[Image of: RetailWire Logo and Tagline (for print)]

BUSINESS TIPS

ChannelAdvisor:
Online Selling Strategies
Offerpop:
Social Marketing Campaigns
RR Donnelley:
In-Store Marketing
LoyaltyOne:
Enriching Customer Relationships
 
[7 comments]

Crowds Lead to Anxiety Spending

December 23, 2013

A new university study finds that consumers in crowded environments tend to choose safety oriented products, are more risk averse (less likely to gamble), and are more persuaded by messages that focus on the negative possibilities of inaction.

"We found that being crowded puts people in an avoidance state, where they focus more on evading problems than the potential upside," said co-author Robin Tanner, an assistant professor at the Wisconsin School of Business, University of Wisconsin-Madison, in a statement. "I don't think businesses fully realize how crowding can impact sales."

For example, marketing toothpaste offering cavity protection might work better with a safety-oriented message in a crowded selling floor rather than a toothpaste promising a whiter smile.

The study also found that the impact of crowd size is influenced by whether the consumer considers the crowd an "in-group" or "out-group." Specifically, out-group crowds — people the consumer doesn't identify as peers — lead to increased conservatism and a greater focus on safety.

The study, from professors at the University of Wisconsin-Madison University, the University of Kansas and University of Toronto, was recently published in the Journal of Marketing Research.

The was research comprised of six experiments that exposed participants to crowded or uncrowded settings, then had them complete tasks or indicate preferences for messages, products and behaviors. One experiment featured a questionnaire measuring the preference for prevention-themed concepts (like "avoiding enemies") versus promotion-themed concepts (like "making friends"). Another asked participants to do a word-search task for safety-related words (like "insurance" or "helmet") and neutral words (like "coffee"). Yet another gave participants a $10 gift card and asked them to make a series of investment decisions based on different scenarios.

The authors suggested that retailers could use digital signs to quickly change messaging and the type of products featured as a store gets less or more crowded. But they also felt the research extends beyond marketing.

"We believe this research also has potential implications for persuasion and decision making in environments as diverse as trading floors, courtrooms and political rallies," Ms. Tanner said.

Discussion Questions:

Should or can in-store retail tactics be adjusted to traffic conditions? In what ways? Do the findings around shopping behavior changes amid crowds make sense?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

Should or can in-store retail tactics be adjusted to traffic conditions?

Comments:

This sounds suspiciously like my dissertation, which showed that if you can get shoppers to feel more in control of their environment, their level of stress is reduced, and they perform better on search tasks and shopping tasks. So that was published 33 years ago (and was used in re-designing the Coop at UConn). You can increase a sense of control by making store signage very clear, having lots of registers open (self service if possible), and if you have an environment where things are difficult to find, more store help.

[Image of: View Braintrust Panelist button]
Dr. Stephen Needel, Managing Partner, Advanced Simulations

Please. I'll agree with Stephen's three decade old premise about general levels of relaxation and task management. Seems logical.

But, I go to the store because I think my teeth are too yellow to buy a whitening toothpaste, but discover the aisle is too crowded so I sacrifice my vanity in favor of battling tooth decay? I'm just not buying it.

Tell me that people who are top crowded will grab something just to get out and I'll buy it. More than that? I'm reminded of the words of the late great Freud who observed, "Sometimes a cigar is just a cigar."

[Image of: View Braintrust Panelist button]
Ryan Mathews, Founder, ceo, Black Monk Consulting

Many environmental factors have an impact on shoppers and their choices. Crowding is one of them. Just as retailers need to consider the needs and wants of individual shoppers, they also need to consider the impact of environmental factors (e.g., crowding, the weather, music, ambiance, etc.) on those shoppers. Not all shoppers will respond the same way to crowding or specific levels of crowding. If I just need an answer to a quick question or to just check out, consumers may respond to crowding differently than if they are in need of information and education before making a purchase decision.

[Image of: View Braintrust Panelist button]
Camille P. Schuster, Ph.D., President, Global Collaborations, Inc.

There are at least two trains of thought in this area. One way is to capitalize upon the fears of shoppers and offer the products and services that address those fears. Another way is to avoid the obvious "sitting duck" shoppers' fears and quell them with unrelated promotions to take their minds off of the crowded situation.

I'd like to think that more merchants will take the more positive approach and not fuel and capitalize upon the fears of those in the crowds. Hopefully. However, both approaches do sell products.

[Image of: View Braintrust Panelist button]
Ralph Jacobson, Global Consumer Products Industry Marketing Executive, IBM

So people "exposed" to crowds are "more willing to gamble," "more persuaded by negative messaging" and "more likely to chose neutral words." By the way, since when is the "coffee" neutral and "insurance" safety related? When I hear the word "insurance," I think of scams. Anyway, obviously environment effects people's shopping.

But the one flaw that I see in this experiment is that they "expose" these people to a crowded environment. People who really want to avoid crowds, will see the parking lot and just move on. Take it from someone who hates crowded stores. If they really need that tube of toothpaste, they are going to run in, buy it and run out as soon as possible. I'm not sticking around to read signs about coffee or insurance.

[Image of: View Braintrust Panelist button]
Janet Dorenkott, VP & Co-owner, Relational Solutions, Inc.

While an interesting perspective, observation may also show that shoppers want to get through the aisles as quickly as possible, so will pick up the first familiar product they see, rather than explore and compare potential choices. If products are less familiar, it's logical to think safety messaging may be influential. Shopping environment definitely influences purchase behavior.

[Image of: View Braintrust Panelist button]
Anne Bieler, Sr. Associate, Packaging and Technology Integrated Solutions

The question becomes whether the lift in changing in-store retail tactics improves the sales margins enough to make a messaging change based on crowds.

This is an interesting study and will become an easier tactic to adopt once interactive, dynamically changing POP displays and store shelves become more commonplace.

[Image of: View Braintrust Panelist button]
Karen S. Herman, Founder & Design Director, Gustie Creative LLC

Search RetailWire
Follow Us...
[Image of:  Twitter Icon] [Image of:  Facebook Icon] [Image of:  LinkedIn Icon] [Image of:  RSS Icon]

RetailWire's
Getting Started video!

View this quick tutorial and learn all the essentials...

RetailWire Newsletters