Understanding Consumer Choices
Young marketing faculty advance knowledge in this critical area
By Cyndy Falgout

n any given day, consumers make hundreds of choices about which products to buy, Internet sites to visit or charities to support. The ways consumers make decisions have important implications for marketers. The research and teaching of two rising stars in Kenan-Flagler's marketing department are making an impact on the knowledge about consumer decision-making.

Assistant professors Rebecca K. Ratner (left) and Gal Zauberman examine the ways consumers make decisions, which has important implications for marketers.

Assistant professors Rebecca K. Ratner and Gal Zauberman bring to the School strong expertise in psychology and experimental research. Both have published results in top scholarly journals and earn rave reviews in the classroom. Ratner's research has been cited in a popular new textbook for MBA marketing students, and she received the prestigious 2001 Weatherspoon Undergraduate Teaching Award after only three years in the classroom at Kenan-Flagler.

The marketing area at Kenan-Flagler is recognized as one of the best in the country. Ratner and Zauberman are part of a new group of young faculty members who are building on the strong reputation of a department of established scholars, said Marketing Area Chair and Professor Valarie Zeithaml.

"Rebecca and Gal are inquisitive and determined scholars whose imaginative and rigorous experimental approaches nicely complement the quantitative and survey approaches of our other faculty members," she said.

Ratner explores decision-making through a variety of research projects. "When consumers make choices that do not ultimately make them happy, I want to find out why," Ratner said. "If people realize that they react to public pressure or erroneous assumptions when they make choices, it may help them change their behavior and begin choosing items that they truly prefer."

Zauberman explores why people tend to make decisions without taking the time to search for potentially better options, even when searching is fairly easy, such as on the Internet. "I've always been fascinated with how we deal with so much information and are able to make decisions, often very quickly," he said. Classic research shows how people make decisions and how issues of cost, quality and relative return on investment affect them. "I'm interested in the more psychological drivers of this behavior."

Ratner, who has an undergraduate degree from Williams College and a master's from Princeton University, came to the consumer behavior arena from the field of social psychology. "I entered a PhD program at Princeton because I was interested in public health and how I could use social psychology to teach people to engage in healthy behaviors - not to drink and drive, to practice safe sex, to use seat belts," Ratner said. "I was interested early on in helping people by understanding the bad decisions they make and how to use psychology and our understanding of decision-making to help people make better choices.

"I study how people make choices between favorite items and those that are less preferred - why people choose an item that is less pleasing," she said. In fact, people often choose or switch to a less-preferred item and do so more frequently when they are in public. Preliminary findings suggest that consumers often feel pressured to choose items in public so they will appear more interesting to others, or they make the decisions they think other members of their group would want them to make. Ratner's research suggests that consumers believe choosing a less-preferred item will enhance their enjoyment of a preferred item later. In fact, it does not, Ratner said.

Ratner also researches the impact of consumer self-interest on decision-making. Since 1993, she has studied whether consumers in cultures that value individualism feel pressured to make self-interested decisions. For instance, do men feel reluctant to enter the abortion debate or support breast cancer if they don't have a direct self-interest, such as someone in their lives directly affected by these issues? And if so, why? Evidence suggests they do feel reluctant, Ratner said. One reason might be that they feel their opinions or contributions will be valued less if they do not have a clear personal stake or connection. This research on self-interest has great implications for people involved in marketing or promoting social causes.

Zauberman focuses his research on the choices consumers make over time, an area known as "intertemporal choice." A native of Israel, he came to marketing from the field of psychology, receiving undergraduate degrees from UNC-Chapel Hill. His PhD in marketing from Duke University focuses on consumer decision-making. Zauberman's latest work shows that people's evaluations of their consumer experiences are significantly altered if those experiences are a part of a series. His findings also show that consumer perceptions are, in large measure, determined by the sequence of their experiences.

Imagine a consumer who goes to a store to buy a computer and encounters a salesperson who is unfriendly and unhelpful. If, during that visit, another salesperson steps in and helps the consumer find exactly what he or she needs, the consumer likely will be left with an overall favorable impression of that store, Zauberman said. Imagine then that the consumer returns to the store multiple times to buy additional items. If these visits over time are perceived by the consumer to be separate experiences, then that shopper's overall opinion of the retailer will depend less on each individual experience and more on the collective experience, Zauberman said.

Ratner's and Zauberman's findings will help researchers in the future understand the choices consumers make as new technologies are introduced.

In the classroom, Ratner and Zauberman share with marketing students not only tried-and-true tenets of marketing practice but emerging academic theories as well. Ratner helped establish an undergraduate research pool through which all students enrolled in the "Principles of Marketing" course critique a journal article or participate in research.

"We bring in cutting-edge knowledge, discuss it with students, critique it, see how we can apply it, and discuss how it might change conventional knowledge," said Zauberman.

Said Ratner: "By engaging students in research, we expand their knowledge and understanding of marketing research and experimental methodology while they help us pursue important research agendas."

For more information, contact Ratner at (919) 962-8215, , and Zauberman at (919) 962-3284, .