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August 30, 2004
Value added

By Eric Rangus

Jagdish Sheth would have found success no matter what he chose to do—that’s pretty easy to see. But his career path, the one led him to be one of the most innovative and accomplished marketing minds on the planet, can be traced to a simple classroom give-and-take while Sheth was an MBA student at the University of Pittsburgh in the early 1960s.

Professor John Howard was discussing a recent study by Dupont, which found that 40 percent of housewives went to the store without shopping lists. This meant that 60 percent of shoppers were impulse buyers, he said.

Sheth was uncomfortable with the conclusion. The only foreign-born student in the program (Sheth is of Indian origin), he was even more uncomfortable with questioning a professor, a discipline Sheth was raised to treat with the utmost respect.

Still, Sheth raised his hand and asked, “Does that mean that everyone in illiterate countries is an impulse buyer?” After all, a woman who couldn’t write certainly couldn’t compile a shopping list.

Howard, surprised that he had never considered such a viewpoint, was silent for about 20 seconds. After the long pause, he replied, “That’s a good question.”

Howard remembered the exchange. And when he was looking for a graduate student to help him with some new research, he thought of Sheth. Seeing that the thoughtful 23-year-old could offer a worldview he lacked, Howard offered him a job. For much of the decade they worked on a marketing theory that focused on consumers rather than sellers, why consumers buy what they do—an approach that had never previously been tried. In 1969, the results of that work were published in a book, The Theory of Buyer Behavior, and the discipline of consumer research was born.

“It was a radical theory,” said Sheth, Charles H. Kellstadt Professor of Marketing in the Goizueta Business School. He came to Emory in 1991 following an already distinguished career at the universities of Southern California and Illinois, Columbia and the Massachusetts Institute of Technology.

“In all [previous] economics and demand theories, the notion was that consumers make rational choices,” he said. “Our theory was, through experience and learning, consumers actually reduce choice to simplify their lives. They become loyal to a brand, for instance.”

All of this is basic marketing now, but before Howard and Sheth published their book, the area had never been explored. It’s practically impossible to overstate the significance of Buyer Behavior.

Sheth didn’t peak early. In all, he has written more than 200 books and research papers on marketing. He is a consultant to several companies and even governments (he has worked with the government in Singapore almost 20 years and earlier this month was in Turkey meeting with that country’s top economic ministers).

While he has earned many awards, perhaps the most meaningful came this past June when Sheth was presented with the American Marketing Association’s Distinguished Marketing Educator Award, the highest honor in his discipline. The fact that the recipient is selected by his peers only makes the honor more meaningful.

“What’s good about this recognition is not the satisfaction of the person who gets the award,” Sheth said. “But that you become a role model for others; that drives me. It’s what I enjoy—that I can be a role model for other ethnic people in this country who come from all over the world.”

Being a role model and giving back to his community have always been important to Sheth. The Madhuri and Jagdish Sheth Foundation was created in 1991 at Illinois (where Sheth taught for 15 years and the alma mater of both his children—his oldest, Reshma Shah, is an assistant professor of marketing at Goizueta). At Emory three years ago he established the Sheth Distinguished Alumni Award, which recognizes international alumni who have distinguished themselves in service. He also funds the Sheth Lecture on Indian Studies, which brings a scholar on South Asia to Emory for a campuswide address as well as visit to a graduate class.

Earlier this year, Sheth and Madhu, as she is known to her family and friends, pledged $50,000 to create Emeritus College’s Sheth Distinguished Lecture. The first speaker was President Emeritus Jim Laney, the man who hired Sheth.

“I’ve always felt it important to give back to the academy that nurtures you,” Sheth said. “Every institution has been good to me.”

Sheth’s successes as an adult, and his appreciation for them, are perhaps magnified by the struggle of his youth. He was born in Burma (now Myanmar) in 1938, the youngest of six children. He was just a toddler when his family fled the country in the winter of 1941, just ahead of the invading Japanese at the start of World War II. Immigrants from western India, Sheth’s father had moved the family to suburban Rangoon for his business as a rice trader. In the escape back to India, the family lost everything. During the war, Sheth’s mother sold jewelry she inherited from her parents, and his three sisters did embroidery and baked bread to
make ends meet.

After the war, the family got back on its feet. Sheth’s oldest brother, Himatlal, opened a shop in which he sold jewelry boxes. Second brother Gulab Chand became a teacher and eventually joined Mahatma Gandhi’s Indian independence movement.

“My two brothers were heavily influential on me, but in different ways,” Sheth said. He inherited his business sense from Himatlal, 16 years older. Sheth’s academic leanings came from Gulab Chand, 14 years older. And that combination of influences would guide Sheth for many years.

An excellent student whose initial goal was to be an accountant, Sheth came to the United States at Himatlal’s urging. The goal was to earn an MBA, then return home to help with the family business. That’s not exactly what happened. Sheth became fascinated with the psychological research that accompanied his and Howard’s work on buyer behavior. He decided to pursue a doctorate and joined Howard at Columbia when the professor moved there in 1963.

“I was in the stacks 10 hours a day, six days a week,” Sheth said of his research, which he literally dove into.
“I still have the smell of those stacks. I loved it, soaking up all the knowledge of social science.”

While Sheth’s family was initially disappointed with his decision to stay in this country, they eventually supported it. There was one complication, though: Sheth was to be married upon his return.

Sheth met Madhu, a teacher, in a literature group back home in Madras (now Chennai), where the family had settled. When he decided to stay in the United States, he asked her to marry him in this country. He couldn’t afford to bring her over, so he borrowed $1,000 from the University of Pittsburgh (although he moved to Columbia, he kept his affiliation with the school and received his Ph.D. in 1966); his salary as Howard’s graduate student covered the rest, and the Sheths were married in the Heinz Cathedral in Pittsburgh.

Sheth’s work ethic is tremendous and consistent throughout his academic career, and he hasn’t stopped producing leading-edge scholarship. His two latest books, 2000’s Clients for Life and 2002’s The Rule of Three, were both well received.

Sheth is working on three books, all with co-writers, at various stages of development. One of them, which explores the geopolitical realignment of the world based on economics (NAFTA and the European Union are examples Sheth cites), posits the theory that regionalization will be more of a defining force than globalization. That one is almost finished, and Sheth is searching for a publisher.

A book Sheth currently is writing defines a new framework of marketing called the “Four As.” They are: acceptability, affordability, accessibility and awareness. “The first three are easy,” Sheth said. “Customers always want a more acceptable product at a more affordable price in a more accessible way. So if you offer that, you always win the market. It’s a no-brainer.

“We added awareness, because even though you have done all these things right, you still have to promote yourself,” he continued. “You have to make people aware that you exist.” That work is about six months from completion.

Sheth’s third book, which is about 18 months from wrapping, is an exploration for companies that are successful from a customer viewpoint. They are usually from small towns and family run he said. “They create value for everybody. Employees are happy, customers are happy and the shareholders are happy.” The book’s working title is a happy one as well: Firms of Endearment.

Sheth does all of this writing on top of his teaching and mentoring of students. More than 20 of his doctoral students are world-class scholars themselves.

“I enjoy motivating young people,” he said. “I like to say if you take a grain of wheat and make a loaf of bread, the value added is 20 times. If you take a rough diamond, polish it and make it into a finished diamond, the value added is 40 to 60 times. If you take a human being and nurture and invest in that human being, the value added is infinite.”

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