In-Store Purchasing Behavior.pptx

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In-Store Purchasing Behavior

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Merchandising Techniques

Store Layout and Traffic Patterns

Point of Purchase Media

Product Shelving

Pricing Strategies

Packaging

Brand Choice: National Versus Private

Personal Selling Effects

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Merchandising Techniques

Merchandising techniques have an important influence onconsumer shopping behavior. This is particularly true for lowinvolvement purchase decisions.

For example, nearly two out of three supermarket purchasedecisions are not specifically planned. Because there is

generally little consideration of such purchases until the pointof sale, merchandising techniques affecting the consumer inthe store are often of great significance in securing purchase.

A number of topics are discussed under the umbrella ofmerchandising techniques including store layout, displays,product shelving, pricing strategies, branding and

promotional deals.

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Store Layout and TrafficPatterns

A stores interior is organized in such amanner as to accomplish the firmsmerchandising strategy. Retailers

sometimes find however that their layoutand design approach is failing to achievecompany objectives. In such cases a newstore design may be necessary. A recentexample of such a change is Kmart.

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Point-of-Purchase Media

More than 80 % of supermarket shoppersmaking their final buying decision in thestore.

Effective combination of good store layoutand attractive displays can change ahumdrum retail environment into one thatnot only more exiting but also helpful togenerate sales.

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Some of the research had conducted thatshows the effectiveness of display in thestore. Of 2473 supermarket shoppers interviewed, 38

percent had purchased at least one brand or itemthey had never bought before.

A study of 5215 customers in supermarkets foundthat one third of had purchased at least one of thedisplayed items.

Kmart discovered a 251 percent sales increase forsports products featured on continues loop filmin point of purchase audiovisual displays.

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600

500

400 +279%

300+173%

200

100+35%

0 15% price Ad feature + In store Ad featureReduction 15% price display + and display+

reduction 15% price pricereduction reduction

+545%

+128%

+244%

+138%

BASENo trade

supportedpromo

In- store display

15% price reduction

Ad feature

Feature displaysynergy

BASE (no promo)

p

ercent

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Product Shelving

Shelf Height :- Tests conducted byProgressive grocer indicate that the mostfavorable shelf position is generally at eye

level, followed in effectiveness by waist level,and knee or ankle level.

Shelf Space:- It is crucial to be given enoughshelf space to attract the buyers attention.

Without adequate shelf facings, the items will belost in the mass of 22000 other multiple facingslining the average supermarkets shelves.

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Pricing Strategies

Price awareness: Although consumershave a critical attitude toward the generalprice level and supermarket prices in

particular, they apparently have difficultyrecalling the actual price paid for apreviously purchased product.

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Promotional Pricing: One form ofpromotional pricing involves multiplepricing, the technique by which retailers

price items in multiple quantities such as 2for 25 Rs., 3 for 49 Rs. Etc.

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Couponing: This is a form of price dealingin which a cents-off coupon is redeemed

during purchase, thus reducing theproducts price.

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Packaging

One of the most important point-of-saleinfluences is the package, includinggraphics, product information contained

on the package, and physical design of thepackage.

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Brand Choice: National VersusPrivate

For a number of years now, there has been abattle between manufacturers national brandsand distributors private brands for brandprominence in certain product categories.

Position of Private Brands: The competitiveposition of private brands differs from industry toindustry. In supermarket, taken a single brand,private label products are either first, second or

third position in over 40 percent of 476 differentsupermarket product categories.

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Generic Brands: Generic or no namebrands were pioneered by the Frenchsupermarket chain, Carrefour. These

products are easily distinguishable due totheir basic and plain packagingcharacteristics coupled with the attribute ofprimary emphasis on the contents of the

package rather than on brand name. Price is an important factor in generics

success.

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Personal Selling Effect

There are many product purchase situationin which customers interact with salespeople.

Personal selling in which a salesperson

interacts with a consumer is referred to as adyad

Researchers have begun to view selling asdynamic interaction in terms of the

characteristics not only of the salesperson butalso of the buyer, and how the two partiesreact to each other.

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The Situational nature of ConsumerDecisions

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One of the most important factorsinfluencing the choice and purchasingprocess is situation surrounding the

consumers decision. Depending on the setof circumstances faced by the consumer inmaking a purchase, behavior may take

any number of directions. Thus, consumer behavior may largely

depend on the situation.

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A situation may be viewed as comprisingall of those factors particular to a time andplace of observation which do not follow

from a knowledge of personal(intraindividual) and stimulus (choicealternative) attributes and which have a

demonstrable and systematic effect oncurrent behavior.

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Five Groups of situational characteristicsmay be identified:

1. Physical surroundings2. Social Surroundings

3. Temporal Perspective

4. Task definition5. Antecedent states

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Non Store Purchasing Processes

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Although the vast bulk of consumerspurchasing process now take place instores, there is a growing amount of in-

home shopping. Marketers usually refer tothis approach as nonstore marketing ordirect marketing.

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Significance of Nonstore Buying

According to U.S. census retail tradestatistics, in-home buying is increasinglyurban and has been growing appreciably

faster than total store sales and generalmerchandise sales for some time.

Estimates of nonstore sales buying range

from 2 to 12 percent of total retail sales.

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Why people like telecommunication based merchandising?

An increased emphasis on consumer self-identity, withindividuality expressed through goods and services, which

leads to a desire to consider more items than a store candisplay.

A higher amount of working woman who have less time toshop.

Increased leisure-time pursuits of self development and

creative expression, which follow less time to shop.

Greater demand for specialty products and services that aredifficult to get in most shopping centers.

Rapid acceptance of new technology such as VCRs, homecomputers etc.

Increased popularity of such recent nonstore innovations asto pay-by-phone, special-interest mail-order catalogs, andtelevised direct marketing.

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Why Consumer oppose to buy?:1. They like to see products in person before

they buy

2. They just dont need it.

3. They like to go out to shop.

4. They want to relax while watching TV and dontwant to push buttons.

5. They feel they might be tempted to buy products

they dont really need.6. They fear that being hooked up to a computer

will invade their privacy.

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Characteristics of in-home Purchasers:1. Upscale households with few expectations

2. Racial patterns

3. Working Wives4. Geographic location

5. Other characteristics

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In-Home Shopping Motivations

Convenience

The risk of Buying

Lifestyle Marketing Implications

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Purchasing Patterns

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Focuses on two important purchasingpatterns:

1. The extent to which consumers develop repeat

purchasing patterns2. The extent to which purchases are unplanned

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Brand Loyalty

A research suggests that an increase in

market share is related to improved brandloyalty.

Retailers concern for decrease in brand

loyalty: Sophisticated advertising appeals and heavy media

support.

parity of products in form, content andcommunication

Price competition from private and generic labels

General fickleness of consumers

Growth of new products competing shelf space andconsumer attention

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The nature of Brand loyalty:1. Undivided Loyalty: Purchase sequence A A A

A A A

2. Divided Loyalty: Purchase sequence A B A B AB

3. Unstable Loyalty: Purchase sequence A A A BB B

4. No Loyalty: Purchase Sequence A B C D E F

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Factors Explaining Brand Loyalty: Some socioeconomic, demographics and

psychological variables are related to brand loyalty

but tend to be product specific Loyalty behavior of an informal group leader

influence the behavior of other group members.

Some consumer characteristics are related to store

loyalty which in turn related store loyalty Brand loyalty is positively related to perceived risk

and market structure variables.

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The effects of out of stock conditions:

The important reason for brand substitution isan out-of-stock condition.

The result of OOS condition can effect forshort period or long period.

Customer may switch brands, shopping at

other stores, postponing purchase or alteringchoice

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Marketing implications:


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Marketing implications:

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Impulse Purchasing

The nature of Impulsepurchasing:

1. Pure impulse2. Suggestion impulse

3. Reminder impulse4. Planned impulse

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The Extent of Impulse buying More than 33 percent of all purchases in variety

and drugstore are unplanned

One-half of buying decisions in supermarkets areunplanned

Thirty-nine percent of all department storeshoppers and 62 percent of all discount store

shoppers purchased at least one item on anunplanned basis.

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Factors influencing impulse purchase:

Marketing factors influencingimpulse purchasing include massdistribution in self-service outletswith mass advertising and point-of-sale materials and prominent display

position and store location.

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In-Store Purchasing Behavior.pptx

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