The Impact of Firm Diversity on Consumer Behavior: When and Why Consumers Prefer Diverse versus Non-Diverse Firms

Faculty Development Competitive Research Grant Program (General) 2024-2026

As has been acknowledged by recent research (Khan & Kalra, 2022), there is a lack of research in how outsiders, who do not necessarily perceive themselves as a member of a given group, judge groups that differ in the level of diversity among group members. To explicate, past research on perceptions of groups has investigated either 1) judgments of an observer who identifies as a member of a given group or 2) group-level performance outcomes of given teams as a function of diversity. The marketplace interactions involve contexts in which consumers do not necessarily approach to firms or brands as out-groups; rather, they establish relationships with them, and they consider them as current or potential relationship partners (Alvarez & Fournier, 2016).
Note that the research plan we lay out this concern will address this important concern. More specifically, we will 1) include measures of respondents’ identities in all our studies and keep it as a covariate in our analyses, and 2) we will include studies where we will manipulate diversity while keeping group members constant. For example, we will ensure that respondents (e.g., all US Americans) do not perceive any of the group members as in-group members by manipulating diversity through dimensions like nationality (where all members of the group will have a national identity different from US American). This approach will allow us to disentangle the effects of personal identity and team diversity in shaping consumers’ responses.
The current project, which involves three distinct yet inter-related research questions, aims to address this critical gap in the literature. Each study focuses on elucidating different aspects of consumers' attitudes towards diverse firms, exploring the impact of diversity on consumers’ 1) judgments about firms, 2) cognition, and 3) regulatory focus.