smart spending

American spender is new 'biggest loser'

Jay MacDonald Can't get enough of "The Biggest Loser" and other weight-loss reality TV shows?

Bestselling author Paco Underhill believes we're all about to undergo the home version of fat camp.

Step on the scale, America. Then give us 50 push-ups.

"The American consumer has woken up and realized that their debt is too big, their car is too big, their house is too big, their belly is too big and somehow they have to go on a diet," Underhill says.

What's more, the man who has been called the Margaret Mead of shopping says the change is going to do us all a world of good -- at least in the long term.

In the short term? Well, no pain, no gain.

The charismatic Underhill went from New York City retail anthropologist to founder, president and CEO of Envirosell, which today advises many of America's top retail, food, financial and consumer brands.

Underhill's groundbreaking 2000 bestseller, "Why We Buy: The Science of Shopping," told us more about our unconscious decision-making than we know ourselves.

Remember the old joke that begins, "A guy walks into a bar..."?

Underhill's practice begins with, "A guy walks into a store...."

‘Greatest reset’ in a century

Underhill doesn't underestimate the impact that the ongoing turmoil in our economic system will have on shopping.

"It's going to be the greatest reset in the past 100 years," he predicts.

But in Underhill's view, the "great reset" was not only inevitable, it may have been necessary to move us beyond voracious overconsumption to rediscover how shopping fits into the meaning of life.

"The American concept of value is undergoing a fundamental transformation," he says.

"The American merchant has been addicted like heroin to the idea of the sale. As a result, Americans have no understanding of what full price is. As we look at the convergence of being able to walk the aisles of Best Buy and comparison shop on our mobile phone for the same product being sold online, we have a fundamental restructuring of the concept of what value is."

As our concept of value resets, Underhill predicts a new phenomenon will emerge: trading up.

“The American concept of value is undergoing a fundamental transformation.”

"It's not keeping up with the Joneses," he explains. "It's recognizing that four of one thing may trump 12 of something else. It's about having fewer but better things. I have this rule: For everything that I bring in the front door, I have to take three things out the back door."

Which leads us to my new favorite Christmas tale: "Paco's Cashmere Socks."

"Last Christmas, I asked my family to give me cashmere socks; I wanted blue and black cashmere socks. It meant that some of them got me one pair of socks; that's all I wanted from them.

"But I ended up with a bunch of cashmere socks, and I went to my sock drawer and every pair of tube socks that I had from Wal-Mart over the last three years got thrown out. You know what? I'm wearing a pair of cashmere socks now and my feet feel great. I'm loving it."

I want Underhill's socks, too. Don't you?

Shoppers vs. shareholders

According to Underhill, the short-term forecast for retail is almost certainly grim. A lot of store closures are inevitable for at least the next six months.

But he predicts the survivors will reinvent themselves into a high-tech version of the old general store, offering both retail and online shopping, as well as a delivery portal for online goods.

The shopper, not the shareholder, will once again rule.

It's a silver lining Underhill offers in this winter of our financial discontent, and one that seems to fit nicely with our national awakening to the need for infrastructure and alternative energy.

"The lesson that the present economy gives us is that conspicuous consumption is no longer acceptable," Underhill says. "I hope that what we're going to see on the other side of this is a much more responsible consumer who is conscious of the political, social and ecological consequences of their consumption."

Imagine the possibilities. Underhill has.

Veteran Bankrate contributing editor Jay MacDonald lives in Austin, Texas. If you have a comment or suggestion about this column, write to Bank Shots.

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