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STANFORD GRADUATE SCHOOL OF BUSINESS — Researchers and marketers have long assumed that consumer decision making tends to be easily swayed and not terribly reliable. A new study coming out of the Stanford Graduate School of Business, however, suggests that many consumer judgments may be far more stable than previously thought –– in fact, they may be genetically determined.

 Specifically, investigators have found that some people may be born with a tendency to “be in the mainstream,” whereas others tend to “live on the edge.” Such leanings have important implications for people’s consumer preferences.

 According to Professor Itamar Simonson, people seem to be genetically geared either to make compromises or take more “extreme” options, select sure gains or take gambles, prefer easy but non-rewarding tasks or pursue challenging but more rewarding ones, and chose utilitarian items or hedonistic ones. “We propose these findings might reflect general heritable differences relating to ‘prudence,’” says Simonson, Sebastian S. Kresge Professor of Marketing, who coauthored the study with Aner Sela (PhD ’10, an assistant professor of marketing at the University of Florida.

 The researchers also found that people seem genetically hardwired to have a liking for specific products such as chocolate, mustard, and hybrid cars, as well as musical forms such as jazz or opera, and even science fiction movies. Interestingly, they were not able to determine genetic influence on a host of other behaviors, such as the tendency to choose attractive over unattractive items, and to prefer larger rewards later versus smaller rewards sooner.

 Simonson and Sela came to such conclusions by subjecting identical and fraternal twins to a battery of questionnaires to study their choices and judgments on various matters. A greater similarity in behavior or trait between identical than between fraternal twins indicates that the phenomenon in question is likely to be inherited.

 The work emerges out of Simonson’s research over the past 24 years, which has been focused on figuring out what makes consumers tick. In the mid-1990s, he concluded that buyers often have no preferences at all, that their decisions are unstable and depend on various seemingly illogical influences, and that companies could, but should not, use this knowledge to enhance sales. Subsequently “realizing researchers might have exaggerated the degree to which consumer decision making is irrational,” he says, he turned his attention to studying ways in which consumers reveal themselves; in fact, to have inherent, stable preferences, “even if they’re not always clear.”

 This latest study, which will be published in the Journal of Consumer Research in April, represents a further move in the direction of establishing just how influential inherent preferences may be in governing behavior. Despite the fact that research on heritable traits and behaviors goes back to the 19th century, this is the first study to investigate how genetics can affect consumer choices.

 Simonson himself issues a few cautions about his research. “People are not born with a Prius gene, a compromise gene, or a jazz gene,” he notes. “Instead, these tendencies probably reflect a yet unknown combination of genetics, and gene expression characteristics, which, in turn, are influenced by an interaction between nature (genes) and nurture (environment).”

 The study nevertheless implies that understanding the genetic component may lead companies to consider how specific new products and technologies could have a better chance of being well-received by particular genetic segments. “For example,” Simonson says, “genetic research could potentially reveal that a videogame that uses a motion-sensitive remote is likely to benefit from certain genetic predispositions, perhaps even suggesting the most promising target consumer segments.” Furthermore, future research might provide insights as to heritable traits that might make people more likely to prefer certain brands or respond favorably to particular types of advertisements.

 Investigations in this area will have obvious limitations in terms of the kinds of firm claims it can make until more scientific genetic research catches up, admits Simonson. “However,” he says, “it would be a mistake to continue our neglect of the role of genetics and heritability in judgment and choice, given that there is little doubt that such effects represent a major influence that deserves a great deal more attention.”

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Also on Stanford Knowledgebase:

  1. The Downside of Conducting Consumer Surveys
  2. How Dividends Encourage Consumer Spending
  3. Consumer Boycotts Work—Just Ask French Winemakers

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