How We Sell

Despite all of the changing attributes of shoppers, are there any new developments that have actually made it easier to operate in the current retail environment?

For most retail stores, there's an absolute predictability about who is in the store and when they will be there. You can tell who's coming in and what opportunities they present. If I'm running a bookstore in a mall, I know that senior citizens come through early in the morning; stay-at-home moms shop during the day; kids come by after school; and professionals shop after work. That information ought to make it a lot easier to design retail spaces that appeal to each group at each time. For example, why not devise a rotating display facing the mall corridor? You turn it one way from 10 am to noon, rotate it from noon to 2 pm, then turn it again from 2 pm to 6 pm. You simply put different books on the display sides depending on who will be walking past.

There are a number of things that you can do -- small ideas that are fundamentally clever, that cut through the clutter, and that work. Instead of using a lot of small, clever ideas, everyone's looking for that one perfect moonstone. Here's another example of a small work of art: There's an elevator in a hotel in New York's financial district with a mirror and a sign underneath it that says something like, "You look famished." Then it lists all of the restaurant options that can be found in the hotel. It's brilliant!

There's an mtv logic here, involving the use of icons and words to get across a complex thought. It's a technique that applies the same principles to marketing that Reginald Marsh applied to the world of graphics with his giant-size murals -- that somehow there was a way in the course of one frame to get across the image of something infinitely larger. The idea of a mirror and "You look famished" uses the power of a reflective surface. A mirror has always been a magical symbol. Someone has just twisted it wonderfully.

A lot of what you've said seems like common sense. Why don't merchandisers get it?

In part, it's because the merchandising business is in a cowboy stage. It has very little accountability built in. The point-of-purchase industry is now maybe four times larger than it was 15 years ago, and, even at that, it's desperately looking for its place at the table of marketing. I had lunch today with a senior executive at McDonald's, and I asked her, "How much do you spend testing commercials? And how much do you test your merchandising and promotions?" Although McDonald's does test some point-of-purchase merchandising, it spends far more on checking commercials.

The dollars spent on merchandising crept up without anyone keeping close track. And lots of people talk strategy, but not many of them know about tactics. We've made huge strides in the past 10 years, and yet, until recently, there wasn't a major business school in the country that specifically offered a course in merchandising.

Why hasn't technology solved all of these problems?

Technology is a troubling issue, because as much as it facilitates, it also confuses. Over the past 10 years, a lot of people have knocked on our door with technology, wanting to back it into some application. Consequently, we've spent a lot of time working with technology. We found that almost all of the interactive devices that we've studied over the past decade have failed. In some cases, we have tried to apply technological solutions to human problems. And almost universally, the designers of those solutions have had an imperfect understanding of the environments that they were studying.

Time after time, we've seen merchandising approaches that involve putting computers on the retail floor -- and no one has considered that somebody on the floor has to reboot the computer on a regular basis. And it's amazing that, when ideas for introducing technology into the retail space come up, no one seems to realize that eventually any flat surface in a commercial space is going to get something spilled on it. We sell an awful lot of soft drinks in this country. Sugar water isn't good for computers -- and it finds its way into almost every store.

You make it sound as if the retail environment suffers from a number of disconnects: the disconnect between buyers at headquarters and salespeople on the shop floor, and (the other way around) the disconnect between the brand manager who designs a marketing campaign and the shop-floor clerk who sets it up in the store.

We ran a study a number of years ago that looked at hair-care products for a major American health- and beauty-aides maker. We went to different stores and took pictures of shelf sets -- what products were located where. We enlarged about 15 of those pictures for different stores, and we took those enlargements into our client presentation. Everybody went nuts over the photos! "That's not the right shelf set! We didn't pay for that! We're supposed to get 16 facings, and we have only 12! How did that brand get on that shelf? It shouldn't be there!"