Are There Better Ways to Drive Unplanned Purchases?

Discussion
Oct 14, 2013

A new university study around drivers of unplanned purchases found ample opportunity for grocers to increase impulsive buys or at least drive higher-margin ones.

The findings were based on in-store video tracking to observe grocery shopping from the shopper’s point-of-view in conjunction with an entrance survey of purchase intentions. The study found:

  • Unplanned purchases tend to complement planned purchases. For example, a shopper who plans to purchase cheese is more likely to consider an unplanned purchase of sour cream.
  • Shoppers who reference coupons or in-store circulars or interact with the store staff when considering a product that’s not on their shopping list are more likely to purchase the product.
  • Shoppers who stand closer to the shelf are more likely to make unplanned purchases.
  • Promotions are effective in convincing consumers to consider a product, but they do not significantly affect a consumer’s decision to purchase that product.
  • Consumers typically leave room for unplanned purchases in their mental budgets.

In a statement, Sam Hui of the NYU Stern School of Business and a co-author of the study cited a number of ways retailers could further convert shoppers from passive browsers to buyers.

"One tactic is to position categories with high-profit margins closer to the store entrance, so shoppers see the items before their budget for ‘extras’ is depleted," said Prof. Hui. "Another strategy for store managers is to distribute store circulars and/or coupons, not only at the entrance, but also at different in-store locations, so that shoppers are more likely to take advantage of them. Offering product samples or highlighting certain store displays that encourage shoppers to stand physically closer to the shelf is another good tactic."

Co-authors of the study included Jeffrey Inman at the University of Pittsburgh’s Katz Graduate School of Business, Yanliu Huang at Drexel University’s LeBow College of Business and Jacob Suher at the University of Texas at Austin.

In your experience, what are some of the most effective methods for driving unplanned purchases in-store? Which retailers have particularly creative incentives to support unplanned purchases?

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16 Comments on "Are There Better Ways to Drive Unplanned Purchases?"


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Bob Phibbs
Guest
8 years 7 months ago

Basic retail – put the wants, the high profit, the new at the front of the store.

I would think you could encourage customers to stand “closer to the shelf” by not having the floor drops of product making a trip down the aisle an obstacle course.

Frank Riso
Guest
8 years 7 months ago

Tie-in items worked for me during my store level management days. If strawberries were on sale, I would place cool whip and pastry shells near them in the produce department. We always had chocolate syrup near ice cream, and meat spices in or near the meat case. These are just some small examples of tie-in items that seem to work well.

Tony Orlando
Guest
8 years 7 months ago

The Deli Bakery is huge for increased sales. Sampling of our new soups and specialty items helps drive sales every day, and the success rate is high if done properly. In and Out displays of hot seasonal shippers do well, as long as the pricing is right.

Front-end snacks, especially healthy alternatives do well, and local wines are everywhere in higher traffic areas, to make a statement for travelers.

Sidewalk events and tent sales for larger stores do great, and just having associates on the floor available to answer questions is a bonus as well.

Jason Goldberg
Guest
8 years 7 months ago

Mobile has really been a game changer for impulse purchases at the cash wrap. Instead of noticing all the attractively merchandised impulse items at the cash wrap, shoppers are heads down in their mobile phones.

So serendipitous discovery has to come earlier in the shopping experience than it used it. Cross-merchandising impulse items around high-traffic destination items vs. at the cash wrap, for example.

Cathy Hotka
Guest
8 years 7 months ago

Tastings are important; it’s all about the experience. Shoppers who have no plans to purchase chicken sausage may just buy it if they get a sample. That’s especially important to the working mom who wants a little variety but doesn’t have a lot of time to explore in the store.

Raymond D. Jones
Guest
Raymond D. Jones
8 years 7 months ago

Our research suggests that retailers have many opportunities for unplanned or impulse purchases based upon:

1. Shopping interruption by placement of impulse items in high traffic locations.
2. Presenting solutions by location of related or affinity items together.
3. Offering discounts in the form of special prices or coupons.
4. Placement of impulse items at wait points such as the checkout, deli, or pharmacy.

Of course, it is important to select the right items for impulse locations. Our research suggests that categories with high penetration, high frequency of purchase, and expandable usage work best.

Ian Percy
Guest
8 years 7 months ago

There are far wiser and more experienced minds than mine commenting here…but most of the advice seems rather fundamental. In response to a RW item a few days ago, I threw out the phrase “Intentional Congruence.” Seems to me that applies here as well.

What I’d like to read if, anyone can help, is the impact of price point on unplanned or impulse purchases. I don’t see that mentioned so far other than a vague reference to coupons.

Bill Hanifin
Guest
8 years 7 months ago

Having a product expert in a visible, high-traffic area could help increase sales. Offering product samples with cooking advice might trigger sales of fresh proteins, etc.

Robert DiPietro
Guest
8 years 7 months ago

This example of putting high profit margin items closer to the entrance so consumers buy before the budget is spent, seems like old school retail. My local Market Basket grocer does this routinely and you have to navigate dump bins of high margin specials! No different than specialty retailers putting ‘dump bins’ of high-margin impulse items around the store – who doesn’t need another pack of binder clips?!

Ralph Jacobson
Guest
8 years 7 months ago

Inundation of messaging is one of the best ways to drive (almost “force”) purchases. Circulars throughout the stores are fine. However, one of the best examples of driving impulse purchases was when a great grocer put their private label cookies (only one SKU, by the way) on the most prominent end cap in all stores for thirteen weeks, that SKU became the best selling cooking in Chicago by the end of the promotion, beating all national brands.

Mel Kleiman
Guest
8 years 7 months ago

Of all the ideas posted, I still see sampling as one of the best ways to drive increased sales. When people take samples, they often feel they need to do something in return for the free sample – like buying the product offered.

Tom Redd
Guest
8 years 7 months ago

Frank has the strongest way – tie-ins. There are still many retailers that just ignore this tool for added sales. DIY shops have also been slow to adopt this. Yes, it does require more store personnel hours to support strong tie-in programs, but they work and work very well.

From The Redd household, Tony O is on the money with the deli side of things. We were “pulled” closer to the deli via in-store promos and now are deli regulars. If the right products are being promoted with taste tests, you can have dinner while you shop!

Tom…eating at the store tonight….

Jonathan Marek
Guest
8 years 7 months ago
What’s interesting about the tactics mentioned is that they all either cost money, use scarce resources (placements within store), or both. The question is: is the juice worth the squeeze? Sampling is a great example. Clearly, for some retailers it works so well it becomes part of the brand in consumers’ eyes. I can’t imagine going into Trader Joe’s without seeing what the day’s sample is. My kids adore Costco because of the samples. A couple years ago, I had a client that saw that and said “look how well those retailers do… we need to have samples too!” They tested a broader sampling program, but it just didn’t work. Sure, sales increased some, but not nearly enough to pay for the labor and product cost. And the program didn’t stick in shoppers’ minds as anything special. What works for some won’t work for all. Still, kudos to them for testing. In fact, they should have been testing dozens of these techniques in a programmatic way, so they could figure out which of these tactics… Read more »
Ed Rosenbaum
Guest
8 years 7 months ago

Tony speaks from experience and hard knocks. I agree with his analysis.

Lee Peterson
Guest
8 years 7 months ago

Here’s what Whole Foods does, which I think is Best in Class: they’ll take a single type of wine, with a single type of cheese, with a single type of cracker, and let you taste them right next to a ‘power’ display of the three products together.

This is not rocket science, it’s Visual Merchandising 101 – be the editor! Select the perfect combo of goods and place them together. I can’t tell you how many times I’ve bought 3 or 4 things I had no intention of buying under the spell of that fundamental system. (regardless of category) And since Whole Foods does it all over the store, I would have to say it’s working with quite a few other people as well! I wanted a wine, but now I’ve got a perfect little vignette to impress my special someone with.

Of course, it helps to completely trust the brand.

M. Jericho Banks PhD
Guest
M. Jericho Banks PhD
8 years 7 months ago
Contrary to some comments here, it is not more effective to drive unplanned purchases by putting the wants, the high profit, the new at the front of the store (I assume that “wants” are staples). If this were true we’d find the fresh meat and deli departments repositioned in new refrigerated cases in the fronts of stores. Instead, as most supermarkets do, the high-traffic items are positioned at the backs and perimeters of stores in order to force shoppers to walk by impulse items on their way to grab the stuff on their lists. A basic tenet of grocerydom is to run shoppers by as many linear feet of shelf space as you can. Impulse sales should take advantage of the fact that 70% of purchase decisions are made at the shelf. Fresh, frozen, and packaged impulse items are best merchandised in their own departments or cross-merchandised with complimentary items. That’s why shortcakes are displayed next to strawberries. For many, buried inside this topic about unplanned purchases is the assumption that these items are mostly… Read more »
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