June 25, 2009

What About All the Irrational Stuff?

Almost thirty years ago, Morris Holbrook and his colleagues stirred up a sea change in consumer research, tabling the old rationalist model and exploring the emotional side of consumer behavior.

Topics: Marketing

How did you land at the School?

I started at the School in 1965 as an MBA student and stayed on to complete my PhD. John Howard and Jagdish Sheth, both members of the faculty then, wrote a monumental book in the field called The Theory of Buyer Behavior, which was among the first works that systemized our understanding of consumer choices, identifying the decision-making process and observing its changes over time.

I was lucky enough to be an MBA student in John’s class when he was working on the book. He would come in and pass out mimeographed copies of his latest chapter. Our homework assignment was to read and critique it. And I was really fascinated by this stuff. So I got to be friendly with him, and he became a kind of mentor and eventually became my sponsor in the PhD program.

What are the most significant shifts in marketing research you’ve seen over the course of your career?

The advent of buyer behavior theory itself was a huge watershed, part of the recognition that you had to look at the customer. Before that you might study retailing or salesmanship. The buyer-behavior work was a significant development. But then again, I started my study at the same time so it has always existed for me.

But even as buyer-behavior theory did represent the elevation of the customer, at the time everything was much more quantitative. Researchers believed, for example, that consumers absorbed and processed brands and advertising campaigns at face value, as if the consumer’s personal experiences and opinions didn’t inform and alter his or her responses and reactions.

The role of emotions in the decision-making process had been explored in the 1940s and 1950s but was subsequently abandoned. Then in the 1980s a bunch of us wondered, wait a minute, what about all the irrational stuff, the daydreams, the emotions, fantasies, biases and misperceptions? My colleague Beth Hirschman (now at Rutgers) and I lumped it together under the heading of the consumption experience in general and fantasies, feelings and fun in particular.

We didn’t realize it at the time — though we now realize it very forcefully — but the consumption experience was not a new idea. We thought we’d invented this great new idea! But it goes way back. We traced it to Adam Smith. Marshall and Keynes talked about it, as did others. So we just rediscovered the wheel.

But we — and many others — did proceed to make a big deal about these hedonic aspects of consumer behavior. It gained momentum and people assimilated it into their thinking. Now a new group of people are writing about experiential marketing, including our own Bernd Schmitt.

It’s hard to conceive of a time when the importance of psychology and emotion in consumer behavior — in economic behavior — wasn’t recognized. How is it that something so significant was abandoned early on?

In the 1940s and 1950s marketing research was steeped in qualitative assessment, and a lot of the researchers were trained in psychoanalysis. They referred to their work as motivation research — figuring out the underlying, deep, dark and repressed needs and wants of consumers. But there was a backlash because many people viewed their methods as unethical and unscientific. So motivation research, with its psychoanalytic and interpretive foundation, was abandoned.

By the time I came to the School, research was pretty firmly entrenched in the quantitative approach; everyone used big surveys that included lots of numbers and data. I had a humanities background and had read a lot of Freud and I thought some of that stuff was pretty cool. So when I first started talking to John Howard, I tried to engage him by asking if he didn’t think there might be some important stuff going on under the surface — hidden motivations, repressed desires. He was pretty appalled at the suggestion. He couldn’t entertain the idea that consumers were anything but rational economic creatures who maximized utility and weighed pros and cons and made rational decisions and were logically consistent and motivated by getting the best value for their money.

John’s view was typical for the day. Between 1965 and 1980 every consumer-behavior study done was essentially based on a rational economic model.

Is the rationalist model really so limiting?

The rationalist model makes a lot of assumptions about the way consumers process information, to the point of overlooking feelings, hedonic responses and aesthetic appreciation. A researcher can ask a consumer to name the attributes he or she cares most about in a car. And that consumer can say, “good mileage per gallon, lots of space in the trunk, rapid acceleration,” and so on. All of those data can be put into a model, and the consumer’s perception can be measured based on how important each of these attributes is to him or her. Up to a certain point this can help researchers explain a consumer’s preferences, but so much is left out.

Consumers’ emotional connection to the consumption experience, for example, weighs heavily on their preferences and the way they process information. Consumers aren’t totally irrational, of course, but social values — how they use the brand to relate to friends and family, what impression they make on others based on the brands they wear — are significant contributing factors to how and why they make decisions. There are also aesthetic concerns — does it smell good, is it beautiful? There are altruistic and ethical concerns — was any person exploited to produce this product, does purchasing this product help anyone?

Quantitative research is useful for exploring someone’s preference in (say) shampoo, insofar as money and ingredients are concerned, but not for understanding how it makes an individual feel – young, sexy, energized. A marketer cannot use quantitative methods to explain someone’s decision to go to a New York Philharmonic concert or the Metropolitan Museum of Art.

What else, if anything, has changed during your tenure here?

I’ve always used a lot of aggregate data; instead of looking at individuals I often look at the average behavior of a group of people. Human subjects review has complicated matters in recent years. I often don’t know the exact direction of much of my research until it’s underway, and it can be difficult to get timely approval to use human subjects.

But the Internet has compensated for that to some degree. There are vast amounts of public and nonsensitive data that are pretty accessible. [You can read about one such study in this Ideas at Work story.] That has allowed me to shift the direction of my research along the way, as is necessary, and to collect aggregate data on patterns and trends with relative ease.

I find a lot of the decision-making studies in behavioral economics and the new brain research work that is coming out fascinating. Some of that work does things like using brain scans and monitoring blood flow — it’s still pretty new. I’ll be interested to see how it evolves.

What’s next for you now that you are retiring?

I have a few projects I’m still working on but I hope to wrap those up soon. I would like to travel with my wife, Sally. I’ve got some interest in photography. I’ve got a novel in progress that I’d like to finish. I play the piano and the vibraphone; I might not be playing a concert at Carnegie Hall any time soon, but I certainly hope to get back into playing more often. And I’ve done a lot of research in music — if I can find the time I’d like to explore the real nuts and bolts of music theory, especially in jazz.

Morris Holbrook is the William T. Dillard Professor of Marketing at the Columbia Business School. He retires this year after teaching and conducting research at the School since joining the faculty in 1975. A Fellow of the Association for Consumer Research, he is the recipient of a Distinguished Scholar Award from the Society for Marketing Advances and a Carol and Bruce Mallen Prize for contributions to the Motion Picture Industry.

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