Save More Today or Tomorrow: The Role of Urgency and Present Bias in Nudging Pre-commitment

Abstract

To encourage farsighted behaviors, past research suggests marketers may be wise to invite consumers to pre-commit to adopt them “later”. However, across a large, multi-site field experiment of retirement savings decisions and three pre-registered laboratory studies (N=10,255), we find no consistent benefit from simultaneously offering consumers the opportunity to adopt farsighted behaviors now or later. Contrary to predictions of experts we surveyed, what we call “simultaneous pre-commitment” does not always increase farsighted behavior over simply offering consumers the option to adopt farsighted behaviors now and can even be harmful (e.g., reducing savings). We theorize that two opposing mechanisms account for this result. First, simultaneous pre-commitment leverages present bias and decreases the anticipated costs of adopting farsighted behaviors, thus increasing adoption. However, simultaneous pre-commitment also leads people to infer that taking action is not urgently recommended, which decreases adoption of farsighted behaviors (particularly immediate adoption). We also find that the design of pre-commitment moderates this effect: offering pre- commitment after someone declines to adopt a farsighted behavior now actually increases inferred urgency, boosting adoption.