8. Three Moments of Truth and Three Currencies

“If we will not buy, we cannot sell.”

—U.S. President William McKinley

A few years ago, Guinness worked with ID Magasin, one of Britain’s leading retail research and design companies, to improve its sales. They created in-store displays designed to stop customers and get them to buy. To analyze behavior, researchers filmed thousands of customers visiting the beer, wine, and spirits aisles, and interviewed a large sample afterward. Selected participants wore point-of-focus/eye-mark recorders, which record the precise point-of-focus of the eyes. This provided quantitative data on penetration and conversion rates and the nature and duration of consumer interaction with the category. It also enabled understanding of the search and selection process and established the draw of the various elements of the displays.

Exhaustive analysis of the findings indicated principles to improve in-store visibility. Based on these, Guinness created a prototype fixture and installed it in test stores, as shown in Figure 8.4. The extruding fins were highly visible, ensuring that the offer would reach shoppers at the end of the aisle. The fins also broke the linear nature of the aisle, helping to stop shoppers by the display. Product layout was clear and authoritative. All these elements were within the cone of vision. Strong brand block and the use of signpost products reduced visual “noise,” strengthened impact, and acted as guides around the fixture.

Guinness monitored checkout scanner data in the test stores. It then modified the design in response to these findings and installed the display in various retail sites. Guinness then installed the new display in ten sites and identified another ten control sites for a formal test.

The new fixture increased sales dramatically. Why? The new display was able to pull customers through the three moments of truth: reaching, stopping, and closing the sale. The fixture made stout easier to find in this busy category, so the display reached out to shoppers. The time until the first customer interaction decreased from an average of 38 seconds to 11 seconds. The majority of stout purchasers went straight to the fixture, so it did a better job stopping them in front of the display. The total average visit time was reduced from 2.08 minutes to 1.53 minutes, indicating that the new fixture was easier to shop from. U-turning in the middle of the aisle halved, to only 24%. More customers were now shopping the whole aisle. And, finally, these customers bought Guinness in much higher numbers. In the test stores, Guinness draught sales increased by 25% in value and 24% in volume. Total stout sales grew by 10% and total beer sales by 4%.

Table 8.1 shows the three moments of truth in the shopping process. As indicated, there are parallels between these three moments of truth and the concepts of exposures, impressions, and sales in advertising. The retail experience is similar to an advertising-rich environment. Note that this table includes both shopper “presence” and shopper “vision.” This is because the eye has a crucial and parallel role in what happens in the store. Indeed, vision is the immediate motivating force behind shopper behavior, as discussed next.

Vision research offers insights into this process. Distilling what we have learned from two point-of-focus methodologies, mobile and fixed, some general principles emerge that describe the purchase process, as follows:

It is really fast!

Category complexity leads to visual blindness.

If the shopper can’t find or see the products, they are unavailable.

Poor merchandising and communication make it difficult to find products.

Shoppers navigate using signpost brands.

Eye-focus level is three to five feet.

Shoppers rarely do the math in the store; price does not register.

Shoppers have been trained to shop on deal.

Gondola ends increase sales, but the opportunities are rarely maximized—a strong “call to action” is needed.

Most in-store communication, both promotional and corporate, is not seen by shoppers.

Shoppers will read very little while shopping; instead they respond to colors, shapes, and images.

Shelf edge is the most powerful location for communication.

Finally, research has shown that shoppers scan horizontally more than vertically (two-thirds of our eye muscles are designed for horizontal movement) and that when standing at a fixture, we work horizontally within a vision cone of about 5 feet (1.5 meters). However, visual attention is drawn by vertical strips when we are traveling (which is why fins such as those used by Guinness work), because this attracts peripheral attention. Most research tests show that horizontal is stronger than vertical blocking unless the vertical blocks are of a sensible width (that is, 3 feet or about 1 meter).

Not everything the shopper sees in the store is for sale. This is a mixed blessing because although shoppers need a break from solid commercial activity, time spent in these areas is definitely not spent shopping. A typical supermarket that accrues a total of 20 million exposures from all shoppers, per week, averages out to about 300 exposures per item per week across a total of 10,000 to 20,000 shoppers per week in the store.

There is a bigger waste factor, as we have discussed—the time shoppers spend traveling through the store. This is where vision becomes critical. Shoppers do not wander around the store with closed eyes and then open them to see where they have arrived. They do not teleport to their new location. The eye leads the body like a pilot. In fact, to understand shopping, it is helpful to think of the shopper as a pair of eyes mounted in a head, with the rest of the body acting as a servant to work the will of the brain. Because 90% of the sensory nerves entering the brain come from the eyes, the eyes not only rule the shopping process, but they also, in reality, rule life.

This has profound implications when trying to understand shopping by measuring bodies around the store. Whereas the body passing through an aisle may come within “reach” of all the categories in the aisle, at any given point the eyes are exposed to only about one-fourth of what is within reach (an elliptical cone, as shown in the left side of Figure 8.6)—unless our shoppers have eyes in the backs of their heads. That is why we always give consideration not just to counting shoppers, but also to taking note of their orientation and direction in the store, as well as the amount of time being spent. Again, at any give time, shoppers have the potential for 360-degree orientation, but at any given instant, they only realize about a quarter of that potential.

The right side of Figure 8.6 illustrates the relationship between physical reach and exposure to vision. The parallel dashed lines represent a typical seven-foot-wide store aisle. The six-foot radius sphere (labeled “reach sphere”) represents the physical reach of the shopper, whose eye is in the center of these spheres, facing up the dashed-line aisle. Most people’s peripheral vision extends to about 180 degrees, but the far edges of that peripheral vision best detect things like color and movement, not detail. The resolution of images occurs more accurately in a 90-degree range centering around the line of sight. For comparative purposes, the 20-foot radius sphere (labeled “vision sphere”) is a fairly convenient scanning radius for the eyes. To understand the shopper, we use eye tracking to learn more about the shopper’s vision (see the sidebar, “How Eye Tracking Works”). We have analyzed these moments of the sales and purchase process in minute detail, ultimately in fractions of seconds, to understand how quadrillions of shopper seconds add up to $15 trillion of annual retail sales.

Everywhere the shopper turns, there are commercial messages—typically packages—competing for attention. Even in a short trip, the shopper is going to be “offered” thousands of different items. The actual selection of an item for purchase, including the shopping part, often requires just a few seconds per item. So, actual shopping and purchasing happens at blazing speed.

The point of focus is the prime mover for engagement of the shopper, but the point of focus is selected from the entire field of vision, large parts of which never come into specific focus, but are nevertheless received and processed by the brain. And, of course, the point of focus shifts around quite freely as the observer scans and takes note of this or that. We need to make a clear distinction between exposures and impressions. Exposure is what happens in front of the eyes, and an impression is something that goes on in the brain—or to put it more succinctly, exposure is what you see and impression is what you look at. In that sense, everything in the field of vision is exposed to the shopper, but only the point of focus makes an impression. This line of thinking is very important when one begins to make a distinction between the shopper’s entire field of vision—what they had an opportunity to focus on or were exposed to—versus what the shopper looked at—which items actually made an impression.

Beginning with a purchase, we can back up to what the shopper focused on at the exact point when they selected the item for purchase, and back up further than that, asking what they focused on before that, and before that. When we are thinking this way, and when we recognize that all those points of focus were selected from the field of vision, it becomes increasingly valuable to ask what did the shopper not look at, which they might have.

Table 8.2 is a direct tabulation of various media that appeared in shoppers’ fields of vision in a specific store—without any consideration of the specific points of focus. For the store represented here, we report not only the share of shoppers being reached by each media point, but also the number of seconds the average exposed shopper sees the media during their full shopping trip. Notice that they are seeing the media (because it appears in their field of vision), but that does not mean they are looking at it, which would require tracking their point of focus. So, these are exposures, not impressions.

This table reveals exactly which visual media (including store staff) are actually being seen by shoppers as they proceed through the full shopping trip. Reach is simply the percentage of shoppers who at any point in their trip “see” the designated media by having it appear in their field of vision. For frequency, we used the total number of seconds that “reached” shoppers see the media. In terms of measuring impact, the total seconds per shopper are almost certainly a better measure than how many times they see it.

Based on these data, you can see that there are nine different media that are seen by at least half of the shoppers, with the lion’s share of that exposure going to end-aisle displays and the free-standing product display racks. Possibly surprising is the impact of the in-store flyer and the staff, both of which get a lot of attention in terms of the total seconds/shopper. For the flyers, even though only one in five shoppers carry them around the store, their frequent, short references to the flyer add up to a lot of exposure. For the staff (not including checkers), few shoppers are exposed, but the staff tend to be in view for a long time—presumably during interactions.

There is no point in thinking about media in the store without considering the package. All media competes with all other media in the store, and not only does the package feature in two of the top three areas of greatest impression—end aisle displays and free-standing product display racks—but also in center-of-store aisles, 80% of visual impressions are packaging.

In addition to measuring individual exposures, we can compute the probable field of vision from the path that shoppers walk. The head usually faces the same way as the body, and the eyes almost invariably face the same way as the head. It would obviously be more desirable to measure the point of focus and field of vision of shoppers, but the practical reality is that we can measure full-trip points of focus for only a few shoppers in any given study, and can measure the fields of vision for a few hundred. By contrast, we can measure the locations and orientations of tens of thousands and have, in fact, measured the full trips of millions. This means that we can use path and shopper position data to compute reliable estimates of actual exposures.

One practical application of this is determining the relative exposures that every endcap (end-of-aisle display), or other types of displays in the store, receives. Often this analysis is confused with simply counting the shoppers who pass by. But it is so much more than this, taking into account as it does the position and orientation of all the thousands of shoppers who come within eyesight of the display, their distance from the display, and the amount of time they are there. Figure 8.7 shows the exposure all the endcaps in this store received. The bigger the circle, the higher the exposure. The endcaps at the back of the store (top of diagram) receive little exposure, whereas the largest exposure is at the back of the produce section.

A study of breakfast cereal purchases illustrates the difference between exposure and impression. The results for nine stores in the study (see Figure 8.8) show that in one store (B), 73% of shoppers were exposed to breakfast cereals, the highest exposure rate of any of the nine stores in the sample. Yet only 8% of all the shoppers in that store purchased a breakfast cereal, nearly the lowest share across all of the stores. The shoppers in the store saw but did not look. They had more exposures but fewer impressions that led to purchases.

Although there is variability from store to store in terms of share of baskets purchasing a given category—cereal, in our example—the reality is that the share of baskets with category purchases is relatively constant across stores. In this case, about 9% of baskets contain a cereal purchase across this series of stores, across the United States, across chains. To be sure, some sell more and some sell less, per basket, but the relative constancy of category sales is a reflection of the constancy of crowds. Although there will be differences, any 100,000 people will behave pretty much as any other 100,000 people will, at least in terms of cereal purchases (and for most other categories, for most of the time).

In Store B, many people were exposed to cereal, but this did not affect the percentage that made purchases. As any magazine advertiser knows, the opportunity to see (OTS), while easier to measure, is quite different from actually seeing. Magazine buyers have the opportunity to see every ad in the issue, but will typically only see a few, and pay attention to (“look at”) an even smaller subset. David Polinchock, chairman of Brand Experience Lab, comments about the Wal-MartTV network: Although they claim to have 140 million viewers a week in their stores, “What if this study showed that they really only have 2 million engaged [italics added] viewers?”¹ There is a big difference between 140 million exposures and 2 million impressions. End-aisle-displays, other free-standing product displays, and the in-store flyers (weekly circulars) receive the most exposure in the store. It is not surprising that 30% of all store sales come off end-aisle displays. On the other hand, we have found that even very limited exposures can be highly effective in producing sales.

Admittedly, the line between reach and stopping can be hazy. At what point does a person go from being exposed to something, to being engaged with it? If you want to decide this from a scientific, analytic point of view—which we do—then time is what distinguishes visiting from shopping, because if you take a visit and add time, you have shopping. Time converts a visit to a shop, whatever other behavior may occur. Looked at from the point of view of the product, stopping power is what converts a “visitor” to a “shopper.”

This transition is again a matter of degree. Stopping can mean a “California stop,” as when motorists roll through stop signs slowly, or a full stop. A momentary pause may indicate that some element of “shopping” has occurred. But is a momentary pause adequate? Before addressing that question, let us recognize that measuring the amount of the time involved here is measuring “holding power.” As in Goldilocks and the Three Bears, too much holding power is not good, and likewise for too little. It needs to be “just right.” We can also divide holding power into two subcategories: “buy time,” which is the holding power, however long that may be, which results in purchase, and “dwell time,” which includes the time that both purchasers and nonpurchasers spend on the products, display, or category.

In this context, the array of choices presented to shoppers is critical. The typical retailers have no conception of what it costs them in lost opportunity when they jam up their stores with tens of thousands of “choices” that are largely irrelevant to their shoppers. Stew Leonard’s chain cuts the Gordian knot by eliminating all but 2,000 items in his supersized store. That may seem radical, but it is eminently reasonable from the shopper’s perspective. Remember, the shopper is only going to buy up to 400 different items in an entire year. This means that Stew Leonard is giving the typical shopper, on average, five options for every item they buy. This represents a massive reduction in selection angst for the shopper.

For some people, this selection angst may not be too large of an issue. But as Swarthmore College professor Barry Schwartz points out in his book, The Paradox of Choice, there are two kinds of people—maximizers and satisficers. Satisficers have some level of performance that they require when they make a choice, and as long as the product meets their expectation, they are satisfied, without spending a lot of time worrying about whether something else might be better.

Maximizers, on the other hand, always want to make the best choice. Giving them lots of choices can overwhelm their decision system and lead them to either not make a decision, or fret with dissatisfaction over whatever decision they have made, on the grounds that, with all these choices, there must have been a better option. This is not theoretical: Shoppers have been shown, under parallel test conditions, to buy ten times more from a limited selection than from a large variety. Dr. Schwartz describes an experiment involving product demonstrations at matched stores: “In one condition of the study, 6 varieties of the jam were available for tasting. In another, 24 varieties were available. In either case, the entire set of 24 varieties was available for purchase. The large array of jams attracted more people to the table than the small array, though in both cases, people tasted about the same number of jams on average. When it came to buying, however, a huge difference became evident. Of the people exposed to the small array of jams, 30% actually bought a jar; only 3% of those exposed to the large array of jams did so.”²

As Dr. Schwartz observes, “A large array of options may discourage consumers because it forces an increase in the effort that goes into making a decision. So consumers decide not to decide, and don’t buy the product.” In this case, fewer choices led to ten times as much purchase! This surprising result confirms what we have seen in the aisles of store after store: Fewer choices lead to higher sales. A passive retailer simply waits for each of these moments of truth to happen, whereas the active retailer understands all three and works with the shopper to expedite them. While the abundance of the long tail may attract customers to the store, this experiment demonstrates how the presence of the long tail in the aisle may impede sales. The retailer that can identify the right six products to sell, rather than burying them in the entire set of 24, can sell significantly more of the products.

Most retailers focus a great deal of attention on the money part of this equation, ignoring the other two currencies. Many observers see the retail transaction as, simply, the shopper gives money and receives a product. Given this view, it is not surprising how retailers used the data from electronic checkout scanners in the 1970s, which opened the way for massive and relatively accurate measurement of the money and items exchanged, the two most obvious of the shopper’s inputs/outputs. In fact, two of the largest research organizations in the world, IRI and Nielsen, are founded on the business of compiling the counts of these two variables and metering them out to both retailers and suppliers, for a healthy stream of profits.

For many years, great numbers of retailers used scanner data for little more than totaling up the shopper’s payment at the checkout and for inventory control: monitoring the flow of goods through the store. It is especially significant that this data is summed up at the store level and compiled on a weekly basis. Weekly totals are hardly the kind of detail that might be required in terms of understanding actual shopper behavior in the store.

To understand the moments of truth, we need to look beyond collective data to the individual experience of a single shopper. Individual data for this purpose does not even exist in the weekly roll-ups that are provided by Nielsen and IRI. It is not just shopper identity that is required, but also the detailed log of those shoppers’ every single shopping trip and every single item purchased on those trips, which delivers the value. (Better to have all the detailed data for a few shoppers, than all the pooled data for all shoppers.)

Although some stores are measuring customer satisfaction through surveys outside the store, this recalled experience does not always equate with the actual experience in the store.

Because we know quite a bit about the money side of this equation, we will focus on insights about time and angst.

Time is an opportunity to sell, but not a sale in and of itself. As we saw in the previous example of breakfast cereals, there is a difference between time spent moving around and looking versus time spent buying. Based on a variety of research studies, it is apparent that it takes about a second for a shopper to actually take note of a stimulus, whether of a package, a product display, or some other media. This means that one second of one shopper’s time is a pretty good basis for measuring how much shopping is going on. Hence, as noted earlier, shopper-seconds are the basic unit of shopping. Retailers commonly compute the turnover of cash per square foot or meter. This is certainly a useful and valid measure of the productivity of the real estate. Why wouldn’t we want something to tell us the productivity of their use of an asset of far greater value: the shoppers’ time? In fact, it is not too great a stretch to say that many retailers know a good deal more about the management of real estate (and inventory) than they do about the management of shoppers. One can succeed in retailing with this situation because it is self-service, and shoppers are expected to manage their own shopping experience.

To become actively engaged with the shopper, it is necessary to understand how shoppers are spending their time in the store—or, perhaps more accurately, understand where shoppers are spending their time in the store. The reason for this is so that, rather than waiting passively for shoppers to find their way to the merchandise they need, we can actively understand their needs and make relevant offers to them to expedite their purchases.

This is a crucial concept. Instead of frustrating shoppers by trying to “build basket size” by holding them in the store longer and hoping they will buy something more, we will build basket size by getting more merchandise into their baskets more quickly. The simple fact is that, in the long run, holding them in the store longer will mean that they won’t be coming here so often. Because, in the long run, whether they put words to it, they will come to realize that you are not being as helpful as your competition.

But there is a very important point to add: Most shopper behavior is not driven by the location or arrangement of merchandise! In fact, a very large share of shopper behavior in the store is not driven by the merchandise. As we noted before, only a minority of the shopper’s time is actually spent in the direct acquisition of merchandise. The role of active retailing is to identify this economically unproductive time and to do more selling during that time. Simply attempting to increase shopper time in the store has counter-productively led to fewer shopping trips, of shorter duration.

Another way to look at this is that, instead of trying to lure shoppers to where they are not, learn where they are (and where they are going) and merchandise to that, as we discuss in Chapter 9, “In-Store Migration Patterns: Where Shoppers Go and What They Do.” But of course this active retailing will begin with knowledge of just where the shoppers are spending their time. It is shopper knowledge rather than product knowledge, the latter being the specialty of most retailers and their suppliers.

Retailers are driving sales to new heights by moderating choice angst, offering a more limited selection of items. But there is a related angst issue in most stores: “Where is the ...?” We refer to this as navigational angst. And there is no question that navigation can create significant frustration, whether it is navigating the shelf visually or finding one’s way around the store. There are at least five ways to reduce navigational angst, as follows:

Design the store and lay out the merchandise in a logical and intuitive way.

Provide signage or other navigational aids to assist the shopper.

Reduce the size of the store to reduce the need for navigation.

Remove visual barriers so shoppers can see the whole store.

Eliminate or reduce path options.

The first two of these seem reasonable, but are sometimes violated with a deliberate strategy to cost the shopper time, in hopes of translating that into sales. Making shoppers spend more time looking for merchandise and less time buying is never a good idea. It reduces overall sales for the store and significantly increases navigational angst on the part of the shopper.

This brings us to a criticism of a great deal of shopper and retail research. It is simplistic, depending on data and tools readily at hand; consequently, the focus is on the easy, not the important. Paraphrasing a professor’s criticism of a student paper: “The parts of shopping research that are easy are not important, and the parts that are important are not easy.” Understanding the money part of the shopping experience and the products sold is as easy as tallying up register receipts and tracking inventory. But understanding other currencies, and how the three moments of truth lead to sales, is a more complicated proposition. We need to observe and study shoppers to understand their true behaviors in the store, where they are experiencing angst from choice or navigation, where they are investing their time, and whether that time is leading to sales. This approach can also help in improving sales forecasts. To understand how they spend their time, we need to understand the difference between time spent in the three moments of truth: reach, stopping, and closing. We can then look for opportunities for encouraging shoppers to spend more time buying and less time getting to the sale. This requires hard data on shopper behavior—each of the moments of truth and the three currencies—but gives us a much more accurate assessment of what is going on in the stores and the strategies that lead to profits.

2. What is the role of vision in shopper behavior? What is commonly known from vision in-store research about how consumers make purchase decisions?

3. What is the difference between exposure and impression? How does this relate to the concepts of navigation and selection discussed in previous chapters?

4. What are the most effective visual stimuli in the store that achieve the most exposures? What does this knowledge mean for retailers and brand managers?

5. Describe the difference between maximizers and satificers. What implications do these different traits have for the purchase process in the store?

6. Name the three currencies shoppers bring to the store. Why does the author consider time to be an important currency? What information can a retailer learn about shopper behavior in-store by using time measures?

7. Describe the currency of angst. How can retailers reduce navigational angst?

2. Schwartz, Barry. The Paradox of Choice: Why More Is Less, pp. 19–20, New York: Harper Perennial, 2005.