Why We Shop

Posted: Dec 10, 2007 5:22 PM
Why We Shop

Someone once called Paco Underhill the Margaret Mead of shopping. That’s because the founder, CEO and president of Envirosell has spent more than 25 years studying the behavior of consumers and helping companies understand them and how they shop. Underhill, a regular contributor to PBS and the BBC, is the author of the worldwide best-sellers “Why We Buy: The Science of Shopping” and “Call of the Mall: The Geography of Shopping.” As the average consumer gears up to buy 23 Christmas gifts this shopping season, I talked to Underhill on Wednesday, Dec. 5, by telephone from his offices in New York:

Q: When someone asks you what you do for a living, what do you tell them?

A: I am the chief executive officer of a research and consulting firm that looks at the interaction between people and spaces, people and products and people and places. My second job is writing international best-selling books. And my third job is doing motivational speaking.

Q: You have made your name by studying consumers and their behavior. It’s almost like you’ve studied them as though they are a unique tribe in their own environment? How did you approach that?

A: I am an observational researcher. Our work is based on the act of physically watching people as they move and interact. Over a typical year, we follow through a store, a bank, a museum, a train station, an airport, a hospital somewhere between 60,000 and 70,000 people. We follow them anonymously, meaning that we aren’t interested in what their names are or where they come from. We categorize them based on the (demographic) group and their approximate age and dress. We are not particularly interested in the actions of an individual but we are interested in establishing patterns.

Q: Is their any single most important thing that you’ve discovered about consumer behavior over the last 25 years?

A: I think we can divide stuff into what are the biological constants and the things that are changing. The biological constants govern the things that are driven by us being right-handed, or that our eyes age in a very predictable manner, or that there are some basic ergometrics, or human measurements, that factor into how we interact with stuff. Those are the biological constants -- and then there are things that change.

Q: How has the consumer changed most dramatically in the last 25 years?

A: I think one of the most seminal issues of our time is the changing status of women, that we as a culture -- and not making any moral judgments -- have stepped away from biology. I thought it was very interesting that in a recent study ... that if you took a working 25-year-old woman and a working 25-year-old man living and working in New York City, the woman makes more money than the man does. Women are the majority of graduates from almost all institutions of learning, whether it’s undergraduate or graduate school, from medicine to law -- women are there. And while there are glass ceilings in terms of what they make later in their career, women are being better educated and getting better jobs than their male counterparts are.

Q: If women weren’t such an important part of the consumer economy, would everything be different about the way we shop and consume?

A: We live in a world that is owned by men, designed by men, managed by men, and yet we expect women to shop in it. Now while that’s certainly changing, and isn’t as bad as it used to be, that’s still the fundamental underlying truth.

Q: Should Americans feel guilty about the crazy consumer culture we’ve created?

A: I think one of the things that we at some point are going to have to face is that the party is over -- that many Americans have consumed beyond their means and need to go back to work within the context of their budgets. We can divide us consumers into three groups: One is roughly a third of us that feel the immediate anxiety of downward mobility, meaning that we are scared of living at a lesser standard than we do now. That’s both an emotional and economic reality for that first group. The second group to which downward mobility is an emotional reaction -- meaning that whether they are middle-class families or whether they are lower-class families -- still feel a basic level of economic anxiety. (I might point out that in each one of the three groups I am laying out, I’m not just talking about lower class, middle class and upper class, I’m talking about a portion of each one of those classes.) The third class are people who are doing just fine and have no anxieties.

The bottom line for all of us, though, particularly for those of us who are over age 50, is that most of us could live the rest of our lives on fruit, vegetables, pasta, wine, olive oil and yearly doses of socks and underwear. We have all the ties and shirts and sweaters and lawn mowers and television sets that we’ll need for the foreseeable future.

Q: They say in a free-market economy like ours that “the consumer is king.” But who has the upper hand, the retailer or the shopper?

A: The shopper does -- absolutely. The merchant has the power to be able to make their offering as attractive and integrated as they possibly can. But certainly we as consumers have to take responsibility for our own behavior. We can’t turn around and blame the Domino sugar company for obesity or Anheuser-Busch for alcoholism. I don’t think we can blame the merchant for us as a culture overspending.

Q: Has online shopping changed anything about our consumer culture?

A: I think online is having a definite impact, both in the sense that people are buying online -- and I think that is going to increase just if we think about the fact that so many of our purchases are routine. If I open your refrigerator, 80 percent of what’s there are routine purchases. I think we are looking at something in our not-too-distant future when in effect our refrigerator does the online purchasing for us. The second thing is that we are using online as a way of pre-shopping -- meaning that we are using it as a way of better educating ourselves before we actually make the move.

Q: Is online shopping a good thing or a bad thing?

A: Oh, I think it’s basically changed the rules. One of the things I’m looking forward to here is the use of convergent technologies as a way of making us a more-ecologically responsible culture, meaning if I go into a store now and I want to pick up an over-the-counter medicine, it comes with an enormous amount of paper. Whereas if I could point my phone to the UPS code and download on my phone all the instructions about what Tylenol-Plus PM was, that would save an awful lot of trees. So I am looking for in the not-too-distant future a better convergence of technology -- the online world and the physical world -- in a way that helps us take packaging and extraneous product out of our consuming culture.

Q: Are shopping malls losing their appeal and power?

A: At least here in the U.S., we have a category of malls that are doing extremely well, and we have a category of malls that are holding their own, and we have a category of malls that are deeply troubled. Let’s recognize that the American enclosed mall, which was built 25 years ago, was butt-ugly the day it opened and hasn’t gotten any prettier. There are very few American shopping malls that are going to be nominated for landmark status.

Q: Malls went through a period where it looked like they were trying to become entertainment centers as much as shopping centers. Did that work?

A: Almost every developer across the world, not just here in the U.S., is trying to go from being a landlord to being “a place maker” -- meaning they are trying to take whatever structure they have and make it a place where we can shop, we can dine, we can recreate, we can live and we can work. If we look at the most successful shopping malls in 2007 all across the world, many of them have a customer base that if they wanted to shop the mall in their bedroom slippers they could.

Q: Wasn’t the original design of the mall supposed to have living space above it and be almost like a self-contained community?

A: The mall as it was first conceived of here in the United States was first as a way of making shopping in inclement weather more pleasant. It grew from there. If we think about the covered wagon circling and focusing in, rather than out. They were a product of suburbanization. As malls went to other places, and as they became part of an urban planning program, yes. Almost all developers now are looking at building “alls” as opposed to “m-a-l-l-s.”

Q: You were in town recently talking to Giant Eagle supermarkets. Do you remember what you were telling them?

A: Part of what I was talking with them about are trends in grocery shopping and the design of grocery stores. In general, the quality of American grocery shopping across most of the country has gotten significantly better in the past 10 years. We have more organic product, it’s fresher. Yes, there have been some glitches in terms of the quality of goods, but if you are willing to pay for it, Americans have been eating -- or have the potential for eating -- better than they have at any other point in the past 50 years.

The other piece here is that the supermarket community is reacting to a new competitor that is no longer underneath the radar screen, which is the farmer’s market. The farmer’s market movement all across the country is booming and my hat’s off to 'em.

Q: So the reason we’re seeing Giant Eagle turn its produce section into a fancy French fruit and vegetable stand is the competitive pressure from farmer’s markets?

A: Yep. It’s all contributed, first of all, to making local produce much more attractive, and part of what you will see both at the farmer’s market in particular but also at Giant Eagle is featuring the stuff that’s grown within a certain proximity of where it’s going to be consumed.

Q: What is the best advice you can give to a Christmas shopper headed for a mall right now?

A: Think first. Which is that during the holiday season we are giving people the icons of our feelings toward them. And constructing a good icon that tells somebody “I love you” or “I care about you” or “I’m proud of you” isn’t about the amount of money you spend. It’s about the thought that you put into it.