• From retail to airports: why we ...

    Martijn Steur

    4 months and 2 weeks

    From retail to airports: why we need new questions (and why we have to ques

    Why we do what we do: in truth we don’t have a clue. We think we know what we’re doing, that we are reasonable, clear and rationally thinking creatures. But we are not.

    And as this inconvenient truth goes for all of us Homo sapiens, it also goes for whatever and whoever we become, from business leader to president, from bank manager to scientist. However much we learn on our way from being yolo youngsters to mature adults, most of the decisions we will make in out lifetime are made without a true clue as to why.

    Decision making guesswork

    Are we merely guessing ourselves through life? After reading Daniel Kahneman’s book “Thinking, fast and slow”, you are tempted to say so. Together with Amos Tversky, Daniel Kahneman’s research made him point out a painful conclusion: humans are not exactly knowledge based decision makers. Kahneman is psychologist, but won the Nobel Prize for economy for uncovering the myth of the “Homo economicus”.

    The two psychologists discovered “systematic errors in the thinking of normal people”: errors arising not from the corrupting effects of emotion, but built into our evolved cognitive machinery”. As human beings we are in fact more flawed than we are willing to admit.

    “We run this company on questions, not on answers”, Eric Schmidt (CEO Google)

    We tend to deny it; the irony being that one of our flaws is that we are also very confident about ourselves. We are convinced other smokers will die of smoking, not us. We are sure nothing will happen to us when we ski off-piste past the avalanche warning signs. We know for certain that we will earn back the millions that will go into our shopping mall and others will not.

    Working as a consultant in the airport industry, I too have to admit much of the decision-making leans heavily on data. We have gotten used to growing numbers of passengers and increased sales of our retail business. Maybe because of that, retail professionals have started to think of shopping in terms of product of what we buy. They think categories, segments, audiences, target groups, spending power and such. That all seems so logic. But is it? Or is it what we like to think it is?

    New happiness, new questions

    All his life Daniel Kahneman has been driven by this theme of human irrationality. After Tversky died he applied his curiosity on the subject of “hedonic psychology”: the science of happiness, its nature and its causes.

    He feels there is a problem with the word happiness, believing it actually has two different meanings.

    One is momentary pleasure—for example, the happiness someone might experience every time they wear a designer outfit or drive a new car.

    The other is life satisfaction. If someone has had the goal for a long time to always be on the cutting-edge of technology, being the first to have an in-home mixed reality system will bring satisfaction-driven happiness.

    "We think of our future as anticipated memories". Daniel Kahneman

    Researchers at two U.S. universities conducted studies about the happiness associated with consumer products *1. That research framed happiness in terms of "wanting what you have" versus "having what you want."

    Pleasure from “wanting what you have” implies that it is derived from use, creating happiness in the moment. Happiness results from experiencing what they bought. People who want what they have more than others do tend to be happier.

    Pleasure from “what you want” implies that a goal preceded the acquisition. Happiness results from satisfaction derived from accomplishing the goal. People who have more of what they want than others do also tend to be happier.

    Thus, happiness does not come specifically from the objects we buy. It is an emotion associated with our motivations for making those purchases. The question that is interesting to ask: are the malls, high street locations and airport retail areas built with this knowledge in mind? Suppose your whole airport is built around the shopping experience while for most travellers the peak end memory is more important to rate your airport as a happy place - wouldn’t that be a motive to rethink the lot?

    Too much what, too little why

    In my meetings with airport executives around the world, happiness has never been a topic. It never gets mentioned as a possible motive for spending money on material goods. Happiness, why should we discuss something like that? But in all probability, it may be high time that we start at least asking questions about the very why behind shopping at airports. Come to that, even about the why behind flying and traveling.

    “The future is not what is used to be” Paul Valéry

    “Companies are run on questions, not on answers”, said Google CEO Eric Schmidt and if that was true some years back, it is even truer today. New insights will start arriving the moment we have the courage to say that we could be wrong in out optimistic paper plans, based on paper research and sunny paper forecasts.

    Change your questions

    In the case of an airports response to changing consumer behaviour, the questions should perhaps not be: What new shop do we need to bring? What online assortment should we have? What should IT be doing for us? What do people think when they arrive in our retail area? What shops do they like most?

    Ask instead: what is our role, exactly? What do we offer? Why do people fly? Fun, adventure, broadening their horizons, purely business? What role does shopping play in this at all? Come to that, why do people shop? Do they want more things or are they bored? Do they have money to spare of are they spending without thinking of tomorrow? What kind of happiness are they after? The experience kind or the memory kind?

    Question the answers

    So we asked these questions and a thousands more. We have written up the answers and questioned those again. We have come to a conclusion of some sort. Great. Can we move on now then, please? No. Still more new questions.

    Do we still build the shops we where planning to?

    Do we still build shops like we always did?

    Do we still build shops at all?

    Do we still want to expand airports with more shops?

    Do we still see our airport as a shopping mall or as a great place to fly?

    Do we still think people are happy because of our airport shops?

    Do we still build airports as expensive as they have become?

    Do we still think shopping at airports will bring in the profits forever?

    It never stops. There is no easily found happiness for the decision makers who are really trying harder to find the right answers. Because the answer may be that there is no right rational answer to build our really big decisions on. That we will always be playing the guessing game.

    The moment we accept that, at least we may have reduced the percentage of having no clue. And we may just be right in deciding to do what we want to do, while hoping for the best.

    Because, after all, “The future is not what is used to be” (Paul Valéry).

    *1 http://www.nytimes.com/2011/11/27/books/review/thinking-fast-and-slow-by-daniel-kahneman-book-review.html

    About the author:

    Martijn Steur is an experienced commercial manager, consultant and entrepreneur specialised in strategy development and execution.

    With a 15+ year background in developing High-Traffic Locations in as many different countries he has established a true global view.

    He is a Certified Experience Professional – a practitioner and consultant on the strategic and tactical ways to help organisations improve their customer experiences and build their business.

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