Friday, October 29, 2010

Increase Repeat Customers’ Unplanned Buying

Researchers at University of Pittsburgh and Baylor University say most of your shoppers intend to spend money on impulse items.
     Before starting their shopping, study participants were asked to estimate how much they planned to spend. For more than 75% of the shoppers, the amount they thought they’d spend altogether was more than the amount they estimated to be the cost of items they planned to buy. These shoppers had prepared themselves to come across both needs they’d forgotten to include on their shopping lists and items they wouldn’t realize they wanted until the items were in front of them or in their hands.
     Unplanned purchases add to your profitability. Previous research has said you can make unplanned purchases more likely by offering noticeable discounts on items that are commonly bought. Now researchers at University of Pennsylvania, Instituto de Empresa Business School in Spain, and Tilburg University in the Netherlands have added to the tactics. To spot these, the researchers focused on a certain type of shopper—the repeat customer who has defined their shopping objectives before they enter your store. These are not idle browsers, but are instead out to buy something. The objectives could range from the general (“I’m looking for something to cook for dinner”) to the specific (“I’ll buy two chicken breast fillets”).
     Based on the research findings from 441 households and covering 58 product categories, here’s how to increase unplanned buying by repeat customers who have shopping objectives:
  • Encourage customers to set general shopping objectives instead of specific ones for their next visit. Do this in your advertising and in talking with customers at the cash/wrap (“Please keep in mind that we’re your store for every sort of party planning”). For shopping with general objectives, the jump in impulse purchases was about twice as much as for trips with specific objectives.
  • Maximize your within-store convenience for fulfilling whatever objectives the shopper has set (“I can get almost everything right at that store”). In the research, this sort of store-specific convenience lifted the amount of unplanned buying more than 10%.
  • Avoid unnecessary impressions of multi-store convenience (“If I shop at that store, it would be easy to also shop at other stores”). When your repeat customer decides to stop at a few different stores to meet their shopping objectives, they become somewhat less likely to make unplanned purchases at your store.
Click below for more:
Sell Impulse Items to Serve
Have Unannounced Discounts on Common Purchases

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