Current Responsible Retailing Research April 19, 2006 Brad S. Krevor, Ph.D. Bill DeJong, Ph.D. Joel Grube, Ph.D. Brandeis University Boston University PIRE

“ Until recently, there has been a nagging doubt that we really don’t know what we’re talking about. “Now, as a result of the work of a distinguished team of social scientists, we have proven that we really don’t know what we’re talking about.”

Attorney General Consumer Protection actions Questions about AVCs: Does a corporate policy translate into store-level behavior? Are the AVCs effective?

Attorney General Consumer Protection actions RW Johnson Foundation SAPRP award to study ExxonMobil AVC executed Aug 2002 with 43 state AGs –16,000 stores,1000 Company Operated “CORS” –¼ ly Mystery Shopper inspections

Attorney General Consumer Protection actions SAPRP award research questions 1.How well does ExxonMobil implement the AVC? method: survey of EM personnel 2.Do age-verification rates improve? method: secondary analysis of 1/4ly MS inspections Hypothesis: remedial response to failed inspection predicts future success. Also: special issues in minority areas?

ExxonMobil surveys Written surveys: 1225 sales associates 284 store manager Representing 450 CORS, of which: half at baseline had been consistently compliant, “ “ “ “ “ inconsistently compliant, Additional questions in minority areas

almost Question always + always = Total I ask for an ID = 96.5% Other sales associates ask for IDs = 95% I will get caught (for an underage sale) = 96.4% strongly agree + agree = Total I don’t want to sell to anyone too young = 98.5% ExxonMobil really cares about not selling = 96.5%

Attorney General Consumer Protection actions EM AVC questions 2. Do age-verification rates improve? Data is very problematic Pattern of increasing rates of age-verification not in evidence

Attorney General Consumer Protection actions Issues raised by EM AVC findings: 1. More training and more communication about checking IDs are not apt to improve age- verification rates

Attorney General Consumer Protection actions Issues raised by EM AVC findings: 2. What is going on that “trumps” the know- ledge and personal commitment not to sell without checking IDs? store environment multi-tasking mindlessness (crime of inattention)

Attorney General Consumer Protection actions Issues raised by all AVC findings: 3. Mystery Shopper reliability Three types of MS inspections : –Law enforcement: underage inspector –Quality assurance: legal age inspector, announced (Walgreens experiment) –Measurement: legal age inspector, unannounced

Attorney General Consumer Protection actions 3 MS reliability: compliance as function of inspectors' age MS agerate of age-verification 17– % % % % % % Data not from AVC Signatory chain (not ExxonMobil)

3 MS reliability : agecorrect age-verification 17 – % % % Assume pre-test of 50% with 24 yr-olds and 55% post-test with 21 yr-old: Improvement is illusory Assume pre-test of 80% with 20 yr-olds and 70% post-test with 24 yr-old: “drop” in age-verification is actually a significant improvement in age-verification performance.

3 MS reliability : Implications of MS age as determinant of store performance: Need to describe “…% age-verification with age … MS inspectors” Unreliability of measurements when MS age is not controlled Need to establish equivalency

Issues raised by all AVC findings: Meaning of a single Mystery Shopper inspection –Law enforcement –Quality assurance –Measurement: What does it tell about the store? Is “Fail” an event that occurs 1 in 4 times? 1 in 10 times? 1 in 25 times?

Issues raised by all AVC findings: Compliance as Probability Electronic Age-Verification (EAV) Study (2002): Data from double baseline inspection protocol B 1B2 both Florida81%86%66% Iowa43%51%33% Note: MS inspectors > 18. rates much lower than Synar results