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Using Cash as a Weight Loss Incentive
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Using Cash as a Weight Loss Incentive

Sites like HealthyWage, DietBet and stickK offer variations of wagering money against achieving a certain goal.

Finding the motivation to achieve weight loss goals can be challenging. There are many different diet and exercise options available, but the stresses of modern life can often lead us to abandon our healthy intentions in favor of convenience.

But what if there was a more successful—and manipulative—form of self-persuasion?

Emerging research points to the effectiveness of behavioral economics: a relatively new area of study that examines the relationship between human psychology and economics.

Recently, academics have honed in on the idea that taking advantage of human aversion to harm could, in fact, be an effective way of encouraging weight loss.

The Introduction of Weight Loss Wagers

In 2008, researchers from Harvard University and the University of Pennsylvania published a study in the Journal of the American Medical Association (JAMA) that established a link between financial incentives and significant weight loss.

Over the course of a 16-week trial, dieters between the ages of 30 and 70 were separated into three groups with different weight loss plans.  One group was subjected to monthly weigh-ins; another group participated in a lottery incentive program; and the last group was offered a deposit contract that allowed for participant matching, with a weight loss goal of 1 pound a week for 16 weeks.

Dieters that received a financial incentive lost up to three times more weight than those who had no financial incentive, and were five times more likely to achieve their weight loss goal.

However, while the researchers concluded that financial incentives appeared to be highly effective in inducing initial weight loss, it was not fully sustained over the time frame.  Further research was recommended into the longer-term use of incentives.

David Roddenberry is the co-founder of HealthyWage, a website that encourages applicants to make a wager on a weight loss target, with the incentive of winning money.

Roddenberry credits the JAMA study as the inspiration behind HealthyWage, and says the research motivated him to figure out a way to commercialize the findings.

“I thought it was an interesting concept, but commercializing it seemed like a really complex question—like, how much money do you need to pay people and how often, does it matter if it’s cash or gift cards—there are so many questions in the approach, and so I thought it was an area ripe for exploration,” Roddenberry says.

The premise of HealthyWage, in Roddenberry’s words, is grounded in “the latest thinking in science and behavioral economics,” and aims to encourage people to make healthier decisions.

“We are not rational about our weight. A lot of us know what we need to do—eat less and move more—but we don’t do it.  And so we have designed programs to exploit our decision-making biases to help us make better decisions and hence the effectiveness of our fitness and diet strategies,” Roddenberry says.

Since HealthyWage was founded in 2009, Roddenberry says over 100,000 people have used the program, and “almost everybody who participated lost weight.”

According to Roddenberry, HealthyWage participants typically make 150 percent of their return, meaning that they “roughly double-and-a-half” their money.

“I think you need fresh approaches to drive engagement in weight loss, and we’ve been fortunate in that respect,” he says.

Other websites that use financial incentives for weight loss include DietBet and stickK, which offer variations of wagering money against achieving a certain goal.

A recent Forbes article profiled stickK, a website that threatens participants with the loss of their own money unless they meet their pledged goals.

StickK was founded by a group of Yale University academics, who believe that behavioral economics can act as an effective way to motivate people into meeting their goals, and not just for weight loss—participants can place a wager for any kind of commitment.

“A Commitment Contract is a binding agreement you sign with yourself to ensure that you follow through with your intentions—and it does this by utilizing the psychological power of loss aversion and accountability to drive behavior change,” the description on the stickK website reads.

“By asking our users to sign Commitment Contracts, stickK helps users define their goal (whatever it may be), acknowledge what it’ll take to accomplish it, and leverage the power of putting money on the line to turn that goal into a reality.”

The Challenge of Ongoing Weight Loss

The Mayo Clinic, a nonprofit medical research center, published its own study on the relationship between financial incentives and weight loss in 2013.  Mayo Clinic researchers found that weight loss participants who received financial incentives were more likely to adhere to a weight loss program and lose more weight than those that received no incentives at all.

The study examined a group of 100 people between the ages of 18 and 63. The participants were healthy Mayo Clinic employees or their dependents, with a body mass index of 30 to 39.9.

Participants were separated into four different groups and given the goal of losing four pounds per month over the course of one year.  Those who met the requirements received payments of $20 per month, while those who failed to meet their goals paid a penalty fee of $20 into a larger bonus pool that was later awarded via lottery among participants who completed the study.

The Mayo Clinic study found that while financial incentives could achieve weight loss, sustainable weight loss was more likely to be achieved with a program designed for long-term delivery of incentives.

In short, the researchers believed that participants needed ongoing financial rewards, in order to continue losing or keep off weight.

Dr. Edward Abramson is a clinical psychologist and professor emeritus of psychology at California State University. He says that extrinsic motivations like cash are not necessary a good motivator for the long term.

“It’s likely that there will be a relapse once the external benefit is withdrawn,” Abramson says.

“An intrinsic motivation is preferable, i.e., you are losing weight because you like the way you feel, like the health benefits, like the way you look.  It’s more likely that the weight loss behaviors will be maintained over the long term.”

Both JAMA and Mayo Clinic researchers concluded that financial incentives were effective for kick-starting weight loss and achieving short-term goals, but it remained unclear whether sustainable, long-term weight maintenance was possible.

Roddenberry admits that tracking long-term behavioral change is difficult, which is why HealthyWage has a few different ways of doing this, such as encouraging people to sign up for longer periods, or checking up with participants in team challenges and awarding extra prizes for long-term maintenance.

Of the people who sign up with HealthyWage, Roddenberry estimates that about 30 percent  of participants end up making a longer-term lifestyle change.

Abramson is also concerned that linking weight loss to financial gain could lead to unhealthy behaviors.

“If there is a deadline for earning the financial benefits it could lead to unhealthy behaviors.  For example, if you could earn $100 by losing 10 pounds by Friday, you might be tempted to purge on Thursday night to meet the deadline,” Abramson says.

The Gambling Link

So how are these websites different to gambling?

In the United States, the definition of gambling involves staking something of value upon the outcome of a contest of chance or a future contingent event outside of a person’s control or influence.

Websites like HealthyWage, DietBet and stickK are all adamant that their programs on offer do not meet this definition, and therefore do not fall into the same category as gambling.

The DietBet website addresses the issue directly and says, “There is no luck involved in whether you win and your weight is entirely under your control (hard as that may be to believe sometimes).  It is the textbook definition of a skill-based contest.”

Likewise, Roddenberry says that HealthyWage has carefully constructed its programs to comply with gaming laws, thereby eliminating any element of chance.

“It’s more akin to a contract, where I say to you: if you mow my yard, I will pay you $150.  It’s the same kind of concept where you agree to do something and I agree to pay you for doing it,” Roddenberry says.

StickK refers to itself as a “goal-setting platform” and calls the wagers by participants a “commitment contract”.

Though it may be a question of semantics, it appears that these companies are legally in the clear, and are creating some noise in the world of weight loss.

Whether they will continue to enjoy success will largely depend on the long-term viability of their programs.