This text was extracted from a Time Magazine cover story of 2August99
Attention All Shoppers
You may not be aware of it, but the air around you is filled with subtle advertisements and marketeers are watching every move you make
REPORTED BY DESMOND BUTLER, HELEN GIBSON AND KATE
You’ve just disembarked from a long and exhausting flight, and are still waiting for your onward connection, so the smell of freshly cut grass and the tangy scent of the sea are invigorating. But you’re not reclining on some tropical beach sipping a strawberry daiquiri. In fact, you haven’t even left the airport. You’re in the British Airways business class lounge at Heathrow, and the fragrances you’re savoring have been specially created to enhance your comfort. “It’s all about making people feel refreshed and uplifted,” says Jamie Bowden, BA’s media relations manager, of the designer aromas wafting around the room. And, of course, it’s all about encouraging you to book your next flight with BA, too.
While the customized olfactory environment in the BA lounge is not an advertisement in the traditional sense, it is one of the new ways that advertising agencies and corporations are trying to influence purchasing decisions. The average person is bombarded by thousands of ads each day: on walls, on floors, above urinals, on baggage carousels and the backs of ticket stubs, at cinemas and ATM machines.
Given this surfeit of marketing messages, consumers have become adept at editing out those ads that don’t immediately grab their interest. For companies eager to establish a brand or promote a product, the customer’s attention is becoming an increasingly scarce, and therefore increasingly valuable, commodity. Marketeers are responding by employing science and technology as the new hidden persuaders, invisible levers that can be used to track spending habits, target advertisements and build customer relationships. The result: advances in fields as diverse as biology and computing are enabling advertisers to get up our noses, inside our heads and under our skins.
There are about 400,000 odors in the world, each one of which can influence mood and behavior. It has been shown, for example, that extracts from male sweat can affect the regularity of a woman’s menstrual cycle. But aromas can also help induce consumers to spend money, and many companies are experimenting with the new science of smell to create optimal shopping environments. “When the air quality is pleasant, so is the shopping experience,” says Diotima von Kempski, whose Dusseldorf-based company, D.V.K., designs scents and ventilation systems for retail clients in Europe, Asia and the U.S. “If people feel good, they buy more.”
Brewed from roots, herbs, flowers and fruit, Von Kempski’s fragrances entice customers to linger, giving the retailer a larger window of opportunity in which to make a sale. “It has to be natural, not artificial,” Von Kempski explains. “The strongest effect comes when the fragrance is barely discernible.” Bernd Bleicher, manager of Walz Modehaus, a posh clothing chain based in Ulm, is convinced that smell sells. “There’s a prickly freshness in the store that puts customers in the mood to browse,” Bleicher says. “[The scents] create conditions conducive to serious shopping.”
Retailers in the U.K. have got wind of the link between smelling and selling too. B.O.C. Gases in Guildford, Surrey, has carried out a number of commercial scent experiments for clients. It has tried out the bracing aroma of newly washed linen for Thomas Pink, the famous shirtmakers in London’s Jermyn Street, and tested the fragrance of fresh leather in the showrooms at a car dealership. “We’re trying to create a particular environment rather than influence people directly,” says Duncan Roberts, B.O.C.’s sales and marketing manager. Interest in made-to-order odors is growing, Robert says, and companies have even approached him regarding the creation of “corporate smells” to go along with their corporate logos.
Paul Fitzgerald thinks the whole thing stinks. “Why is all this necessary?” asks Fitzgerald, a coordinator with the Manchester-based anti-consumerism pressure group Enough. “One-fifth of the world’s population already consumes over 80% of the natural resources. This technology is just going to add to the problems.”
Even George Dodd, research and development director at London-based Kiotech International, a biotechnology firm specializing in smells, has his doubts. Six years ago during the Christmas shopping countdown, he carried out an experiment in which a blend of pheromones–smells that can induce specific behaviors–were circulated through the basement of one of London’s largest department stores. Sales in that department were monitored, and Dodd and his colleagues observed that shoppers lingered longer–and consequently spent more money. “Having done it,” he says, “I’m not convinced about the ethics. You are being assaulted by a chemical and not getting a choice.”
Dodd’s doubts haven’t stopped Kiotech from test-marketing Excite in northern England. Aimed at 18 to 25-year-olds, Excite is a “pheromone sachet” that is daubed on the body like a perfume. Its function: to arouse the interest of potential sexual partners. The product has generated a lot of excitement on the club scene: available through vending machines, it’s been outselling condoms four to one. While Kiotech caters to wild young things in dance clubs, Karl-Reiner Lassek and his colleagues at Duke Werbeagentur, an advertising agency in Saarbrucken, concentrate on “well-off older people” entering their golden years. “Europe has around 115 million people over the age of 60,” Lassek says. “This is an enormous market…but the advertising industry is fixated on the youth cult. The elderly have a lot more buying power–if you can find a way to tap into it.”
Lassek has found a way. Step into the Age Simulator, an elaborate second skin that allows the wearer to feel, hear and see exactly what it’s like to be a senior citizen. The Age Simulator is a kind of high-tech Halloween costume: thick padding around all body joints makes bending and stretching difficult, while a stiff neck brace restricts head movements; large earmuffs simulate partial hearing loss; and the Empathic Lens, a photographic lens that blurs vision, replicates failing eyesight. For marketeers, the Age Simulator is a revelation, allowing them to see the world through their customers’ eyes. “When we go with our clients through a shop, they are amazed at just how much effort shopping is [for the elderly],” Lassek says.
This insight into the experience of old age allows Duke’s clients–which include Pharmacia & Upjohn, the German Post and May Milch, a manufacturer of dairy products–to better assess the effectiveness of their marketing plans and design their premises so that shopping is less strenuous.
Stefan Ewerling, manager of the Globus department store in Saarbrucken, more than 20% of whose customers are over 60, changed the layout of his shop after personally testing the Age Simulator. Shelving was rearranged so that the elderly don’t have to stoop and Ewerling created six “peace zones” where senior citizens can take a break. Some other wisdom that has come of the Age Simulator: most elderly people don’t see well enough to make their way through a confusion of colors and styles, so keep displays clear and simple; and lighting should be soft and diffuse, because bright fluorescent bulbs tend to disorient and deter older shoppers.
The Age Simulator makes clear how crucial it is for companies to understand their customers. Such an understanding enables advertisers to build a lasting relationship between consumers and specific brands. And relationships are important because regular customers are hundreds of times more profitable than one-time buyers. That’s why advertising in the age of the Internet is getting up close and personal. “The cutting edge now is the use of computers for one-to-one marketing,” says Patrick Barwise, director of the Future Media Research Programme at the London Business School.
“Know thy customer” is the guiding philosophy behind Massachusetts-based Engage Technologies, which offers digital media buyers the very stuff of life: a database containing profile information on 30 million Web users, one-third of all Americans online. “Engage believes that he who owns the best data wins the game,” says company president Paul Schaut. “I turn that into: He who owns the knowledge of his customers wins the game.”
Engage’s Knowledge software provides access to the company’s enormous database, which is compiled by tracing a person’s digital footprints across the Web. The Knowledge system catalogues which sites a person visits and how much time he or she spends there. Using this information, Knowledge builds a profile of that person, detailing what his or her interests are and for what kinds of products he or she might be a likely target. After rendering the profiles anonymous by stripping away the names, Engage breaks them down into 22 categories–including automobiles, books, pets and finance. Corporations can then use this information to customize products, target ads and tailor their websites to specific groups.
Some see micro-targeting such as this as one more way to better serve the needs of consumers; others see widespread potential for abuse. Privacy on the Internet is difficult to protect, since a digital record is left of every move one makes. “When you go online, it’s like you have a little camera on your shoulder…watching everywhere you go,” says Austin Hill, president of Zero-Knowledge Systems in Montreal. “With this kind of universal tracking mechanism…people can associate your patterns across multiple sites.” Which in practice could mean something like this: if one site asks for your postal code, another wants to know your date of birth and a third requires an indication of your income, a firm you’ve never heard of could obtain your name and credit history, for example, without your ever having offered this information.
DoubleClick, an online profiling and advertising firm, recently announced the purchase of Abacus, which maintains America’s largest database of mail-order catalogue purchases. The combined punch of these two firms will enable advertisers to more precisely target their messages. But whereas other online profiling firms promise to keep their databases anonymous, DoubleClick has said that it will name names.
Profiling companies like Engage and DoubleClick, Hill maintains, keep personal profiles but “say, ‘Trust us. We won’t abuse your privacy.’ We don’t put a lot of confidence in solutions that are based on ‘Trust us.'” Instead, Hill safeguards the security of private data on the Web through his company’s Freedom software package, which was released last month in a test version. Freedom allows Internet users to surf the Web anonymously by directing all commands through Zero-Knowledge Systems’ website, freedom.net, where the information is encrypted and users are given digital pseudonyms. Commands are then rerouted through different servers, the encryption technology rendering them completely anonymous. Such privacy assurance, Hill believes, will be worth a lot to the world’s netizens.
While Zero-Knowledge Systems may offer Internet users the freedom to protect their privacy, other applications of computer technology will still require a lot of old-fashioned trust. When I.C.L., an IT services company in Dublin, examined how it could make shopping easier, the company quizzed shoppers about what they hated most. The answers are not surprising: queues, crowds and the inability to find specific products. But how to eliminate these banes of the harried consumer? You guessed it: the intelligent refrigerator.
In collaboration with Swedish domestic appliance maker Electrolux, I.C.L. came up with a smart fridge equipped with a computer with a keyboard and touch-sensitive screen. The fridge is so intelligent that it can access your e-mail, check your bank account and handle automatic payments, as well as offer video games and interactive television. Oh yes, it can order your groceries, too. Running low on milk? Need another loaf of bread? Just pass the barcodes on the packaging across the fridge’s built-in scanner and it will automatically transmit the order to the supermarket of your choice, which can then deliver the items to your door.
Tesco, Britain’s leading supermarket chain, has even developed a portable scanner that slips easily into a pocket. “Instead of sitting down with reams and reams of product lists,” explains Russell Craig, a Tesco spokesman, “the handheld scanner enables you to go round your cupboards, your neighbors’ dustbins, or whatever, scan the barcodes of what’s in there and plug it into your computer, which will then order it for you.” Say you’re at a nice restaurant enjoying a particularly fine bottle of wine. Just whisk your scanner across the barcode, plug it into your fridge when you get home, and the computer will search its database of 150,000 Tesco products to determine if that wine is available.
Sounds great. No more endless shopping lists, no more running to the corner store in your bathrobe. So where’s the threat to privacy? Just as on the Internet, every purchase or inquiry made through an intelligent fridge leaves a trace. By examining a customer’s buying patterns over time, companies can learn about individual preferences. If you have a customer loyalty card, then your local supermarket already knows about your tastes. If you regularly buy pasta sauce, for example, you might find yourself targeted with ads from leading brands. If you drink only decaffeinated coffee, you might receive a sudden windfall of two-for-the-price-of-one offers.
Advertising works by presenting a range of competing pitches, prices and products from which shoppers are free to pick and choose. If a product is no good, then no amount of micro-marketing or sweet-smelling pheromones will make it a success. It may be reassuring to know that no matter how rapidly technology progresses, the golden rule of retail never changes: the customer is always right. But that other maxim of the marketplace–caveat emptor–will become more important than ever. If these technologies enhance consumers’ freedom of choice, fine. But if shoppers want to protect that freedom, they should keep a wary eye, ear and nose on the new high-tech hidden persuaders.
–NOBLE/LONDON AND PEGGY SALZ-TRAUTMAN/BONN