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Factors That Influence In-Store Decision Making

The Inman, Winer, and Ferraro article in the September 2009 issue (“The Interplay Among Category Characteristics, Customer Characteristics, and Customer Activities on In-Store Decision Making”) offers and tests predictions on how category and customer characteristics and customer activities influence in-store decision making. It also highlights several consumer-centric strategies to decrease the likelihood of unplanned purchases.

Among category characteristics, the authors find that unplanned purchases are more likely for both infrequently purchased and hedonic product categories. Among customer characteristics, the influential variables included gender (women shoppers tended to make more unplanned purchases) and household size (greater size increased the likelihood of unplanned purchases). Finally, among customer activities, the results indicate that unplanned purchases are less likely when a list is used, when frequency of shopping increased, when customers limited the number of aisles visited, and when the time spent in the store decreased. In addition, the likelihood of unplanned purchases also increased when customers paid by credit card or by check instead of by cash.

The authors characterize the reduction of unplanned purchases as enhancing consumer welfare. While this interpretation applies in many circumstances, it is worth investigating if this is always true. It is noteworthy that display was found to have the greatest effect (among category characteristics) on unplanned purchasing. Display increased the probability to .64 from the baseline probability of .46 for unplanned purchases.

Overall, this article presents a rich set of implications from both policy and managerial perspectives. I welcome comments and reactions from JM readers in this blog thread.

Siva K. Balasubramanian, Journal of Marketing Web site Editor

Comments

The article “The Interplay Among Category Characteristics, Customer Characteristics, and Customer Activities on In-Store Decision Making” by J. Jeffrey Inman, Russell S. Winer, & Rosellina Ferraro, gives some intuitive insights about the effect of various factors on the unplanned behavior of the consumer.

It proves that where factors like effect of display, interpurchase cycle and category Hedonicity, gender of the consumer, household size, store familiarity, number of aisles being shopped at, amount of time spent in the store, paying by check or by credit card instead of cash increases the unplanned behavior of the consumer, factors like use of shopping coupon, use of list, and greater shopping frequency, reduces the unplanned shopping behavior of the consumer.

The study has significant learning lessons for both the customers and the managers. Where customers can avoid all such steps that increases his un planned shopping tendency, the manager has to be more creative and innovative in terms of store/ aisle design, and planning his marketing and sales activities to further enhance the customers un planned shopping behavior at his store.

The study also gives a very interesting insight that the consumer’s unplanned buying behavior is not affected by his being accompanied by anyone. Here we think that measuring the age of the companion would have been very handy. Because we think that although while accompanied by an companion should decrease the tendency of unplanned purchase, owing to rational decision making with the discussion with the companion, or due to fear of social shame arising out of unplanned purchase. Also we think that while accompanied by children, the tendency of unplanned purchase must increase due to pester effect, especially for hedonic category products (positive interaction effect). But as the age of the companion has not been taken into consideration, any effect because of it might have been averaged out, and hence the significance of being accompanied by someone id low in the result.

Also the negative interaction between display and category hedonicity is an interesting finding, but we think other explanations for the phenomenon are possible than the one given.

Overall, despite the limitation of being constrained to the data given in the POPAI data set, the finding is very useful as it goes a long way in educating the consumer how to safeguard them against the tendency of impulse buying.


By:-
PGPM students (Great Lakes Institute of Management)
Consumer Behavior Section 1- Group G2 - Serial Nos. 18 – 34.

The article “The Interplay Among Category Characteristics, Customer Characteristics, and Customer Activities on In-Store Decision Making” by J. Jeffrey Inman, Russell S. Winer, & Rosellina Ferraro, is an extremely interesting case of consumer behavior.

The article talks about unplanned purchases. To be able to increase unplanned purchase can be highly money-making to the retailer/ manufacturer because consumers end up buying things which were not in his/ her agenda while walking into the store. This obviously implies the customer ended up spending more money in the shop. However, the aim for any business apart from making money is to create value for its customers. Thus the main aim of the retailer should not be anyhow making the consumer spend more, but to remind him of his needs, to provide him with clues of what he might need. The consumer should not feel guilty after the shopping session. This will make him careful the next time he comes for shopping and he will curb down on unplanned spending. Thus the long-term money making objective will also not be fulfilled.

The authors have done some study of the impact of certain customer and category characteristics on consumer’s unplanned purchase. Although no correlation was found between gender and unplanned purchase, from common experience it can be said that women make lot more unplanned purchase than men, maybe because they also spend more time on shopping and are generally accompanied by someone and/ or children who increases the likelihood of unplanned purchase. Also, the article talks about store familiarity. My view is if a customer is a regular at a store, there is a far more chance of him/ her trusting the store and thus in case of little doubt, he/ she will go ahead with the purchase because of trust and relationship with the store.

All in all, it is a very insightful article and opens up a lot of avenues for both the decision-makers: the manager and the customer.

The article- Interplay Among Category Characteristics, Customer Characteristics, and Customer Activities on In-Store Decision Making by J. Jeffrey Inman, Russell S. Winer, & Rosellina Ferraro aims to provide us some insights into unplanned or impulse purchases and what drives them.

The work presented in the article is solid and original however some of the observations presented in the article do not come as a revelation to me. Recent works in the field of sensory branding /Neuromarketing ( most of it by Martin Lindstorm ) has shown that sensory branding can be employed by marketers in a number of ways to induce impulse buying. Lindstorm in his book Buyology recounts that how supermarkets have used slow relaxing music in the store for years now to make the shoppers slow down and increase the time spent in the store. By engaging more than one sense, marketers can dramatically increase the sales of their products. Some of the other tactics employed by retail stores are the following :

1. Some stores deliberately place the tag limited edition on certain brands in order to make the sales of certain slow moving articles.
2. Product placement and shelf space are recognized to be the most important aspect of retailing.
3. Some store have taken this to another level- Certain stores in the US deliberately reduce the size of the square floor tiles to increase the frequency of the clicking sounds that emanate from the moving shopping trolley. This creates a perception in the mind of the customer that he/she is moving too fast. The person appropriately slows down and the sales go up. This tactic is typically employed in aisles where the most expensive/overpriced goods are kept.
4. It has been empirically proven that when Barbie dolls are kept near expensive high end mens shirts , the sales of the dolls goes up. The reason is the guilty feeling a father gets when he purchases a luxury apparel for himself. He automatically gets the urge to buy something for his daughter to reduce the cognitive dissonance.
5. The yellowness if the yolk of an egg is seen to represent superior quality. Some companies have known to inject artificial coloring in the hens in order to make the yolks a shade of bright yellow.
6. Complimentary products have been keept next to next to each other since ages .

So we can see that most of the so called insights presented in this paper have been already discovered and implemented by many retail stores across the world. The point we all need to ponder upon is that marketers now have sophisticated techniques like neuromarketing and sensory branding at their disposal. The power of these tools is such that they can make the customer overspend without his/her knowledge. The multinationals of tomorrow armed with all these tools have access to the subconscious mind of the consumer. Since many of the purchases we do are a result of the manifestations of the subconscious mind, the whole picture somehow looks somber from the customer’s point of view.

The consumer of tomorrow has to be on his toes in order to escape from all these manipulations. The marketer of tomorrow somehow has to be kept out of our heads.

Tejas Bhatt
Roll No 9357
Group G5
PGPM Class of 2010 – Great Lakes Institute of Management , Chennai , India

Buying on credit has increased the volume of sales by many folds. Similarly other cashless buying using coupon also has had the same result. People do unplanned purchase or what is called impulsive purchase when they do cash less transaction. When money changes hands, people become aware of their spending. Otherwise they have a feeling of greater freedom to spending.

The article says display draws more attention and increases the likelihood of unplanned purchase. I recollect reading in an article which said Barbie dolls were kept in the shelves next to Van Hausen premium shirts. Whenever a person bought those shirts, he had a guilt feeing of not buying anything for his daughter while he spent so much money on his shirt and invariably bought the Barbie doll kept in the next shelf.

Women do more unplanned purchases as compared to men. As the household size increased the likelihood to do an unplanned purchase increased further. While shopping, you come across a product which might suite your bedroom or a show piece which suits your living room. You had not planned for this purchase earlier. But you end up buying the product. As women do most of the household shopping, they have a greater probability to do an impulsive buy.

The article also rightly points out that unplanned purchases are less likely when a list is used, when frequency of shopping increased, when customers limited the number of aisles visited, and when the time spent in the store decreased. This article from a store manager’s perspective will help him in organizing his store items and allocating suitable shelf space to suitable products to increase purchase. While from a consumer’s point of view, he can limit the extent to which he makes unplanned purchase.

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