Thursday, August 20, 2015

Space Out for the Hoity-Toity

People are attracted by the sight of a crowd, yet consumers aren’t necessarily more likely to select items from crowded locations in a store. Researchers at University of Pennsylvania who tracked the paths and purchases of grocery store shoppers found that social density exerted a pull, but once the shoppers arrived, the speed of market basket expenditure additions slowed considerably. It might be because items are more difficult to get to when there’s a crowd around or because the fascination of the crowd draws attention away from the shopping task.
     Researchers at University of Kansas, University of Wisconsin–Madison, and University of Toronto have also explored the effects of social density on consumer decision making. One major effect they uncovered was a retreat to safety. Shoppers who encountered crowds of unfamiliar bodies preferred to shop for their headache relievers at a pharmacy than at a convenience store. In casinos, crowding moved typical gamblers toward less risky wagers. Lower risk taking cuts into enthusiasm about making big purchases.
     Another reason for lower market basket totals in crowded areas is that sparse social densities lead consumers to higher estimates of prices and increased willingness to pay those prices. In verifying this, researchers at University of Wisconsin-Madison and University of Kansas discovered how one motivation was the assumption of consumers that if there are fewer shoppers in a store, those shoppers are more likely to be hoity-toity—people with money, prestige, and selectivity. Hobnobbing with the hoity-toity away from the hoi polloi—the common people--carries value.
     If you intend your store or areas of your store to appeal to those with money, prestige, and selectivity, give shoppers enough space to stretch out. Similarly, space out the merchandise so that no shopper must touch any other, or even ask for permission to pass, when reaching out to lift an item.
     It might seem that allowing all this room for merchandising the high-profit-margin items isn’t wise, since you’ll be able to show only a limited number of them. However, a whole stream of consumer research has found that scarcity also leads to higher estimates of prices and increased willingness to pay those prices. In addition, researchers at Columbia University and University of British Columbia find that shoppers in less spatially dense surroundings are less demanding of variety in the types of items and in the brands of items offered to them.

For your profitability: Sell Well: What Really Moves Your Shoppers

Click below for more: 
Form Crowds Into In-Groups
Offer Scam-Free Scarcity
When Space is Tight, Show Product Differences

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