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by Carol Kaufmann, AARP Bulletin, December 3, 2009
What is it that convinces us we must have some object? And what entices us into stores and compels us to plop down hard-earned cash (or well-worn plastic) for it? Is it the clever strategies of advertisers who know our weak spots? Do we have an insatiable need to shop? Can “stuff” really make us feel good?
Eager to get a grassroots view of American consumerism, Lee Eisenberg, former editor of Esquire magazine and an executive at Lands’ End, got a job as a floorwalker at Target. Beneath the big red dot, he learned firsthand about the complicated selling machine that lures us to the cash register. He also combed through piles of academic research—“There is no part of American consumerism that hasn’t been studied,” he says—to understand the complicated humanbuying machine and infused his latest work, Shoptimism: Why the American Consumer Will Keep On Buying No Matter What, with both the selling and buying sides of the equation. (Read an excerpt from the book.)
But why dwell on shopping psychology when there are far fewer dollars to spend? With optimism for better economic times building, perhaps now is the ideal time for a little navel-gazing about our own shopping habits. And, as Eisenberg told AARP Bulletin Today, a customer’s desire to acquire is not always such a bad thing.
Q. With fewer customers in stores, how are retailers compensating?
A. One way is by controlling their inventories. There’s a saying in the industry that in holiday season “stack ’em high and see ’em fly.” Last Christmas, retailers didn’t anticipate the collapse in October and November and had huge levels of merchandise. Customers could see discounts of 60 to 70 percent. Stores buy holiday merchandise six to eight months prior. So if you roll back the clock to spring, we were all pretty morose.
Q. If now it’s “stack ’em low and hope they go,” how can consumers get great deals?
A. If you want a specific toy or a specific consumer electronic item that you’re afraid won’t be there, buy early. But if you’re after a sweater, my advice is to wait a little bit. If the sweater’s gone, chances are there’s another perfect sweater not far away.
Q. In general, what pricing strategies do retailers use to get us to buy?
A. One strategy is to impose a sense of scarcity by advertising “one week only” or “while supplies last.” Another is to plant the idea that a product is versatile: “Has 101 uses!” or “Buy a pack for home, picnic and your car.” There’s also the old standby, “Three cans for $6.”
Q. Why does that work so well?
A. There’s a theory accepted by most academic researchers that we have in our head a reference price of what something should cost, whether we’re conscious of this or not. These tactics move our minds off the reference price and into another realm. We think we should stock up, or we’ll get a lot of use out of the product, or that there might be an occasion to use it that we’re not thinking about. These tactics tend to shift the debate onto another plane.
A. I’ll give you another we actually used at Lands’ End—a classic selling technique called “good, better and best.” In a catalog, or even in the store, we offered a product in three levels of quality and price. Take a down jacket. The high-price version has a fur-lined hood and has a down fill that will keep you warm in cold down to -50 degrees. Say it’s $220. We’d feature that jacket relatively small on the spread, or in the store, off to the side.
Q. In a not-very-noticeable place?
A. Yes. But there’s also an inexpensive version that costs, say, $89. It’d have less down, no fur-lined hood, and come in few colors. Both of those extremes pointed to the “hero” product, which was the one shown big on the page or prominently displayed in the store. It has more features than the low-priced one but fewer than the high-priced one. And it’s the one we want to sell the most of because we have the most in stock.
Q. Would this strategy appeal to our readers, who are well read and over 50?
A. I actually think it would. By calling out the various features—the goose-down fill and so on—we explained the product to the degree that many marketers and retailers don’t bother with. A huge amount of advertising these days is silent. It’s largely visual, but boomers don’t buy into that kind of image advertising. Most advertising is visual, and by the time you get to the age of today’s boomers, you’ve kind of had it with the visual seduction, and you really want someone to tell you what’s in it, why it’s better than other things and why it’s worth the price tag.
Q. Do retailers miss the boat on marketing to older Americans?
A. Oh, yes! A study in the Advertising and Marketing Review said that while people over 50 have half the total discretionary revenue in the U.S., they are the target of only 10 percent of ad messages. So you have a disproportionate amount of money spent marketing to younger people who don’t have remotely as much discretionary income.
Q. Any other misperceptions?
A. One which is incredibly persistent—and wrong—is that boomers at middle age have established brand loyalties, whereas the younger customer is fickle. Get ’em while they’re young and have them for life! But many surveys contradict that and say boomers are not nearly as brand-loyal as we are made out to be and are very quick to jump from one brand to another if for any reason that brand breaks its promise.
Q. How can a brand break its promise?
A. Starbucks broke a number of its very idealistic promises in the name of growth and expansion. They put a number of stores on the same intersections; these stores are essentially clones, and they used to be very original and idiosyncratic coffeehouses. You used to be able to see the barista making your drink; that was engaging and fun. But then they replaced that machine with a newer, faster, better model—and it sits lower on the counter so you can’t see your drink being made. They began to vacuum-pack their beans, which meant that one of Starbucks’ greatest marketing points—the aroma—to a large degree is removed. These are broken promises. And when a promise is broken, it’s very hard to turn it around, because there’s so many competitors ready to step into the breach.
Q. Why does buying stuff often make us feel so good?
A. Some things we buy do have a positive emotional payoff for us. If we’ve had a hard or good week and we want to make ourselves feel a little bit better or want to reward ourselves, we go out and buy a dress or tie just because it perks us up. I don’t see any crime or any sin in that.
Q. But it’s just stuff.
A. Look, one of the needs on Maslow’s hierarchy of needs is affection. We need love—and if buying something might make us more attractive or lovable, what’s wrong with that? Or buying something for someone who doesn’t need jewelry from Tiffany’s, what’s wrong with expressing affection through a material object?
Q. Why do we crave things we don’t strictly need?
A. Think of it this way. A friend of mine’s husband collects model trains. He spends a huge amount of money on them. And though model trains certainly aren’t a need, I could count any number of justifiable reasons for him to have this enormous train collection.
Q. Like what?
A. He invests a lot of creative time in his trains. He makes little houses, thinks of ways to sprinkle artificial snow on little plastic mountaintops. Kids from the neighborhood marvel at his work, which gives him a lot of satisfaction and pride. He goes to railway conventions and convenes with like-minded members of his tribe, which gives him social satisfaction. Those things are not nothing.
Q. Life-affirming, you could say.
A. Maybe even self-actualizing. He’s coming into his potential through that model train set. The anti-consumerists, as I call them, don’t give him enough credit for things he might be deriving from what might otherwise be seen as wanton, reckless spending.
Q. What other kinds of purchases would you call worthwhile?
A. A whole category that’s not really thought of as consumption—but is—is experience. Travel, for example. Not only do you enjoy a trip to the Grand Canyon or to Paris, but generally speaking, the memories of those trips get better over time. A material thing doesn’t do that—except in the case of wine or aged beef. Things go out of style, they get dissolved in the washing machine, you rip or lose them. But over and over again memories are shown to be a meaningful thing to consume.
Q. And you experience memories, generally, with others, not in a vacuum.
A. A great example of this is the American Girl Company. If you ever go into one of those stores, it’s very common to see two or three generations of women shopping together. The little girl, the mom and the grandmother. Grandparents are the dirty little secret to the enormous success of this line.
Q. How so?
A. Social scientists have studied the American Girl phenomenon in part by interviewing grandparents. Over and over a grandmom will say part of the reason she enjoys this is so her granddaughter will remember the day Nanna took her to the American Girl store. To Grandma, it’s an investment in a memory.
Q. The shopping trip itself is worth as much as the purchase.
A. The doll becomes a tangible reminder of that. Often stuff is invested with something quite emotionally real. We don’t give enough credit to that.
Q. But can things provide the same kind of emotional response?
A. I use an example of a woman in her 30s who lost her father. The one thing she really regretted not having was her father’s iPod, which had been lost. When I asked why, she had an incredibly profound answer: All the music he loved was on there. It carried the personality of the being who owned it and would have been a meaningful thing to have kept. This is thinking about consumption in a way that doesn’t get talked about very much.
The reason the book is called Shoptimism: Why the American Consumer Will Keep On Buying No Matter What is not because the American consumer is going to be greedy at all costs but because there are some legitimate and profound payoffs that come from buying things or experiences.
Carol Kaufmann is a contributing editor at the AARP Bulletin.
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