Knowledge that Transforms

Many consumer promotions involve uncertainty (e.g., purchase incentives offering the chance to receive one of several rewards). Despite retailers’ heavy reliance on such promotions, much academic research on uncertainty has demonstrated examples of consumers avoiding and/or disliking uncertainty, implying that promotions involving uncertainty may not be as effective for retailers as promotions offering certain rewards. In an effort to reconcile the prevalence of uncertain promotions with the existing research, this article explores the conditions under which uncertain promotions may be effective for retailers. The article concludes with a discussion of the theoretical and practical implications for these findings.

Socially desirable responding (SDR) has been of long-standing interest to the field of marketing. Unfortunately, the construct has not always been well understood by marketing researchers. The authors provide a review of the SDR literature organized around three key issues—the conceptualization and measurement of SDR; the nomological constellation of personality traits, values, sociodemographics, and cultural factors associated with SDR; and the vexing issue of substance versus style in SDR measures. The authors review the current “state of the literature,” identify unresolved issues, and provide new empirical evidence to assess the generalizability of existing knowledge, which is disproportionately based on U.S. student samples, to a global context. The new evidence is derived from a large international data set involving 12,424 respondents in 26 countries on four continents.

Endogeneity arises for numerous reasons in models of consumer choice. It leads to inconsistency with standard estimation methods that maintain independence between the model's error and the included variables. The authors describe a control function approach for handling endogeneity in choice models. Observed variables and economic theory are used to derive controls for the dependence between the endogenous variable and the demand error. The theory points to the relationships that contain information on the unobserved demand factor, such as the pricing equation and the advertising equation. The authors’ approach is an alternative to Berry, Levinsohn, and Pakes's (1995) product-market controls for unobserved quality. The authors apply both methods to examine households’ choices among television options, including basic and premium cable packages, in which unobserved attributes, such as quality of programming, are expected to be correlated with price. Without correcting for endogeneity, aggregate demand is estimated to be upward-sloping, suggesting that omitted attributes are positively correlated with demand. Both the control function method and the product-market controls method produce downward-sloping demand estimates that are similar.

Social commerce is an emerging trend in which sellers are connected in online social networks and sellers are individuals instead of firms. This article examines the economic value implications of a social network between sellers in a large online social commerce marketplace. In this marketplace, each seller creates his or her own shop, and network ties between sellers are directed hyperlinks between their shops. Three questions are addressed: (1) Does allowing sellers to connect to each other create value (i.e., increase sales)? (2) What are the mechanisms through which this value is created? and (3) How is this value distributed across sellers in the network and how does the position of a seller in the network (e.g., its centrality) influence how much he or she benefits or suffers from the network? The authors find that (1) allowing sellers to connect generates considerable economic value, (2) the network's value lies primarily in making shops more accessible to customers browsing the marketplace (the network creates a “virtual shopping mall”), and (3) the sellers who benefit the most from the network are not necessarily those who are central to the network but rather those whose accessibility is most enhanced by the network.

Five studies examine how the two distinct emotional states of shame and guilt influence the effectiveness of messages that highlight socially undesirable consequences of alcohol consumption. Appeals that frame others as observing versus suffering the negative consequences of binge drinking differentially activate shame and guilt. Given these emotional consequences of message framing, the authors examine the interaction between incidental shame or guilt and message framing on drinking intentions and behavior. Compatible appeals (i.e., appeals that elicit the same emotion as being incidentally experienced by the consumer) are less effective in influencing behavioral intentions and beverage consumption because of a process in which consumers discount the notion that they may cause the negative consequences outlined in the message. Such defensive processing of compatible messages is driven by a desire to reduce the existing negative emotion.

This research develops a taxonomy of alphanumeric brand names (ABs) based on the alignment between the brand names and their links to products and attributes. Five empirical studies reveal that ABs have systematic effects on consumers’ product choices, moderated by consumers’ need for cognition, the availability of product attribute information, and the taxonomic category of the AB. In an identical choice set, the choice share of a product option whose brand name takes a higher versus lower numeric portion (e.g., X-200 versus X-100) increases, and it is preferred more even when it is objectively inferior to other choice alternatives. Consumers with low need for cognition use “the higher, the better” heuristic to select options labeled with ABs and choose brands with higher numeric portions. Consumers with high need for cognition process ABs more systematically and make inferences about attribute values based on brand name–attribute correlations. The effects of ABs on consumer preferences are prevalent for most technical products, even when consumers do not know the product category or meanings of attributes.

Recent research challenges the idea that greater choice is always desirable, showing that larger assortments can increase choice deferral and switching. The current research demonstrates that even when consumers make a purchase, the same item may generate lower satisfaction when chosen from a larger rather than a smaller assortment. The authors explain this effect in terms of an expectation-disconfirmation mechanism. When assortments are small, consumers have low expectations about their ability to match their preferences. As assortment sizes increase, so do consumers’ expectations of the degree of preference match they can achieve. Subsequently, consumers may experience greater negative expectation disconfirmation or less positive expectation disconfirmation when a chosen item comes from a larger rather than a smaller set. Either less positive or more negative disconfirmation leads to lower choice satisfaction. The results from three studies support this expectation-based process and establish this mechanism in addition to alternative explanations, such as choice overload.

The authors propose that power distance belief (PDB) (i.e., accepting and expecting power disparity) influences impulsive buying beyond other related cultural dimensions, such as individualism–collectivism. This research supports an associative account that links PDB and impulsive buying as a manifestation of self-control, such that those with high PDB display less impulsive buying. Furthermore, this effect manifests for vice products but not for virtue products. The authors also find that restraint from temptations can occur automatically for people who have repeated practice (i.e., chronically high PDBs). Taken together, these results imply that products should be differentially positioned as vice or virtue products in accordance with consumers’ PDBs.

More than 200 studies suggest that metacognitive difficulty reduces the liking of an object. In contrast to those findings, the authors demonstrate that the effects of metacognitive experiences on evaluation are sensitive to the consumption domain. In the domain of everyday goods, metacognitive difficulty reduces the attractiveness of a product by making it appear unfamiliar. However, in the context of special-occasion products, for which consumers value exclusivity, metacognitive difficulty increases the attractiveness of a product by making it appear unique or uncommon. The authors reconcile their findings with prior research by positing that the effect of metacognitive experiences on evaluation depends on the naive theory people associate with product consumption. Four studies demonstrate the proposed effect and test for the role of lay theories in the interpretation of metacognitive experiences. The authors conclude with a discussion of theoretical and marketing implications.

This research examines the psychosocial cost associated with positive word of mouth (WOM), which can decrease the uniqueness of possessions and thus harm high-uniqueness consumers (pilot study). As a result, high- (versus low-) uniqueness consumers are less willing to generate positive WOM for publicly consumed products that they own. However, high uniqueness does not decrease willingness to generate WOM for privately consumed products (Study 1). Study 2 demonstrates that for publicly consumed products, WOM that includes positive recommendations is more persuasive than WOM that only contains product details. Consequently, the effect of uniqueness is more pronounced for WOM recommendations than for WOM that only provides details (Study 3). Study 4 confirms that high- (versus low-) uniqueness consumers are less willing to recommend a public product to others but are equally willing to discuss product details. Study 5 analyzes real-world WOM content and finds evidence in support of these results.