25 Oct 2023

Behind the Research: Tomomichi Amano


by Shona Simkin

What does improv have to do with case method teaching? More than you might think. We talked with Tomomichi (Tomo) Amano, an assistant professor who teaches Marketing in the Required Curriculum and Innovation and Renovation in the Elective Curriculum, about his microeconomic research, how he got interested in it, and why he’s taking improv classes.

What is your area of research?
My interest is in using economic methods, along with customer and firm data, to understand how new products and innovations come to get widely used. There is a lot of talk about how to innovate, and how to innovate better. There’s a vague assumption that the more innovation we have the better, but that’s not the case because you need people to actually use the innovation. Plus, there might be disparities in the kinds of users who end up using and benefiting from the innovations. That’s where marketing is fascinating because it’s the interface between the firms and the consumers. Marketing is the key driver of how we get new products and it affects the product life cycle. It’s a topic I’m passionate about conveying to my students in my EC course—Innovation and Renovation—a course I’m so excited to teach.

What are you working on now?
I’m interested in the process by which innovations or new products become available to consumers, the disparities that arise, and how companies and policymakers respond to these dilemmas. For example, one of my first research projects looked at energy efficient TV sets—when governments set new efficiency standards, companies tend to respond by asking for looser restrictions and delaying the introduction of more efficient models. They’re concerned about even tighter restrictions once they’re released. I find that lower income consumers may actually benefit: they can purchase more affordable, albeit less energy efficient products, because the products are still allowed on the market. So, the existence of a policy ends up distorting firms’ incentives and has unintended consequences on the type of consumers who get to purchase the product.

I also study video games and in-game purchases—products that we worry might be getting used “too much” by some consumers. In many video games, the company sells you a lottery of sorts—if you want a sword in the game, you spend 99 cents for a chance to get the sword. The concern is that this popular lottery mechanism, called a loot box, may be exploiting consumers who are addicted to the game. There's a contentious debate in Washington and the EU about limiting such in-game purchases, or even banning them altogether. But these regulations not only kill the ability to make the purchase, but might also kill the ability to enjoy the game itself because users can’t get the items they enjoy. So, the regulation can distort the original value of the product itself, not just the in-game purchases that the regulator might be trying to regulate. This dynamic is affected by how the game was designed in the first place—if the sword was not of value in the game, this interaction would matter less. These are examples of how product design is not only affected by, but in and of itself affects, policy. These interactions matter because they influence who gets access to innovations, as well as how it gets used.

Recently I’ve been fascinated by the way products become available and what it means to the consumers who use them. Black consumers tend to purchase more menthol cigarettes, skin whitening creams, and douches—all products that are unhealthy, but still available at the drugstore. Why do these consumers systematically purchase products that we know to be harmful? A typical gut reaction is maybe there’s some information gap or an awareness story that will solve the problem—don’t use skin whitening creams because they contain mercury; if people know this, they’ll stop using it. But it turns out that this isn’t the whole story. The role of the brand is quite strong—people seem to be learning about brands from their parents, and ultimately purchasing the same brands as them. It suggests that an unintended consequence of very powerful marketing has been to generate brands that have been very effective at promoting consumption across multiple generations, even when the products are known to be harmful. Branding is powerful and persists, but at times causes disparities in product usage. Companies have an opportunity to get in front of these dynamics of policymaking and branding.

How did you get interested in this work?
I had a bit of a winding pathway here. I was originally interested in how countries grow and why some are more prosperous than others. I was a research assistant at Harvard College for Professor Dale Jorgenson, who passed away last year. He studied a variety of important topics, including the sources of economic growth of Asian countries, and I became his RA to collect data and do some very basic calculations.

The 2011 earthquake in Japan happened right as I was applying to grad school. Economists were asking about the future of Japan’s energy supply given the destruction of the nuclear power plant—there was a lot of anti-nuclear sentiment. I went to the affected villages to see the devastation. They were putting radioactive dirt in huge plastic bags, but they didn’t have anywhere to put them, so they were just stacked all over the villages. I saw that reality, but, at the same time, if they got rid of nuclear power, Japan would have to rely on more expensive, or possibly dirtier, energy sources. In the longer run, higher energy costs meant industry leaving Japan and making the country poorer.

So, there’s this tradeoff—in front of me I see these bags that are highly radioactive but there’s also the longer run costs that aren’t immediately visible. For me that was a big a-ha moment: To understand and weigh in on these high stakes discussions, we first need a way to think about both immediate and unintended effects of, for instance, getting rid of nuclear power. That’s the starting point of an informed and meaningful debate. That sparked my interest in environmental regulation, which was closer to the policy debate, and from there I got into more different kinds of products.

The other part that drew me to this work was that I always wanted to write. I published a very basic book on programming when I was in high school. When I came to college I had to take writing courses, which were always really tough but fun and absorbing. When I had the opportunity to come to HBS to research, write cases, and teach, I took it.

What do you like to do outside of work?
Recently I started taking improv classes. I wanted to learn to be more engaged with students, in the moment, and for them to have more fun in my classes. Improv is terrifying! But afterwards it’s amazing—I feel like I’m using muscles I’ve never used before. People are watching you, so you have to be present, watch, and listen to someone else and respond on the spot. It’s like going to the gym and doing a new workout and the next day you feel stiff in places you’ve never felt stiff before, or like learning how to ride the bicycle without training wheels for the first time, and somehow that feels good. It’s electrifying.

We ask a lot of our students—we expect them to be able to respond on the spot to cold calls, and yet it’s a skill I’m still learning myself. I’ve always appreciated what the students say, but this gives me even more appreciation on top of that.

Read more about Tomomichi Amano in Working Knowledge. For updates on HBS faculty research, sign up for Working Knowledge’s weekly e-mail newsletter.

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