Areas of Expertise (8)
Raghunath Rao is an Associate Professor at the McCombs School of Business. His research interests span a variety of marketing topics such as pricing, incentives, behavioral decision theory, sales management and innovation, and marketing models, often in the context of durable goods markets. His research is consistently published in the leading journals of his field, like the Journal of Marketing Research, Marketing Science, and the Journal of Marketing.
University of Minnesota, Minneapolis: Ph.D., Business Administration 2007
University of Minnesota, Minneapolis: M.S., Applied Economics
Indian Institute of Foreign Trade (New Dehli, India): M.B.A., International Business
National Institute of Technology (Surat, India): B.Eng., Electrical Engineering
List of top scholarly works by Raghunath Singh Rao.
Internet retailers often compete fiercely for consumers through expensive marketing efforts like search engine advertising, online coupons and a variety of special deals. Against this background, it is somewhat puzzling that many online retailers have recently begun referring their website visitors to their direct competitors. In this paper, using an analytical model, we examine this counterintuitive practice and posit that an entry deterrence motive can potentially explain this marketplace puzzle.
Sellers are often more interested in inducing buyers to make a choice—any choice—than in influencing which option they choose. For example, many retailers are more concerned about maximizing customer purchases within categories than influencing which brand is purchased in any particular category. ...Research on how contextual factors, such as decoys and prior decisions, affect whether consumers will “choose to choose” is scarce. We propose a reference-dependent model to fill this gap.
How do firms develop marketing strategy when consumers seek to satisfy both quality and status-related considerations? We develop an analytical model to study this issue, examining both pricing and product management decisions in markets for conspicuous durable goods.
Quota-based bonuses and commissions are the two most common incentive compensation plans. In this award-winning paper, the authors uncover differential effects of these plans from a natural field-based experiment of a pharmaceutical firm that switched from a bonus plan to an equivalent commission plan. The intervention led to significant sales productivity improvement. [Winner of the 2014 AMA Sales SIG Excellence in Research Award for Best paper on Sales Management]
When consumers trade in their used model for a new model, the firm faces the choice of paying the consumer a relatively low price for the used model and charging a commensurately low price for the new model or paying a relatively high price for the used model and charging a commensurately high price for the new model. The authors draw from the prospect theory value function to develop a simple analytical model...
Prior research on relative thinking has suggested that the willingness to seek a bargain depends not only on the absolute value of the bargain but also on the price of the product. For example, a discount of $10 seems more appealing on a product whose regular price is $20 than a product whose regular price is $60. By invoking the interactive role of consumers' reference prices, the authors delineate the specific conditions under which the same $10 discount can seem less appealing when the price is $20 than when it is $60.
The act of trading in a used car as partial payment for a new car resonates with practically all consumers. Such transactions are prevalent in many other durable goods markets, ranging from golf clubs to CT scanners. What roles do trade-ins play in these markets?...
This article examines rewards to product introduction by new ventures. The authors argue that the new ventures that gain the most from innovation are those that adopt strategies that give them legitimacy in the eyes of stakeholders.