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Eye on Psi Chi: Spring 2019

Eye on Psi Chi

Spring 2019 | Volume 23 | Issue 3


Why You Buy, With Paco Underhill

Joseph Dycus,
University of Tennessee at Chattanooga

View this issue in Digital and PDF formats.

Have you walked into a store and experienced a bit of sensory overload? Colors fill your field of vision. Theatrical lighting makes those apples look so much better in store than they will look in your kitchen. There’s a pleasant aroma in the air that starts your saliva glands working. And there’s a faint melody coming from the speaker system of an old favorite tune. None of this is done on accident. Paco Underhill would tell you that every aspect of that store has been planned to make you want to buy.

Over the course of 35 years, Underhill has risen from a graduate student in Urban Geography to the CEO of a global retail consulting company, Envirosell. His career choice was decided in the summer of 1974 in a lecture hall at Columbia University in New York, where the eminent American urbanist William H. White gave a lecture about public spaces, and how to measure their effectiveness. As Paco remembers, “I walked out of that lecture knowing what I wanted to do for the rest of my life. White basically turned the engine on and it’s been up and running from that moment forward.”

Underhill has made a name for himself by carefully observing the habits of shoppers and the trends of the shopping world. Some factors have stayed constant, but others have changed dramatically since he started his research in the mid-1980s.

One consistent truth throughout the decades is the importance of customers actually interacting with the product that they’re considering buying. This is something that many researchers ignore when they take the myopic view of shopping, which Underhill says is “the very poignant issue of people walking in the door, walking in the aisle, standing in front of a product, picking it up and putting it back on the shelf, and not buying it.” Too much retail research is focused on success and not failures.

Underhill started in the field of shopping with a fascination for two different things, “First of all is how do I watch what happens.” The second is knowing what can you do with that information to make a difference. Over the past 35 years, Paco and his team have used more than one thousand different measures to decipher shopping behaviors. Envirosell, his firm, is a testing agency for prototype stores and bank branches with assignments in 46 different countries around the world.

“Everything in a store, fast food restaurant, bank, or airport is done for a specific reason. The idea of what do I put next to what, what is on what shelf, where are the signs, what information is on the signs, to what degree am I making lighting choices? Somebody has thought through all of those details with the intention of presenting something in the best possible light,” he explains. “It is an endlessly fascinating meeting of art and science.”

The Changing World of Online Shopping

Shopping trends continue to evolve since Paco got his start in the 1980s. The Internet and visual media are altering how people view the world, “Our visual language is now evolving faster than our spoken and written word, thanks to movies and the Internet. How we fundamentally see things and process visual information has changed drastically over the last 25 years.”

This quickly evolving visual language has even changed Maslow’s famous “hierarchy of needs,” according to Underhill. “Connectivity" has joined Maslow’s hierarchy of needs. If I took away your phone, you’d be devastated. And just like warmth, nourishment, and sex, connectivity is highly important, and we can see it all around us.” Underhill doesn’t have to go far to see an example of this dependence on connectivity. He sees it every day: “When I look out my second-floor office window in New York City, it seems that half of the people walking down the street are staring into their phones.”

However, Paco is hesitant to anoint full-time online shopping as the future of retail. As he explains, only 10% to 15% of all sales currently happen online. Although online shopping will be an integral part of the future, Underhill points out some of the limitations of online shopping, saying that “a limited number of American families can accept an online purchase at their home or at their office during the working day.”

This can be a problem in big cities like Underhill’s stomping grounds of New York City, “If you live in NYC and you don’t live in a doorman building, then there is no way for someone to put a box at your front door that will be there when you get home. The same is true with a lot of suburban settings.” Paco notes that “we have to recognize 40% of people moving through a shopping mall have done some preshopping online.” The role of the internet and our phones in how we consume information is continuing to evolve.

Therefore, Paco believes that, rather than online shopping being the “end-all be-all” of shopping, it can be the first part of a process. He says, “we are accessing information online, and that information could be about a product, or it could be about pricing. And we are using that to be able to quantify our decisions. If you look at the online merchant, how many online merchants are now opening brick and mortar stores? Part of what they’re letting you do is see, touch, hear and smell, and it is the fulfillment that happens online.”

Another issue that Paco grapples with is the changing roles of women in the modern world. This requires a huge shift in the retail world because “we live in a world that is historically designed by men, managed by men, owned by men, and yet our most important customer is female. The idea of what makes something female friendly is a critical issue to the design strategies of the 21st century.” He points out that “we are all living a multitasking life, particularly women, who are often mothers, wives, and workers. How do we understand it, and what is the effect that time has on people’s behavior?”

According to Underhill, as technology becomes a more integral part of Maslow’s hierarchy of needs, retailers will have to adjust to the differences in psychology when it comes to how men and women view the same piece of technology. Underhill says “one of the things that we work on for many of our merchant and technology clients is how to sell technology to women. That’s because women tend to be less interested in how something works, as to what the impact of it is. So it’s less about what it is as a technology and more about what it is as a tool.”

The Globalization of Shopping

Another issue in modern retail is the war between being appealing on a global level, while also still staying relevant on a local level. Underhill says that this is because “the way that someone shops in Stanford, Connecticut, and the way that someone shops in Albuquerque, New Mexico have some differences.” Those differences lead to the following question, “What do we understand as national or universal, and what do we understand as local, and what are we going to do with that information?”

He frames it like this, “if you had the choice between drinking a beer that was made in your own hometown, and drinking a Miller High Life, which one would you take? You would pick the local beer and support your local economy, wouldn’t you? I think that’s one of the things that has many of the global giants quaking in their boots. It is ‘How do I get global but also stay local?’”

Paco lectures frequently at universities around the world, from Yale to the Tokyo University and places in between. The topics of these lectures vary as he tends to “move from talking about shopping malls, to talking about shopping, to talking about retail. Somebody gives me an assignment, and I work on it. I believe in edutainment, that if I can make people laugh, then I can make people think.” As for advice for aspiring young people who wish to follow in his footsteps, or just want to make a name for themselves, he has the following advice: “Every profession has a front door, a side door, and often a back door. You often need to go to a big city and put yourself in the way of chance. Only by getting in the way of chance will you find something that takes your passion and skills, and take you somewhere that you’d never imagined you would go.”

Join Us to Explore the Endless Applications of Psychological Science in the Real World!

The theme for SWPA 2019 in Albuquerque, New Mexico this April is Psychology: From the Lab to the Labyrinth–Bridging the Gap Between the Highly Controlled Conditions of the Laboratory and the Uncontrolled Conditions in the Real World. What a challenge! When I first heard this theme, I immediately thought of psychological scientists and practitioners struggling to connect the science of the laboratory to the art of practice while maintaining the integrity of the science. This small group of committed translational scientists have developed fantastic psychological technologies.

However, as I continued to ponder this theme, I could not get past the fact that the work of the translational scientists is not the typical route for psychological principles to move from the control of the lab to the busy streets of the real world. Rather, professionals in marketing, business, economics, entertainment, healthcare, law, politics, and technology are exposed to psychological concepts, apply these concepts to their work domain, and then these applications penetrate and permeate throughout their fields. Psychological science is now integrated into almost all aspects of the human experience by this transmission through working professionals.

In seeking a Distinguished Lecturer for the Southwestern Region’s Psi Chi programming at SWPA 2019, I wanted a professional whose work demonstrated the indirect transmission of psychological research from laboratory to labyrinth and whose work provides ideas that can impact the way we conduct psychological science in the real world. Because so much of our science enters the real world through the translation of these professionals, I wanted to represent their work at our conference.

I immediately thought of Mr. Paco Underhill, CEO of Envirosell, Inc., and author of Why We Buy and Call of the Mall. For me, Paco Underhill’s career exemplifies the 2019 SWPA theme. Mr. Underhill built his company on the application of research methods, direct observation strategies, and psychological principles. His analysis of consumer behavior in the real world including grocery stores, malls, and online shopping is systematic, data driven, and built on a desire to understand the myriad of factors that influence consumer behavior. Mr. Underhill’s work demonstrates the power—and the challenges—of taking psychology from the laboratory into the real world. I hope you will join us at the convention this year to discuss this fascinating and important subject!

Shawn R. Charlton, PhD
University of Central Arkansas

Paco Underhill is the son of an American diplomat and grew up across the world. As someone with a stutter he relied on his eyes to look, process, and understand the changing world he lived in. He was sent home to an American boarding school, Milton Academy, to finish high school. His undergraduate degree is from Vassar College, but he also attended Columbia University and Ehwa University in Seoul, Korea. Why We Buy—his first book is out in 28 languages and is used in both design schools and MBA programs across the world. He and his Turkish wife live in New York City. As the CEO of Envirosell Inc., he spends at least 120 nights a year on the road.

Copyright 2019 (Vol. 23, Iss. 3) Psi Chi, the International Honor Society in Psychology

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