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Balancing risk and reward in survey incentives

The current issue of Survey Practice has an interesting little piece on the use of lottery incentives in online surveys. (Here I quickly point out that the correct terminology should be "sweepstakes" since there are legal issues around anyone but governmental entities running lotteries, but let's not get distracted by that.) In self-administered surveys like online the right incentive can have a significant impact on response rate. We all would like to pay an attractive incentive contingent on completion, but money always is an issue. Sweepstakes have long been a favorite of clients looking to boost response without spending a lot of money. My recollection of the literature on this topic is that sweepstakes are better than no incentive at all, but nowhere near as effective as paying everyone who completes.

The article describes an experiment to answer a question that I get asked all the time: is it better to offer one big prize or several smaller prizes? If I have $1000 to spend will I get more bang from that as a single prize or as four $250 prizes or even 10 $100 prizes. The answer from this particular research is the standard answer to virtually all methodological questions: it depends. The authors argue that the key is the economic circumstances of the target respondents. Professionals, who presumably are reasonably well off, respond at a higher rate when a single large prize is offered. Students, on the other hand, are more persuaded by the greater odds of winning a smaller amount of money.

This makes a lot of sense to me. I am embarrassed that I never figured it out on my own.

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