The Games Companies Play
Consumers are trained to buy, even when they don't really want to. Companies have developed a range of strategies, from quickly rotating merchandise to infusing stores with certain scents and sounds, to get customers to spend more than they would otherwise. Fueled in part by a growing mound of research that suggests consumers are responsive to such tactics, more and more retailers are turning to them. Within the past 18 months, "it really got legs in U.S. retail," David Van Epps, chief executive of ScentAir, says of scent.
At Zara, the Spanish-owned clothing store, the turquoise and beige tunic on sale one day will be replaced by a yellow ruffled sundress the next. If you want the tunic, you have to buy it now, instead of waiting for a sale. According to the company, stores' entire contents are turned over every three to four weeks, and new clothes arrive twice a week.
"They're training their customers to buy an item if they see something they like, because next week it might not be there," says Robert Swinney, a doctoral student at the University of Pennsylvania's Wharton School. "That way you get people to buy at full price." Swinney's research, based on mathematical modeling, suggests that profits can be boosted by an average of 67 percent with such a strategy.
Kit Yarrow, professor of consumer psychology at Golden Gate University, says that the quick-rotation strategy has the same disorienting effect as midnight madness sales and one-day specials. "They're training [consumers] to purchase even though they may not be ready," she says. "If people are buying for fear or anxiety that it won't be available, then they're less likely to make good purchasing decisions."
H&M, which also relies on the rapid-turnover strategy, says it is just satisfying customers' desire to stay on top of fast-changing fashion trends. Plus, adds company spokeswoman Lisa Sandberg, "prices are affordable, so it's OK" to buy something if you like it.
Companies including Sony and Westin Hotels & Resorts employ a range of smells to spur spending. Sony Style stores, which sell the company's consumer electronics, puff a sweetish scent with citrus bases and vanilla overtones into the air. "They wanted to appeal to a female buyer more intimidated by electronic items," says Van Epps of ScentAir, which helped Sony develop its secret formula.
Christine Belich, Sony's vice president of visual merchandising, says that it's not possible to connect the scent directly to a boost in sales but the goal is to create an enjoyable shopping environment where customers want to linger. She adds that the scent was designed to appeal to both men and women. (The scent can be quite subtle—it could hardly be detected on a recent visit to the Sony Style store at Pentagon City Mall in Arlington, Va.)
At Westin hotels, guests are greeted with an earthy, musky scent called White Tea, which was designed for the company. Amy Heilgeist, director of guest experience, says Westin created the scent to help guests feel renewed as soon as they arrived. Like Sony's Belich, she says it is impossible to link the smell to an increase in bookings, but she adds that Westin has already sold out of the 10,000 units of White Tea available through its retail arm.