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What is meant by behavioral economics essay
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Why We Buy: The Science of Shopping Paco Underhill, the author of Why We Buy: The Science of Shopping, created a company in which he and his colleagues credited themselves on mastering the science of shopping. Big name corporations would hire him and his company to execute research in their establishments, whether it is a department store or a family restaurant, and determine how they can be more efficient in their selling strategies. Through his years of service, Underhill has uncovered incredibly insightful bits of information that have allowed these companies who get the help of Underhill to have one up on the competition. Men, Women, and children all have different shopping patterns. Through hundreds of hours of video observation, Paco Underhill has uncovered the insights and behaviors that have allowed businesses to see massive increases in profits. One of the first findings Underhill found was the idea of “butt brushing”. “Butt brushing” is the occurrence that takes place in a store where the isles are not wide enough and as a result, Paco found that people were immedia...
Levy, Michael, Barton A. Weitz, and Dhruv Grewal. Retailing Management. ed. New York, NY: McGraw-Hill Education, 2014. Print.
Over the years, the American department store has developed and evolved as not only a commercial business but also a cultural institution. While it has weathered many storms and changes since its inception and throughout history, its most predominant enemy has been a change in the lifestyle of the American people (Whitaker, 2013). As the customer’s needs and wants have shifted, department stores have struggled to keep up with demands. It has been argued that the decline of the department store has been ongoing for the last 50 years (Whitaker, 2013). This dissertation aims to understand how the department store has historically played a role in consumer culture and spending, and additionally, how this has evolved and changed in today’s retail market. Although department stores may not be able to take all the credit for inventing modern shopping, they certainly made its conventions and conveniences commonplace. They set a new standard for the way the consumer should expect to be treated, the type of services that should be provided, and the convenience that should attend the process of acquiring the necessities and niceties of life all in one place. They made shopping into a leisure pastime. This environment meant shopping was a means of freedom to look around, pick up objects with no obligations to buy. As one historian remarked, department stores: “encouraged a perception of the building as a public place, where consumption itself was almost incidental to the delights of a sheltered promenade in a densely crowded, middle-class urban space” (Whitaker, 2006). Although this perception and view of the department store has changed over the years, this paper aims to follow the trail of how and why that happened.
Companies realize what people need and they take it as sources to produce commodities. However, companies which have famous brands try to get people’s attention by developing their products. Because there are several options available of commodities, people might be in a dilemma to choose what product they looking for. In fact, that dilemma is not real, it is just what people want. That is what Steve McKevitt claims in his article “Everything Now”. When people go shopping there are limitless choices of one product made by different companies, all choices of this product basically do the same thing, but what makes them different is the brand’s name. Companies with brands are trying to get their consumers by presenting their commodities in ways which let people feel impressed, and that are some things they need to buy. This is what Anne Norton discussed in her article “The Signs of Shopping”. People are often deceived by some famous brands, which they will buy as useless commodities to feel they are distinctive.
According to the video “How stores track your shopping behavior”, from the study of men’s habit of shopping, they know how to get men to pay attention to their products. They change it up a little bit and get a really interesting result:”85% increase in product touch, 44% increase in sales, and 38% increase in dollar sales”. That is huge increase in numbers. That number shows how impactful the study is in their business performance. It is the result of understanding their customers’ needs and desires.
Paco Underhill has created a way for stores to draw more customers in and spend more money by getting in the mind of the customers. I found some of Underhill’s theories to be true. Underhill’s theories have helped provide research of the actions of consumers inside of American Eagle, Meijer and Hollister, these theories include, the need for shoppers to acclimate to their surroundings, the way customers turn into stores, and by placing most used products in the farthest places away from the
“Nothing in a grocery store is where it is by accident. Every item on a shelf has been planned” (Paco Underhill). In the articles, “The Science of Shopping” by Malcolm Gladwell and “How Target Knows What You Want Before You Do” by Charles Duhigg, these authors exemplify effective marketing strategies which were composed by Paco Underhill and Andrew Pole. Underhill is an environmental psychologist; additionally he employs the basic idea that one’s surroundings influences ones behavior and invented structuring man-made environments to make them conducive to retail purposes. Pole was a statistician and revolved his entire life around using data to understand
Why do we buy? For some of us it would be difficult to survive without the purchases of necessities. But, rather than the needs of humans, why do we buy the products that are not necessarily, well, necessary? The brands and products we adore so much have become a habit of particular interest to us. For example, if you need laundry detergent, how often do you switch brands every so often? The answer is probably never. We stick close to our hearts during buying decisions, and even then they might be unconscious decisions that we just make. Buying used to be an overwhelming task. Sifting through multiple brands, checking prices, and ultimately making a decision that fits the personal consumer on the individual level. Now, we can finish an entire shopping list in one lap
Lindstrom, Martin. Buy-ology: Truth And Lies About Why We Buy. N.p.: Crown Business, n.d. Print. All information gathered from this source.
Backstroma & Johansson (2006) wrap up their study that the retailers need to focus more on traditional values such as the behavior of their personnel, which is not captured by the retailer’s occasionally. So they find the gap that more and more attention of the retailers comes towards technology side now a days, the result is that they are ignoring traditional aspects.
The nature of the business of retailing puts retailers at a assumed risk of incurring costs because products are bought with the assumption that consumers will purchase. Additionally there are external factors that may also pose risks such as natural disasters, theft, spoilage and fire. In other circumstances retailers also extends financial credit to customers in the form of credit sales which facilitates the smooth transition from retailers to the marketplace. Retailers are in constant contact with customers which gives them the opportunity to research and study buyer’s behaviour. This involves collecting information about changes in customer preferences, perception and shifts in the demand curve. Through advertising within their stores retailers are able to exhibit and introduce existing and new products to the marketplace. Ultimately retailers are in the business of selling products to customers to achieve their goals of generating
Signs of Shopping by Anne Norton “The practice of shopping is, however, more than instructive. It has long
4. Hale, Todd. “Understanding the Wal-Mart Shopper.” Nielson Trends & Insights: Page 1. 10/19/2008 http://www2.acnielsen.com/pubs/2004_q1_ci_walmart.shtml
Shopping is something that has to be done whether you enjoy it or not to get essentials needed. We all go places where merchandize is being sold for a specific reason. Whether you go to the mall, shopping centers, or your local grocery store, you 'll always encounter many types of shoppers. Shopping isn’t always as fun as it sounds to everyone, but it is something we often do. This is the only way we get products we need, by personally buying them. You have three main shoppers including impulse buyers, list makers, and bargain hunters.
Everyone likes shopping, but everyone has their own way of spending when they go shopping. I love shopping, but I hate being at the mall, if I don’t need to be there then I won’t be there. I’ve noticed that when I have money, I do not buy anything, and when I do not have money I want everything I see. From my experience I’ve observed that there are people who shop smart, people who are just plain addicted to shopping, people who join another person while shopping, basically called window watchers.
Customers bicker back and forth on which shopping experience is better, online or in stores. A lot of customers have a type of shopping that is more convenient, and others rather stay away from in store shopping. Shopping used to be a hassle in the stores but with the newer technology shopping in the stores is so much easier than it used to be. A lot of people have thought about shopping on the internet, but people do not understand all the downfalls that come with it. The shopping experience is a type of opinion where customers debate whether they enjoy online or offline shopping, people always look at how quick and easy shopping is. Americans should continue to shop offline due to businesses improving shopping experiences, safer for customers, and can save time in the long run.