Time's Portrait Of The American Shopper
Time interviewed Paco Underhill, a retail consultant and the author of Why We Buy: The Science of Shopping, to find out how the average American consumer shops and thinks these days. Turns out, according to Underhill, there are three types of "average consumer" out there now, and—you may have noticed this already—the era of the big box retailer is in decline.
Underhill says that most American consumers fall into one of these three categories:
- Those "who are in immediate danger of being downwardly mobile." Regardless of current socioeconomic level, layoffs and other financial emergencies have caused them to stop spending entirely.
- Those who aren't in danger now but know someone who is, and who have stopped spending out of extreme caution and a sense of needing to be more financially responsible. "It's fundamentally healthy over the long term, but it's painful over the short term."
- Those who "have very real piles of money" but who have "learned that conspicuous consumption is bad manners," and/or who have adopted the idea that financial responsibility is a moral issue.
Other highlights from the interview:
- Retail stores are getting messier, because people are picking up items, carrying them around, and then taking them out of their cart at the last minute.
- Reading labels is a more popular activity: "It used to be that label reading was linked to income and education. And now that's linked to literacy. Everyone is doing it."
- The concept of buying used seems to be increasing in popularity.
- "We have reached the apogee of the big box," and going bigger now "is actually starting to be counterproductive." Underhill says retailers are going to have to learn to edit. We find this interesting because he also points out that consumers have greater pricing transparency than ever before thanks to web access via mobile phones. How does a retailer compete on choice and pricing without bloating up their inventory?
- "I think, as a culture, we are over-stored. All store chains would be healthier if they were smaller."
Read the full interview at Time.com.
"How Consumers Shop Differently Today" [Time]
(Photo: Intangible Arts)
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Comments:
They need to add a category for those who don't spend out of spite. Every time I see an ad telling me I need something ridiculous, I call my bank and purchase a CD.
Along the same line, every time I see an NAR advertisement I forward a Case-Schiller graph to 5 potential first time home buyers.
"Retail stores are getting messier, because people are picking up items, carrying them around, an then taking them out of their cart at the last minute."
Amen to that. As a general rule, if pick something up and decide that I don't want it, I make an effort to put it back where I got it. When I worked in retail, I hate when customers do that, so I don't do it myself.
There is no doubt we are "over-stored" in this country. Now that bloated giants like Circuit City are gone, with any luck Best Buy will be next. It's amazing how these giant stores and really most retailers, have failed to adapt to the power of the internets.
Fascinating, but I really think the big-box store will be back. We are simply exiting a period of growing debt and entering a period of contracting debt. This goes for myself and many others. Once we settle down a bit, we'll start spending again. Just give us one good excuse.
I fall into that 3rd category, without the morality thing. I am just cheap, and don't buy things for the sake of having them. I guess I am un-American for that. Most of the stuff is cheap crap anyways, and its just more stuff to carry around when I have to move. Plus, I would run out of room to store the dust covered unused merchandise that I would use once, get bored of, and forget about.
I *DEFINITELY* go onto pricegrabber when I find myself in the DVD aisle. If the retailer is "mispricing" the item, I walk out. I am willing to stomach the tax vs. no tax issue and pay the sales tax if all else is equal, but am unwilling to bite a $6 overcharge as well. I realize they have overhead, etc., but it's my money.
On the other hand, I also will go to bestbuy.com to see what they are charging (in store pickup) for something that I was going to buy online. If they are competitive (or if the stars align and the item is on sale), then Best Buy will get the purchase instead of the e-tailers, so it does work both ways.
... and ANYONE pricing to include a rebate can go jump off a cliff before I fall for that :)
I don't know that I've really changed my habits that much. I just finished college a few years ago, and am feeling financially stable for the first time in my life. I've always been prone to save whatever I can, but I'm not just stashing every red cent.
I don't spend like mad... but I don't really think I've pulled back much. Hell, I just bought a damn iPhone.
@KyleOrton: That's not a bad idea. I will sometimes feel like I need something, look at it for a second, then realize that I don't need it. I "talk myself out" of buying so often!
'Those who "have very real piles of money" but who have "learned that conspicuous consumption is bad manners," and/or who have adopted the idea that financial responsibility is a moral issue.'
I mostly fall into that category. I recently got out of some big for me debt personally, so I indulged but within reason. Saved up a good bit, bought a 32" LCD TV (using Slickdeals for the best deal) and a 360 (also using SD =P ) Saved myself hundreds doing that. That hundreds is going back into paying off car quicker.
Now that I have those 2 things, I've settled back into saving mode and still have a healthy cushion in case the worst happens. I'm financially much more stable now then 6 months ago oddly enough but I wasn't someone dumb enough to buy a house when I know I couldn't afford one.
I probably don't fall into any category now because I essentially live in poverty as an intern.
But when I had a full time job or a job that paid well, I normally saved my money until I found something I really wanted.
I've always assumed conspicuous consumption is tacky. Just a trend setter, I suppose...
Where is (d), "None of the above"?
And to the people with the "piles of money": I am available for dinner parties and bar mitzvahs.
I won't *do* anything but partake in the free food, but you know. I'm available.
@Mooshie:
I didn't mind "reshop" during my brief stint in retail. It was a good chance to get off the cash registers and disappear somewhere in the store for a while.
@jrizos:
I think the discount-department store like Target or Wal-Mart will do well, but I'm not sure about specialty retailers. I can't figure out why I would buy my cat food at Petsmart or my dishes at Bed Bath and Beyond when I can just get everything at Target.
@Mooshie: I'm actually one of the weird people who will pick things up that are out of place and put them back...
Not sure what category I'm in, I think like this: "I'd like to buy a new flat screen TV." Which model do I choose? Should I go to the real store and be pounced on by some high pressure sales guy who wants me to make an instant purchase? If I look at the specs in the store, do I know what I'm actually getting? The terms "class" confuse me. What does this mean? Is it that the label on the box is misleading and class is a way to infer a size type and not the actual size? Is the picture I see in the store calibrated properly and is it using Monster* cable? Is the cheaper model in Hi-def or is it using a bad signal source? In short, is the store trying to cheat and confuse me? I think we all know the proper answer here. Once I decide what to buy, am I going to be battered to buy expensive "hi-def" cables and a useless extended warranty that the salesperson swears covers everything and they won't try to stiff me on coverage when I make a claim. The warranty replacement item won't be as nice as the one I'm paying for. At checkout, will the store sneak in a "free" subscription that will end up costing me time & money to get out of? Will the box contain the actual item I purchased, or will it be a return item from the last person? Will the item be broken so when I get home, I have to return it? Do I really need this item? This is what goes through my mind. I'm a fearful shopper just waiting to have my day ruined by the sales experience. and then having buyers remorse.
*Please don't sue me.
I can answer that: Choice.
I don't mind paying a little more to get the CHOICE of items, rather than what some buyer in MN thinks every Target should have, regardless of regional preferences or needs.
@Oranges w/ Cheese: I think I am a one man task force for straightening up the displays next to the register at drug stores and Starbucks. If I ever stop, they're going to wonder what happened.
I'm in the fourth category: people who weren't buying crap they didn't need in the first place and still aren't.
I think exactly the same way, vastrightwing. I feel as if the retail store is going to war with the consumer, and that the consumer has to fight for what rightfully should have been theirs, or fight to get a vague policy clarified. They use all kinds of tactics to force the consumer to adopt to the mentality of the retail store, but its just now with the information age and the power of the Internet that the consumer is now fighting back against the tactics of the store.
We as consumers have been puppets of the store for too long, and now we are fighting back, and retail simply doesn't know how to keep up with an ever-growing educated consumer base. They don't know how to deal with consumers who are fighting back. Because before a retail store could con the consumer into all sorts of stuff for profit, but now that the consumer is wising up times have changed.
I've been thinking about this recently, and I haven't really changed my spending habits. I've changed some of my personal habits, mostly in the direction of being healthier, but the spending tends to balance out there: you can cut unnecessary junk from the grocery budget, but the healthier stuff costs more. Otherwise, I'm the same skinflint I've always been.
One thing I've been doing lately: every time I buy something on sale, I take the difference from regular price and put it in savings. It keeps me motivated to seek out sale prices and coupons, because I like seeing that account grow.
@vastrightwing: I'm in that category with you:
4. People who have the means to spend, but who are so disgusted with the retail environment right now that they prefer not to spend any money.
I always love it when these articles with vast generalizations come up because I never fit into any of them. While I do feel an oppressive concern over my job (my employer just announced we'll be closing a facility that is home to 10-20% of our employees soon), I am currently planning to buy a house and a car and will likely put together a new computer, getting furniture and appliances for the house, and maybe even picking up a new HDTV.
But also, when everyone was throwing around money they didn't have and refinancing and heloc'ing themselves into oblivion, I was saving like a madman and will be able to throw 20% down on the house and get better than 15 grand back as a trade-in on my current car (which I bought soon after graduating from college).
yeah, it's funny that articles like this almost always fail to consider people who plan ahead and spend responsibly. =/
@Mooshie: I have repeatedly told my bf: "I'm just going to hold this" and continue to walk about the store with the item. Sometimes I will buy it, sometimes not. However, if I don't want something I always give it to the cashier instead of stashing it somewhere else.
When it comes to straightening I am the worst at bookstores. I tend to be a little OCD and sometimes I will rearrange the books slightly on the shelf so that a better title will be facing out instead of its spine.
@Chris Walters: Thank goodness I'm not the only one who does this. Maybe since we spend so much time straightening up after the kids, the urge to unscramble the displays becomes irresistible.
Paco Underhill is the man. "Why We Buy" and "The Call of the Mall" are fantastic books, and shopping would be a more rewarding experience for both the consumer and the retailer if retailers paid more attention to him. Anyone interested in the "science of shopping," as he calls it, should check out his books if they haven't already.
@antoineawwad: Oh man, you're awesome! God I wish I was you. Are you a girl? If so, can I date you? If not, want to be friends?
Can we kick this douchebag off? This type of crap will ruin the site...
@TheSpatulaOfLove: I could buy my cat food at target or walmart, but the don't carry the all natural no additive stuff, besides I support my local pet food store, and in turn I get free stuff all the time for being a loyal customer.
@dangermike: I don't fit into any of the categories either. They're pretty narrowly defined, to be honest. Not everyone has suddenly drastically changed their spending habits. But I guess that doesn't make for good news.
Most Americans fall into those categories? Where did he get this data from? My guess is that maybe a few of his neighbors and coworkers fit this category and he decided to extrapolate from there.
@Mooshie: I work retail and I don't mind if people do this, but please people - no perishable food items! Just give it to the cashier. You have no idea how many times I've found perishable items stashed in office supplies or the automotive dept. - containers of warm yogurt, packages of cheese - come on people!! The worst experience was when I found a package of sushi that someone had hidden behind a stack of books for about 4 days - you have no idea how many worms were in that package (and I'll never eat sushi again!)
@Mooshie: This is much more prevalent in poorer neighborhoods. I remember the first (and last) time I tried shopping in the Harlem Pathmark. I was shocked when the woman ahead of me in line at checkout went through her cart item by item, placing half the items on the belt to be rung up, and dumping the other half ON THE FLOOR of the checkout lane. 2lb bag of M&Ms? Ring it up. 2lb package of fresh hamburger meat? Floor. Froot Loops? Ring it up. Broccoli? Floor.
I looked around and realized that this was common practice at this particular store. Every checkout aisle had a little mound of food on the floor. Bizarre.
@mamalicious: A friend of mine that stocks bread for a local bread bakery noted all of the weird items stashed in the bread aisles of our city's three Walmarts - from car batteries to melted, partially consumed ice cream.
I almost never buy from big box retailers anymore. I quit getting groceries at Wal-Mart and switched to Wegman's for food shopping. For clothing, books, and other items, I hit up an amazing local consignment shop, Salvation Army, and eBay. I've been able to get $40 or $50 brand name pieces of clothing for $4 or $5. Salvation Army has half-price days on Wednesdays - I've gotten brand new items with the tags still attached for $1 or $2. I'm very comfortable in terms of money, but I never saw the need for buying expensive brand new items if I could get them for less at consignment shops and thrift stores.
Time magazine is still around? I haven't seen it in the doctor's office for years.
@chatterboxwriting: For music, hit your local used record/CD store. You can really get some deals there and trade in the stuff that you don't want anymore for either cash or in exchange for new to you CDs.
"I think, as a culture, we are over-stored. All store chains would be healthier if they were smaller."
The most insightful thing Mr. Pseudonym said, though it was apparent to everyone (except retailers) decades ago, or maybe more. By the time we could buy milk and guns from the same store, that was the apogee.
@skizsrodt: I agree with you, I'm kind of a minimalist and have never liked to spend unwisely.
However, I totally think money is a moral thing. "Where your money is, there your heart will be also," are words I try to live by!
@themicah: Harlem Pathmark. That sounds like double hell.
And I thought the Pathmark in Shirley (out on Long Island) was bad...
Just by sheer coincidence, I happen to have this book out from the library. I guess the lure of Mr. Paco's retail yarn was not enough to get me to spend any money.
I was expecting an exposé on marketing tactics, and how to avoid them.
Instead I got the opposite.
Paco Underhill, and his company Envirosell, may be the biggest assholes on the planet. They are essentially a rabble of malevolent peeping toms loitering in retail stores to literally spy on ordinary people without their knowledge or consent. Then, companies pay them to use your personal behavior to manipulate your decisions.
If I ever caught someone doing this to me, I would absolutely kick their ass- legal or no. No discussion, apology, or explanation needed. If I ever found out a company was allowing this to happen in their stores, I would never visit them again.
Frankly I am disgusted, but not surprised, that this is legal. I have tried to think of a lower profession, but all I can come up with is 'Ambulance chaser'.
I am one of those people with a pile of cash. I got so used to saving that I am not cutting back my shopping habits because I never overspent to begin with. There is a reason why people have money, they never spend it. By the way, everyone calls me cheep and thinks I am poor. It is a great way to live life.
@pigbearpug: I agree. Please. This is one of the few sites that I frequent where I don't have to put up with this sort of nonsense.
Sadly, an independent owner option isn't available in every community. Props to you for supporting a small business owner...
I'm right there with you! I just went through that experience last night. I was looking at a small tv that I had priced online. I got to the store and just got confused and offended by the prices and other models.
The entire time I thought exactly what you wrote above! I hate the current system. I am by no means a timid shopper but I really don't want to deal with sales people and the BS that comes with them.
first! wihaaaaaaaaaa