Meddle with the Shopping Trip Middle

The price sensitivity of a shopper changes over the course of the shopping trip. Researchers at University of Kentucky and University of Groningen report that the nature of the change depends on whether the individual wants to keep to a tight budget. Budget-focused shoppers are more willing to buy higher priced options in the middle of their trip than at the beginning or as they are finishing up. On the other hand, shoppers not focused on a strict budget become relatively more price sensitive in the middle of the trip than at either end. The difference shows itself most clearly when there are a number of items being purchased and when the person is aware or made aware of the cumulative total of their expenditures as they shop.
     This phenomenon is useful to retailers who can assess whether the shopper is a budget or non-budget shopper and then track the shopper during the trip. As to the shopping trip trajectory, the salesperson asking the shopper, “What will you be looking for today?” allows that salesperson to determine what is the middle of the sequence. As to judging whether this is a budget or non-budget shopper, the choice among alternatives early in the purchase sequence is the evidence. For the budget shopper, suggest upgrades, add-ons like extended service contracts, and partner items toward the middle of the shopping trip. With the non-budget shopper, make those suggestions toward the end.
     In circumstances where a shopper intends to purchase one item on the trip, not a bunch, you might think the shopper with the budget would usually spend less money with you than the one without a budget. Surprise! Researchers at Brigham Young University and Emory University find that making a purchase with a budget in mind can lead the shopper to spend more if the budget is for one item.
     Say your customer has decided to spend no more than $150 on a mobile device. He sees price points at $80, $120, and $160. Sticking to the budget, the customer eliminates from consideration the $160 alternative. Because of how a consumer’s brain works, the result is that product quality and the inclusion of extra features become relatively more important and item price relatively less important. The customer is now more likely to select the $120 model, if it’s higher quality, than if budget wasn’t in mind at the time of choice.

For your success: Retailer’s Edge: Boost Profits Using Shopper Psychology

Click below for more:
Downgrade Free Upgrades
Upgrade Your Upselling
Check Back for Complementary Add-Ons
Consider Matching Brand Effects
Make Extended Service Contracts Worthwhile
Hang In There for Impulse Buying on Budget
Flow Shoppers into Extra Purchases
Drive Toward Quality via Budgets
Know How Shopper Fungibility Functions