Ready or not, the holidays are here and the shopping season is upon us. Although I wish I could convince you not to shop during November and December — I'm a fan of Buy Nothing Day myself — I realize I'm in the minority. It's Black Friday. It's Christmas. People are going to shop.
If you do choose to shop this time of year, be smart about it. Make no mistake: It's a war out there, my friends, and the merchants aren't on your side. They want your hard-earned money just as much as you do, and they've got all sorts of tricks to separate you from your cash.
You see, merchants are smart. They spend billions of dollars every year conducting research into what makes people like you and me buy things. And so they put the sweetened cereal at your 6-year-old's eye level. They block the aisles with displays to create traffic jams in front of the things they want to sell. They'll even use scent to encourage spending!
In his 2000 book Why We Buy: The Science of Shopping, Paco Underhill — an environmental psychologist — described what he'd learn through years of research into consumer behavior and retail marketing. Some of this stuff is very subtle.
The Science of Selling
Underhill's company, Envirosell, sends trained observers into stores to follow shoppers, making detailed notes about how they interact with the products, fixtures, and employees. This information is then used to help the store make changes to encourage more spending.
For example, Envirosell's research has demonstrated repeatedly that “women especially, though it was also true of men to a lesser extent, don't like to be brushed or touched from behind.” Because of this, Underhill recommends that the space around makeup counters be large and uncluttered, allowing women to shop undisturbed. If they don't feel crowded, they're going to spend more time and more money on makeup.
The best sections of the book are those in which Underhill provides real-life examples of shoppers interacting with their retail environment: little old ladies down on their hands and knees, crawling around looking for the right bottle of aspirin; grocery-shopping fathers who buy whatever their children put in the basket; people, with carts loaded full of electronics equipment, who leave the store because the checkout line is too long.
The longer anecdotes are especially revealing:
I once heard a talk given by the vice president of merchandising from a national chain of young women's clothing stores in which she deconstructed a particular display of T-shirts. “We buy them in Sri Lanka for $3 each,” she began.
“Then we bring them over here and sew in washing instructions, which are in French and English. Notice we don't say the shirts are made in France. But you can infer that if you like. Then we merchandise the hell out of them — we fold them just right on a tasteful tabletop display, and on the wall behind it we hang a huge, gorgeous photograph of a beautiful woman in an exotic locale wearing the shirt. We shoot it so it looks like a million bucks. Then we call it an Expedition T-shirt, and we sell it for $37. And we sell a lot of them, too.”
It was the most depressing valuable lesson I've ever had.
Like it or not, you're manipulated all of the time while you're shopping, and in ways you don't even suspect. But by taking Underhill's lessons for marketers and flipping them around, you can make yourself immune to marketers' manipulations. (Well, maybe not immune, but less likely to succumb to their ploys, anyhow.)
How to Spend Less
By taking Underhill's lessons for marketers and flipping them around, we can gain some insights into how consumers can win the retail battle. Here are some easy changes you can make to spend less at the store:
- Spend less time in stores. Underhill writes, “The amount of time a shopper spends in a store (assuming he or she is shopping, not waiting in line) is perhaps the single most important factor in determining how much he or she will buy.” Do not browse. Shop with a purpose.
- Don't use a basket. Only use a basket (or shopping cart) if it's absolutely necessary. If you're dashing into the supermarket to pick up milk and bread, carry things in your hands. Baskets induce people to buy more.
- Only seek employee contact if you need help. Employee interaction also induces people to buy more. Underhill notes that “the more shopper-employee contacts that take place, the greater the average sale.”
- Don't try samples. Research indicates that people are more likely to buy something if they can sample it first. Don't try the samples as you wheel around the giant warehouse store — they're likely to make you want the product.
- Don't examine or handle things you don't need. The more you interact with something, the more likely you are to buy it. “Virtually all unplanned purchases — and many planned ones, too — come as a result of the shopper seeing, touching, smelling, or tasting something that promises pleasure, if not total fulfillment.”
- Don't try on clothes you don't need. “Shopper conversion rates increase by half when there is a staff-initiated contact, and it jumps to 100 percent when there is staff-initiated contact and use of the dressing room. In other words, a shopper who talks to a salesperson and tries something on is twice as likely to buy as a shopper who does neither.”
- Avoid advertising. Advertising exists for one purpose: to get you to buy things. If you don't want a closet full of Zizzer-Zoof Seeds and Thneeds, reduce your exposure to advertising.
- Make a list and stick to it. The majority of supermarket purchases are unplanned. Underhill writes: “In one supermarket study, we counted how many shoppers came armed with lists. Almost all of the women had them. Less than a quarter of the men did. Any wife who's watching the family budget knows better than to send her to the supermarket unchaperoned.”
- Ignore the racks of impulse items. These are high-margin products designed to make the retailer profit while parting you from your money. These are not things that you need.
- Don't go shopping. The number one way not to buy anything is not to go shopping. It's obvious, but true.
All in the Family
Why We Buy notes another way your family can save money at the grocery store: have mom do the shopping.
Supermarkets are places of high impulse buying for both sexes — fully 60 to 70 percent of purchase there were unplanned, grocery industry studies have shown us. But men are especially suggestible to the entreaties of children as well as eye-catching displays.
Underhill notes that in many other ways, men and women shop differently. Most men don't enjoy shopping. “As a result, the entire shopping experience is generally geared toward the female shopper.” Specific differences read like a list of gender stereotypes:
- Men move faster through stores.
- Men spend less time looking at things.
- Men don't ask where things are.
- If a man can't find what he wants, he'll just leave.
- When a man finds something he likes, he's more likely to buy. “In one study, we found that 65 percent of male shoppers who tried something on bought it, as opposed to 25 percent of females shoppers.”
Men may shop quickly, but because they don't often shop from lists, they're just as likely to overspend as women who spend more time in stores. In fact, the combination most likely to splurge is a father with his children.
In fact, the book is full of “man with children” anecdotes, repeatedly demonstrating that families should either not allow fathers to take their children shopping, or that men should be trained to tell their children, “No!”
Many of you have probably read Malcolm Gladwell's best-selling Blink: The Power of Thinking Without Thinking. That book, too, points out the power of marketing, emphasizing how shoppers are manipulated in lots of tiny ways. Even when we think we're immune to marketing, we're not.
Good stores perform a kind of retailing judo — they use the shopper's own momentum, her largely unspoken inclinations and desires, to get her to move in a direction unplanned, and often unaware. In the end, it's not enough that goods be within reach of the shopper — she must want to reach them. And having reached them, she must then wish to own them, or all this effort goes to naught. Amid so much science, we discover in the end it's love that makes the world of retailing go round.
So, be careful out there, folks. If you're going to shop on Black Friday — or at any other point during the holiday season — be smart about it. Go prepared. Stick to your budget. And, most of all, watch for the tricks that merchants use to lure you to buy.
Author: J.D. Roth
In 2006, J.D. founded Get Rich Slowly to document his quest to get out of debt. Over time, he learned how to save and how to invest. Today, he's managed to reach early retirement! He wants to help you master your money — and your life. No scams. No gimmicks. Just smart money advice to help you reach your goals.