. Every time they chose the work, they would get that 3-cent bonus. The streak condition, on the other hand, they started actually with a lower payment. The first time they chose to do work, they would get 1 cent. If in the next consecutive choice, they again decided to do work, they would get 2 cents. If they chose again after that to do work, they would get 3 cents, right? It increases their reward if they do a consecutive choice of choosing the work. And if they don’t do a consecutive choice, they break their streak, they go down to a lower payment, or just don’t have the ability to go up.

We varied that throughout our paradigms. And what we found is that even though with the stable flat reward, it’s a little bit more than the streak reward in terms of payment, people end up doing work more with the streak reward structure than the work reward structure. In the paper, we generalize it. We do a bunch of robustness checks where we change what the tasks are, we change the payment levels to be a little bit higher, a little bit lower, and we try to disentangle it to really show it’s about encouraging people to do consecutive actions that really motivate them.

From Incentive Programs to Everyday Motivation

Loney: For many people, does that element of the streak tie into our competitiveness in the workplace or in life in general? Once we have that first taste of success, we want to have that next taste along the line?

Sharif: Yeah. It’s related to why we think it works. What we think is happening is the streak rewards encourage commitment or increase commitment because once you do that first task, like you said, you don’t want to miss out on the potential earnings you get, that increase in earnings, if you don’t do the next task. You want to see your effort reap maximum rewards. I don’t want to miss out on that potential increase in bonus by not doing the next task.

There’s a lot of research related to this idea that people don’t like to see their effort wasted. When people are reminded of their effort in general, they feel more committed to that process. So, what you’re speaking of is related to why we think it is effective and why it boosts commitment.

Loney: How does that relate back to companies in terms of having these types of incentive programs?

Sharif: I think the easiest conclusion here is incorporating the idea that streaks and rewards can be motivating to people and help them keep persisting and do better work compared to just these flat basic rewards. Broader, just thinking more about how you can incorporate ideas of psychology and human behavior into your reward structures to motivate people more in general.

Loney: While the finances are nice, it’s not always the be all, end all to have the level of success that you want from a project in the office.

Sharif: Yeah. We find, compared to rewards that are a little bit smaller— there’s a small magnitude difference here— that streak rewards end up being more effective than slightly larger rewards. And that’s because we end up being more motivated by elements related to human psychology and human behavior than just the pure finances of it. But we have to take caution that it’s not going to be a huge difference in financial payment, but a little bit, I think.

Loney: Why is this so important from a research perspective?

Sharif: In general, it’s a really broad problem. It extends to organizations and employees, but it’s for all of us that we all struggle to persist towards our goals. Anyone you’ve talked to, I’m sure they have an experience of, “Hey, I wanted to reach this goal, but I just couldn’t quite get there. I started, but I didn’t complete it.” So, in general, that is an important area.

Then second, it’s thinking, “Hey, we have this great tool. We have a way to motivate people, which is rewards. How do we make those rewards even more effective for such a big common problem?” I think it’s speaking to this important area in that way.