Commercial or communal: Why is outsourcing taboo for churches and pharmaceutical companies?

Consumers hold churches and pharmaceutical companies to different moral standards than other organizations, according to a new study in the Journal of Consumer Research.

"Imagine the CEO of a pharmaceutical company who declares that he is in the business of maximizing shareholder profitability and fully intends to charge profit-maximizing prices for his company's offerings - and those prices should be very high because of limited competition," write authors Peter McGraw (University of Colorado Boulder), Janet A. Schwartz (Tulane University), and Philip E. Tetlock (University of Pennsylvania). Or what if churches outsourced backlogged prayer requests to priests in Third World countries in the name of efficiency?

Consumers would be outraged by such announcements, yet these types of profit- and efficiency-seeking behaviors are common practice in other types of organizations. Why do people hold some organizations to different standards? The authors found that consumers believe that some organizations (like churches and pharmaceutical companies) should be focused on communal rather than market-based principles.

The authors found that people expect and approve of communal behavior from churches (like hosting open-enrollment classes) and pharmaceutical companies (ensuring access to drugs for the needy). But when participants perceived that the organizations were acting out of commercial interests (outsourcing prayers or setting drug prices high to maximize profits), they became disturbed. "One experiment, for example revealed moral outrage in response to a pharmaceutical company raising the price of a successful drug to make up for losses on the development of another drug," the authors write. "Yet a software company engaging in the same kind of marketing strategy elicited little negative reaction."

Organizations can communicate with consumers in ways that will help people understand their underlying motives. For example, participants were less upset with a church that outsourced prayers to India when the church pointed out that everyone is part of God's community and that Indian and U.S. priests are equals.

Peter McGraw, Janet A. Schwartz, and Philip E. Tetlock. "From the Commercial to the Communal: Reframing Taboo Trade-offs in Religious and Pharmaceutical Marketing." Journal of Consumer Research: June 2012 (published online September 23, 2011).

Most Popular Now

AstraZeneca to acquire CinCor Pharma to strengthen…

AstraZeneca has entered into a definitive agreement to acquire CinCor Pharma, Inc. (CinCor), a US-based clinical-stage biopharmaceutical company, focused on developing no...

NextPoint Therapeutics announces $80 million Serie…

NextPoint Therapeutics, a biotechnology company developing a new world of precision immuno-oncology, announced today that it raised $80 million in Series B financing co-l...

Time-restricted eating reshapes gene expression th…

Numerous studies have shown health benefits of time-restricted eating including increase in life span in laboratory studies, making practices like intermittent fasting a ...

Incurable liver disease may prove curable

Research led by Associate Professor Duc Dong, Ph.D., has shown for the first time that the effects of Alagille syndrome, an incurable genetic disorder that affects the li...

Scientists develop a cancer vaccine to simultaneou…

Scientists are harnessing a new way to turn cancer cells into potent, anti-cancer agents. In the latest work from the lab of Khalid Shah, MS, PhD, at Brigham and Women’s ...

Bayer to accelerate drug discovery with Google Clo…

Bayer AG and Google Cloud announced a collaboration to drive early drug discovery that will apply Google Cloud's Tensor Processing Units (TPUs), which are custom-develope...

COVID-19 vaccines, prior infection reduce transmis…

Vaccination and boosting, especially when recent, helped to limit the spread of COVID-19 in California prisons during the first Omicron wave, according to an analysis by ...

Study identifies potential new approach for treati…

Targeting iron metabolism in immune system cells may offer a new approach for treating systemic lupus erythematosus (SLE) - the most common form of the chronic autoimmune...

Nanotechnology may improve gene therapy for blindn…

Using nanotechnology that enabled mRNA-based COVID-19 vaccines, a new approach to gene therapy may improve how physicians treat inherited forms of blindness. A collabo...

Acquisition of Neogene Therapeutics completed

AstraZeneca has completed the acquisition of Neogene Therapeutics Inc. (Neogene), a global clinical-stage biotechnology company pioneering the discovery, development and ...

Modified CRISPR-based enzymes improve the prospect…

Many genetic diseases are caused by diverse mutations spread across an entire gene, and designing genome editing approaches for each patient’s mutation would be impractic...

Pfizer expands 'An Accord for a Healthier World' p…

Pfizer Inc. (NYSE: PFE) announced that it has significantly expanded its commitment to An Accord for a Healthier World to offer the full portfolio of medicines and vaccin...