1. RETAIL ATMOSPHERICS
A Practical Guide to Serving Your Customers
Right in the 21st Century
Dr David Lewis-Hodgson
A Chartered neuropsychologist, Sony Award-winning broadcaster, and Chairman of
Mindlab International ® David offers keynote conference presentations & runs in-
house seminars on his company’s unique consumer research projects. David is the
author of more than twenty books on psychology & selling, including The Soul of the
New Consumer: What We Buy and Why in the New Economy.
2. INTRODUCTION
Rising worldwide affluence combined with radical new marketing and
retailing technologies have changed forever the wants and desires of
customers. The modern consumer has high expectations and a low tolerance
for mistakes by suppliers.
While a majority is, despite the recession, still cash rich and time poor there is
a rapidly growing proportion of “grey consumers” who have both plenty of
time and a high level of disposable income.
Many of today’s consumers want it now or they do not want it at all. Span of
both attention and desire by customers are shorter than at any time in the
history of selling. As more and more consumer needs are easily met,
increasing amounts of disposable income are becoming available for
“wants”, luxury articles and services with a strong feel good factor. The
modern consumer is highly aspirational. Merely maintaining current social
status is no longer sufficient for them. They are more interested in emulating
the materialistic lifestyles portrayed in the media than simply ‘keeping up’
with their next-door neighbours.
ATTRACTING THE MODERN CONSUMER
The interest of the modern consumer is aroused by change. When designing
a window display, it is important to take into account the way a consumer is
going to live with the product and allow passing shoppers to view the
product from that distance.
When graphic information forms part of the shop front message, make sure
that it can be read as shoppers walk past; don't expect them to stop to get
the message because they are most unlikely to do so.
The past fifty years has produced a marked change in how people make
sense of printed messages. Americans and Europeans no longer read letter
by letter, but have graduated to reading letter clump by letter clump - one
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3. reason why typefaces that allow for closer positioning of letters are used
much more often than in the past.
Retailers must also understand when and how shoppers will first see their
display. Generally the most important view of a display will be at an angle
rather than straight on.
Some retailers believe the front of the display is of key importance, but the
impulse to shop begins 20 to 25 feet away. The further away someone can
see a display, the longer the impulse has to take root. If shoppers cannot
determine a display's nature and message until they're in front of it, many will
pass it by. Product marketers can avoid this problem by using two-sided or
triangular displays that can be seen at an angle from 20 to 25 feet away.
Considering sight lines is especially important in the case of overhead signs.
These should always be at an angle from where customers are likely to stand,
because people don't stand and look straight up.
While studying sight lines for a display, retailers must also take account of the
time shoppers will spend within viewing distance of the display. This
information will affect the size and length of the message featured on the
display.
It is also important to remember that when signs compete with people for
shoppers' attention, other people will always win – especially when the signs
are not located at eye level.
Studies have found this to be true consistently, especially in high-traffic areas,
such as checkouts. Retailers can use this to their advantage by identifying
prime people-watching locations, such as checkouts, and positioning signs at
eye level, so that shoppers watching one another will see the sign when those
people move. Poor placement of information signs not only causes frustrated
customers to walk out but also takes up the time of sales staff as they are
asked the same series of questions over and over again. What type of
shopper is most likely to check out your display? Are you targeting mothers,
fathers, children, or grandparents? The answers will determine how you should
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4. design and position your display. Women, for example, have a much lower
tolerance than men for crowding and being brushed up against in a store.
This phenomenon, which an American research company has termed the
"butt-brush factor," means that if you have a display aimed primarily at
women and positioned in a narrow aisle with heavy traffic, you're unlikely to
enjoy a high conversion rate of browsers to buyers.
The more things there are to look at and the more time it takes to make a
purchase decision, the more likely a woman shopper is to be influenced by
the butt-brush factor.
HOW DO YOU DEAL WITH THIS FACTOR?
Design or position your display so that you provide a natural safe area where
women are able to browse comfortably, or simply make sure that your display
isn't located in a narrow aisle. Remember, too, that women might have
children and baby buggies in tow. This creates the need for additional space
and good sight lines for watching the kids. Aisles and entrances need to be
stroller accessible. Even if babies and toddlers are not a store's prime market,
the consumers they bring with them often are.
Research for a major bookstore chain identified the butt-brush factor and the
need for women to watch children as major obstacles in converting browsers
to buyers. The chain was advised to adopt a store layout with angled instead
of straight aisles to create browsing "nooks" for displays at the end of each
aisle. It also suggested positioning the children's book section adjacent to
popular women's sections, such as romance books, and lowering sight lines
between the sections to enable mothers to watch their kids and browse
simultaneously.
These simple changes led to increased browsing and more book sales. Such
findings advise product marketers to make it easy. Take a step back. Think
about a middle-aged person with a bad back who wears glasses but forgot
them. If that person can successfully interact with your display, then you've
covered your bases.
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5. In addition, make sure that if your display features discretionary items, it is
available and visible to everyone who might influence the purchase decision,
particularly children.
THE DECISION TO PURCHASE
The power of kids in affecting discretionary purchases is growing with the
increased number of working parents and single parents; parental guilt may
be a key factor in this trend.
Most products are handled many times by browsers before someone buys
them. The average lipstick case has been examined six to eight times before
it leaves the store, a compact disc 12 times, a greeting card 25 times.
Purchasers, for example, spent an average of eleven minutes and twenty-
seven seconds in the store, non-purchasers two minutes and thirty-six seconds.
It wasn't that the non-purchasers just cruised in and out, in those two minutes
and thirty-six seconds they went deep into the store and examined an
average of 3.42 items.
The harder it is to find the fixture holding the goods, the more the chances of
a purchase decrease. Shoppers should also be encouraged to touch the
merchandise, especially clothing. This is especially important given the fact
that the number of purchases made is down significantly from 20 years ago.
Purchasers today look at 4.81 items per store visit but buy only 1.33 items.
Inadequate service and display presentations that fail to suggest add-on
purchases are typical culprits.
A shopper's decision whether to purchase or not is also deeply influenced by
lines at the checkout. Stores should look more closely at these areas and
make changes that improve efficiency. A well-designed cash wrap station
cuts transaction time and employee fatigue.
Studies show that putting a staff member in front of the checkout to manage
rush-hour traffic gives the perception of organising and reducing the waiting
time. In another study the difficult transition from cashier to salesperson
reduced business.
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6. As the retail market grows more cutthroat, retailers have come to realise that
it's all but impossible to increase the number of customers coming in, and
have concentrated instead on getting the customers they do have to buy
more. If you can sell someone a pair of pants you must also be able to sell
that person a belt, or a pair of socks, or a pair of underpants, or even do what
the Gap does so well, sell a person a complete outfit.
THE POWER OF THE MARKET MAVENS
"This is a person you would go to for advice on a car or a new fashion," says
Linda Price, a marketing professor at the University of South Florida, who first
came up with the Market Maven concept, in the late eighties. "This is a person
who has information on a lot of different products or prices or places to shop.
This is a person who likes to initiate discussions with consumers and respond to
requests.
Market Mavens like to be helpers in the marketplace. They take you
shopping. They go shopping for you, and it turns out they are a lot more
prevalent than you would expect."
Mavens watch more television than almost anyone else does, and they read
more magazines and open their junk mail and look closely at advertisements
and have an awful lot of influence on everyone else. According to Price, sixty
per cent of Americans claim to know a Maven.
What's really interesting is that the distribution of Mavens doesn't vary by
ethnic category, by income, or by professional status. A working woman is just
as likely to be a Market Maven as a non-working woman; there is simply no
clear demographic guide to how to find these people. Mavens are better
consumers than most. They are very feature oriented and not pushed by
promotions. You can reach them, but it's an intellectual argument.
THE GROWTH OF THE GREY MARKET
One of the realities of our ageing culture is that in the next two decades we
will witness the largest transfer of wealth in the history of the species, as baby
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7. boomers' parents pass on their wealth to the next generation. That transfer of
wealth represents a huge opportunity for banks, and the most effective
location for building that relationship is at the branch level.
The older consumer is fast becoming a major force in the marketplace – yet
one that is often poorly understood and inadequately targeted. An important
consideration, for example, is the fact that while many are highly affluent
others are more time-than-cash rich. Older consumers tend to be less
impressed than younger adults with the trappings of image. They also value
recognition of their existence.
Retailers need to realise that when it comes to mature consumers they are
competing both within and outside of their particular category. Seniors,
especially those with higher incomes, already have most of the basics and
can afford to make more discretionary purchases. This means that few
retailers can now afford to say: "Older people aren't my customers."
Although they have some distinct spending patterns, older consumers
generally buy most of the same things that younger people do, so product
mix may be less of an issue in appealing to them than the physical features of
a store. And in many cases, the people who aren't customers can be as
important as the ones who are. One US record company analysed data and
found their largest consumers of rap techno were consumers aged over 55
who were buying for their grandchildren. The company, Camelot, devised a
mailing list, which kept this group abreast of the latest pop music and saw turn
over rise by 37%. Personal service is a big draw for older consumers so what
happens to an industry that wants to reduce its face-to-face contact with
customers? Unless they change their ways, banking and financial services to
seniors are heading for retail meltdown.
The impact of ageing eyes is just beginning to be felt in the creative process
of marketing. The implications extend far beyond issues of print size and style.
Take one simple example. As eyes age, they do not respond as quickly to
changing light conditions. When mature customers enter a store, they may
actually pass a store communication system or point-of-purchase display
near a doorway before their eyes have adjusted.
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8. BUILDING LOYALTY AMONG CONSUMERS
The growth in competition and innovation coupled with the disloyalty of the
new consumer is giving rise to ‘churn’ - the steady but constant birth and
death of brands and retailers. The greatest myth that is harming retailers
today is ‘If we sell a good product at a reasonable price- that is good
enough’. New research confirms that satisfaction does not equal loyalty with
the new consumer: every day customers who are satisfied with one brand or
retailer defect to another.
The importance of creating customer loyalty and generating new business via
existing customers cannot be emphasised too strongly. These are the
foundation stones on which some of the world's mightiest business empires
have been founded.
And it's not hard to understand why. First they offer the most powerful of all
advertisements, third party endorsement. If they are sufficiently impressed
they may even do some of your selling for you, among their friends and
colleagues. Second they are usually in the best position to know which other
companies are most likely to be interested in buying from you. Finally there is
the added bonus that such a trustworthy and enthusiastic addition to the
sales force all work for you for free! Which is one reason why converting these
leads from prospects to purchasers is highly cost effective.
Accepting that not every customer will provide new business leads and that
even the hottest leads cannot always be persuaded to buy, networking in this
way will still ensure your sales performance remains high.
Your company's culture will be optimistic, active and achieving as the result
of positive energy created through a process that I call the Law of Multiple
Effects. Customer care, like Total Quality Management, has become one of
the business buzz terms of the last few years.
Unfortunately despite the millions of words written and spoken about caring
for customers, it still appears to be far more talked about than practised.
While a survey among the marketing directors from over 3,000 top UK
companies found that the vast majority saw customer care as essential for
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9. winning and retaining customers, many paid only lip service to the concept.
Their idea of what such a programme entailed was limited and naïve, with
less than a quarter even bothering to measure customer satisfaction. More
than half cited product quality and competitive pricing as their chief priorities.
By contrast, telephone response, delivery, dealing with complaints and
training front-line staff were seen as far less significant.
Relationship marketing, designed to target specific products and services to
individual customers, was consistently rated as an "insignificant" aspect of
customer care programmes. Yet research shows neither quality nor pricing
are the chief reasons why customers take their business elsewhere.
Only 14 per cent change suppliers because of dissatisfaction with quality and
a further 9 per cent are tempted away by lower prices. More than two thirds,
however, remove their customer as a result of "an attitude of indifference" on
the part of their suppliers.
While both quality and price are extremely important, what keeps customers
loyal is being treated as individuals. The simple secret of customer retention is
customer super satisfaction.
Recent studies have shown that customers will accept two levels of service -
Desired and Adequate. The Desired level is the service customers hope to
find. It is a blend of what they believe can and should be provided. The
Adequate level is that which customers will accept without complaint.
Between these is a Zone of Tolerance. This varies from customer to customer
and, potentially, from one purchasing situation to another for the same
customer. Among the factors influencing the extent of this Zone is:
* Customer sophistication. The more a consumer knows what can and ought
to be achieved, the greater their expectations. A guest who rarely stays at a
hotel, for example, may have a lower level of expectation than an
experienced business traveller. One consumer told researchers: "As I've grown
and learned more, I now have more to compare with."
* Availability. At times of scarcity people have much lower expectations and
a wider Zone of Tolerance than during periods of plenty. "When your options
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10. are limited you take the best you can get," one consumer told me: "My
expectations are not necessarily lower but my tolerance level is higher."
* Urgency. In an emergency we expect and demand the best. If you are
taken ill for example, second-rate medical treatment is entirely
unacceptable.
* Price. The more we pay the greater our expectations for the service
provided and the narrower our Zone of Tolerance. When flying First Class
across the Atlantic you expect to be treated better than those travelling
coach.
There are two aspects to delivering any type of product or service.
The first, called the Outcome Dimension, deals with suitability and reliability of
what is sold. A customer, not unreasonably, expects his purchase to perform
dependably and in accordance with its specifications. If you buy the services
of a travel agency, you expect them to book the tickets asked for on the
correct flights and within budget.
Suppliers receive no special appreciation for satisfying Outcome Dimensions,
only criticisms if they fail to do so.
The second element is the Process Dimension. This is the manner in which a
product or service is delivered and has four components:
Tangibles - Everything your customer sees, hears or touches. They include the
appearance of showrooms, retail premises, reception and bedrooms in
hotels, plus sales and advertising literature.
Ask yourself:
Do my customers feel comfortable when they call to see us?
Are our premises attractive and welcoming?
Does the atmosphere communicate a strong desire to do business, or is it
unwelcoming and depressing?
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11. Responsiveness - The speed with which your customers needs are met and
the willingness of your staff to help. Do they go beyond what customers might
reasonably expect by providing a superior service?
Assurance - The knowledge and expertise possessed by your staff, their
courtesy in addressing customer needs and the trust and confidence they
convey to customers.
Empathy - The customers' belief that they are being listened to and
understood by the supplier. That the attention they receive is genuinely caring
and tailored to meet their specific needs.
Customers judge Outcome Dimensions only after the product or service has
been delivered. After all you can't know whether a product or service is
reliable and suitable except by using it. There is no choice but to suck it and
see.
Because customers are in a position to judge Process Dimensions (Tangibles,
Responsiveness, Assurance and Empathy) while the service is being delivered,
they are the most important factors in meeting and exceeding your customer
expectations.
Customers of firms at a Competitive Disadvantage will be disloyal and eager
to change suppliers whenever the opportunity arises.
Those operating at a Competitive Advantage enjoy a measure of loyalty but
their position is far from stable. Customers can still be lured away by
competitors able to demonstrate that they offer a higher service.
The only way to win business for life is to franchise your customers by so
consistently providing a superior service that they become virtually extensions
of your own company. Not only giving you unwavering loyalty but by bringing
in new business through recommendation. Franchising your customers
involves consistently performing at the Desired Level while seizing every
opportunity to exceed that level.
Different types of consumer will be described, from “terrorists” out to wreck
your business to the super loyal who will stay with you no matter what.
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12. New Research has revealed an array of fascinating findings about how we
shop. These findings can be used to design store floors and displays that make
consumers as psychologically comfortable as possible in order to induce
maximum purchase desire. No displays exist in isolation. People shop
differently in different types of stores, even if they are shopping for the same
product. Which is why successful marketers vary the display depending on
the type of retail outlet involved.
In what are termed “task-oriented selling environments”, such as banks,
chemists and supermarkets, for example, displays located between the point
where the shopper completes his task and the check-out are more likely to
generate impulse sales than are displays positioned between the entrance
and the task-completion point.
Once somebody has finished the task, they're willing to consider other
options, and they're moving at a slower pace.
Prescription shoppers in chemists, for instance, are often collecting medicine
for a family member, and are more likely to look for something for themselves
as they move to the check out.
Even the positioning of the front of the premises has an impact on the
shoppers’ psychology. The longer customers have to think about possibly
entering a store, the more likely they will. Research has shown that the most
important view of retail premises, bank or building society is often a side or
approaching view. The first opportunity most retail premises have to attract a
potential customer can be up to 50 yards before he or she arrives at the
doorway. On busy streets and in shopping centres progressive planners have
been allowing stores to build out their storefronts to enhance pedestrians'
view as they move down the pavement or centre concourse.
In the same spirit, windows featuring displays that the consumer can
recognise or identify with at a 20- to 25-paces are most effective in attracting
customers.
My research has also established a number of general rules concerning
window displays.
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13. First, it is far more effective to get across two messages positively than five
messages possibly. The secret here is to keep it simple. In many retail
locations, you can count on the fact that your customer base will pass your
window with a certain amount of regularity, be it twice weekly, or in some
cases, daily. Simple windows that change often may very well be a better use
of the display budget than elaborate windows that remain in place for longer
periods of time.
Another important consideration, especially for retailers dependent on
impulse purchases, is the entry point into the store. The entrance and first 10 to
20 paces into the store are the most crucial elements in forming the
consumer's perception of that business and putting them in the mood to buy.
This “entry impress zone” extends some 15 feet into a retail location from any
entrance. Shoppers enter this zone at a particular walking speed and
gradually slow down. At the same time, their eyes adjust to the lighting
conditions and their body to temperature difference between the store and
the outside.
One common flaw of store entrances is failure to plan a transition zone.
People have many different walking speeds. The pace that they move down
a rain swept street or across a hot parking area is very different from the
speed at which they move through a store.
It takes time for people to slow down once they get through the store's
entrance. Few retailers take the need for a “decompression zone” into
account, yet my research has consistently shown that displays placed close
to an entrance fail to attract much notice. It takes around 10 paces to adapt
to the store's lighting, move down through the walking gears and move into
“shopping speed."
By the time a shopper has slowed to this pace and adjusted to in-store
conditions they're have already moved past that display.
Retailers should never place anything of value in this decompression zone
because more often than not it will be overlooked. By placing merchandise
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14. at the far end of the decompression zone sales can be increased by at least
30%.
Directional/promotional signage and displays are also far more effective
when placed deeper into the store. The transition from walking to shopping
speed in the decompression zone (the first 10 to 20 feet inside the door) is
where signage is least effective.
Other common mistakes: Delivering a message that takes 12 seconds to read
at a point in a store where a consumer spends only two seconds. It just won’t
be read!
Another factor retailers must take into account is known as the invariant right.
From early infancy, for example, children will approach and reach out to
objects using their right hand more frequently than their left.
Shoppers tend to stay on the right as they stroll down shopping-centre
concourses or along the pavement. Which is why, in a well-designed airport,
travellers drifting toward the departure gate will find the fast-food restaurants
on their left and gift shops on their right.
People are prepared to cross a lane of pedestrian traffic when hungry but will
rarely do so to buy a magazine or souvenir.
This is also why retail clients should ensure that their window displays are
canted, preferably to both sides but especially to the left.
A potential shopper, approaching the store on the inside of the pavement
with the least impeded view of the store window, will be able to see the
display from at least twenty-five feet away.
Why do a majority of shoppers favour the right?
A likely explanation is that the left hemisphere of the brain controls the right
side of the body. Research has shown that this hemisphere is associated with
an approach response and positive emotions. The right hemisphere, by
contrast, controls the left hand, and this is associated with an avoidance
response and more negative emotions.
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15. REFERENCES
Ariely, Dan, and Gregory S Berns. "Neuromarketing: The Hope and Hype of
Neuroimaging in Business." Nature reviews. Neuroscience (2010)
Dagher, Alain. "Shopping Centers in the Brain." Neuron 53, no. 1 (2007)
Davidson, Richard, J. "Anterior Cerebral Asymmetry and the Nature of
Emotion." Brain and Cognition 20: pp 125-151.
Davidson, Richard J. "Cerebral Asymmetry and Emotion: Conceptual and
Methodological Conundrums." Cognition and Emotion 1 (1993)
Fionnuala C. Murphy, Ian Nimmo-Smith, and Andrew D. Lawrence "Functional
Neuroanatomy of Emotions: A Meta-Analysis " Cognitive, Affective &
Behavioural Neuroscience (2003)
Knutson, Brian, Scott Rick, G Elliott Wimmer, Drazen Prelec, and George
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Lewis, David and Bridger, Darren . “The Soul Of The New Consumer.
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Lewis, David. “What The Consumer’s Brain Tells The Consumer’s Mind – And
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