Sunday, November 13, 2011
Priya Raghubir, Professor of Marketing, STERN School of Business, New York University
An Interview with Priya Raghubir
Professor of Marketing, STERN School of Business, New York University
In this month’s Vartalaap we feature Priya Raghubir. She is a Professor of Marketing at New York University, Stern School of Business. She was previously a Professor at Haas School of Business. She has taught undergraduate, M.B.A, Ph.D. and executive education courses in China, France, India and the U.S. Professor Raghubir received her undergraduate degree in Economics from St. Stephen's College, Delhi University; her M.B.A from the Indian Institute of Management, Ahmedabad; and her Ph.D. in Marketing from New York University. Professor Raghubir’s teaching interests are in the areas of marketing research, consumer behavior and marketing strategy, and her research interests are in the areas of consumer psychology, including survey methods, psychological aspects of prices and money; risk perceptions; and visual information processing.
Q1: How has the psychology of the Indian consumer changed over the decade? What are the key considerations for a marketer in the Indian context?
India is becoming increasingly like other consumer economies, such as the US and HK. The brand proliferation and high quality of products and other service options, along with the increase in disposable income have led to the Indian consumer having more choices than ever before, and being able to exercise them more discriminately.
Q2: What according to you is the most effective survey method? What key factors does a marketing research survey depend on?
Good research needs to be valid, reliable, and generalizable. That means, you need to ask the right question, get the right answer, from the right people. All methods of data collection: exploratory (such as focus groups and in-depth interviews), descriptive (such as surveys and observations), and causal (such as conjoint experiments) have different strengths and weaknesses. While the first method can give you depth of understanding, the second may better allow you to generalize, and the last is the best for determining causality of the if-then type. Thus, it depends on the state of knowledge of the researcher and the business problem which method would be most appropriate.
Q3: Do you feel that the 4P approach to marketing is out-dated in the world today?
I believe that there is time for the 5th P – Planet, to add to our four Ps!
Q4: What according to you creates a successful marketing strategy?
The four C’s: Three of which one knows – Company, Competition, and Customer, but increasingly, the 4th C of Community will allow for a sustainable strategic competitive advantage.
Q5: What, in your opinion, is the ideal career path for a marketing professional?
I think each individual must determine their own path. One size cannot (and should not) fit all.
Q6: Pricing is always one of the most important decisions to be taken, be it for a first mover or a follower in the market. What would you say are the key aspects to be considered in pricing?
I believe the psychological considerations of pricing are under-looked in price setting. These include the perceptions of prices, the inferences drawn from them, the affect (feelings and emotions they induce), and the manner in which they are integrated with other information to make a judgment.
Q7: With expertise in the field of marketing research and consumer psychology, what according to you are some of the psychological biases in pricing and packaging?
That is a really difficult question because you are asking me to summarize two decades of two streams of my research into a few sentences! But if I had to, here is what I would say: I believe the underlying reason for most biases is due to effort-accuracy trade-offs. Said differently, most of the time a simple heuristic does work just fine for a consumer who really does not wish to maximize accuracy, just satisfice it. One of the heuristics, though that are seemingly so simple to use, and can lead to big biases in behaviour without a consumer realising their biasing effects is the “Anchor-and-Adjust” heuristic. As per this heuristic, you would anchor on one aspect of a stimuli due to its perceptual salience (e.g., height of a container in a packaging context, or foreign currency price), and inadequately adjust for the remaining dimensions required to make a judgment (e.g., width or breadth of the package, exchange rate of the currency in which the price was specified), and therefore make biased judgments.
Q8: From a student of marketing to the Mary C. Jacoby Faculty Fellow at New York University, what has been the most important learning for you?
Despite three masters degrees (the first of which is from your sister institute IIMA), I believe that my most important learning is to never ever compromise on my sleep. When I do I produce shoddy, second hand work! So: sleep well, eat well, and work will take care of itself.