PROMOTIONAL EFFICIENCY AND THE INTERACTION BETWEEN
BUYING BEHAVIOR TYPE AND PRODUCT PRESENTATION FORMAT –
EVIDENCE FROM AN EXPLORATORY STUDY
Franz-Rudolf Esch, Joern Redler and Tobias Langner
Justus-Liebig-University
Track: Personal Selling and Sales Management
Keywords: sales promotion, planned purchases, unplanned purchases,
impulse purchases, POP-displays
Abstract
We report the findings of an exploratory study on the interaction between buying
behavior style and product presentation. The results, which are compatible with findings from
other studies, offer support for our approach that the effectiveness of display usage is
moderated by the type of product under promotion. Using observational data we find that the
impulsive power and therewith promotional efficiency depends on the type of underlying
product specific buying behavior. As our findings show, displays are more effective in
influencing purchase behavior when used with impulsively bought products. The question to
which extend other categories should be considered for display promotion needs careful
evaluation. With product categories bought routinely, other than display-based forms of
promotion seem to be more promising strategies with regard to promotional efficiency.
Introduction
Sales promotions cover a wide spectrum of activities to influence consumers to make a
purchase. Especially monetary promotions like price-offs, rebates or coupons, are heavily
used in this context, and their effects have received considerable attention in research (Darke
2001; Tellis 1998, p. 218). Among non-monetary approaches to influencing purchase
behavior at the POP, displays are frequently used (Rossiter & Percy 1997, p. 391; Tellis 1998,
p. 235; Sullivan & Adcock 2002, p. 148). For instance, Gibson (1992) reports that up to
62 percent of total sales of popular brands are attributable to displays. The impact of displays
on buying behavior has been covered by a number of studies (e. g. Wilkinson, Mason &
Paksoy 1982; Curhan 1974; Chevalier 1975; Narasimhan, Neslin & Sen 1996; Wittink et al.
1988).
All in all, it has been shown that displays can have a positive impact on sales.
Surprisingly, the important issue of display promotion efficiency has not been discussed in
research yet. In consequence, marketers are still lacking empirically founded
recommendations how to influence customers in the most efficient way through display
usage. This neglect of efficiency issues in display research leads to the circumstance that a
number of more differentiated possibilities remain unused. The purchase of a package of
flour, for instance, is processed according to an entirely different logic in the consumer´s
mind than a purchase of a chocolate bar. Consequently, in order to influence the buying
process of flour, one must refer to different means as compared to a promotion for chocolate
bars. Tools which show a convincing influence power when used with flour need not
necessarily have the same power with chocolate bars. Incorporating these basic considerations
when conceptualizing promotions might increase promotional efficiency significantly.
This paper emphasizes the notion that the driving forces for customer behavior at the
POP need a more distinctive consideration when planning and implementing in store
promotions. Basically, two key determinants for the success of consumer persuasion in the
context of retail promotion are explored in the following section: product category and
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presentation format. The study supports the hypotheses that buying behavior and the
presentation format at the POP are the key determinants of the influencing power of a display
promotion. As our findings show, displays are more effective in influencing purchase
behavior when used with impulsively bought products. The question to which extend other
categories should be considered for display promotion needs careful evaluation. With product
categories bought by inertia, other than display-based forms of promotion seem to be more
promising strategies when looking at promotional efficiency.
Category-specific purchase behavior
In the literature, consumer decision making is predominantly categorized according to
the degree of cognitive buyer involvement (Assael 1995, p. 152; Engel & Kollat 1993; Cobb
& Hoyer 1986). Therefore, decisions with a comparatively high degree of cognitive
involvement can be distinguished from forms with comparatively low cognitive involvement
(e. g. Sullivan & Adcock 2002, p. 66; Assael 1995, p. 152). The low-involvement-case can be
further differentiated when additionally considering the amount of emotional buyer
involvement. This results in four basic concepts of consumer decision making.
Extensive decision making takes place when consumers are cognitively as well as
emotionally highly involved. In general, one finds a high need for information, and the
decision making requires a comparatively long period of time (Assael’s 1995). Limited
decision making is characterized by a simplification of the cognitive processes. In the concept
of limited decision making, customers are assumed to be emotionally low involved.
Consumers have some experience in buying the product or brand, but do not show any clear
preference for a certain brand or product. Compared to extensive decision making, the
complexity of the process is reduced: as soon as an alternative satisfies the needs, the
consumer will terminate the decision-making process and will purchase this alternative.
Routine decision making (Habitual buying behavior) is utilized for purchase decisions that
have been solved before. The customer has even less cognitive involvement than in the
limited buying-behavior concept. Emotional involvement is also assumed to be low. Routine
decision making is a widely automatic process without assimilating much of external
information. This strategy can be considered as a result of learning processes from repeated
behavior (Assael 1995, p. 125). Impulse buying behavior can be understood as a decision
making process in which customers are only little cognitively involved but usually show a
high degree of emotional involvement. Impulse purchases are unplanned and without an
evaluation of need. They often occur in situations with strong stimuli like POS displays
(Omar 1999, p. 287; Assael 1995, p. 154;). Impulse buying is often referred to be the
prototype of unplanned buying behavior. However, different forms of impulse decision
making can be differentiated (Stern 1962). Pure impulse buying is characterized as a
spontaneous and emotional act which breaks the normal buying pattern. Reminder impulse
buying means that, when confronted with the offer, the customer recognizes a need which he
has not been aware of. Suggestion impulse buying behavior occurs with shoppers visualizing a
need for a product when seeing it for the first time. Planned impulse buying refers to the
consumers´ intention of going to a specific store because of a sale but with no plan to buy
particular products.
In reality, these four types of decision making will not be found in their pure form. On
the contrary, many combinations and overlaps are likely, and other dimensions, according to
which behavior can be organized, may be important.
Although decision making can vary significantly according to situation and person,
research shows that most purchases are based on cognitively limited processes (Assael 1995,
p. 147; Kassarjian & Kassarjian 1979). The majority of purchases in supermarkets does not
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greatly involve customers. This especially is true for frequently purchased goods of daily use.
Neither do consumers extensively gather information for those products, nor are they
involved in complex information processing. Instead, they strive for a fast termination of the
buying process. This is why routine and impulse buying are of particular importance for the
retail environment. This is supported by empirical findings on the extent of planned purchases
in different product categories (e. g. POPAI 1999; POPAI 1987; Bellenger, Robertson &
Hirschman 1978). Studies show that only approximately 20 percent of purchases at the POP
are planned purchases. Examples for products that are bought without prior planning include:
ready-made meals, sweets, desserts, ice-cream or crisps. Routine buying, however, is
prevalent with branded products goods of daily use that are frequently purchased. These are
categories like washing powder, coffee, tooth-paste which are all regularly bought, following
certain patterns.
Presentation format
In general, original shelf presentation (shelving) of a product can be distinguished
from additional presentations which are mainly realized through the application of displays.
Displays might be seen as in-store arrangements that give greater visibility to the brand
through additional presentation to the customer (Tellis 1998, p. 235). Although the
employment of displays is a major point for retailers and is discussed in many textbooks on
retail marketing and management (e. g. Sullivan & Adcock 2002; Cox & Brittain 2000; Omar
1999; Ghosh 1994), surprisingly little insight into the effects on the customer has been gained
by research up to now. Rather, research has heavily focused on short-term sales increases
finding significant boosts in sales due to sales promotion activities (e. g. Woodside & Waddle
1975; A.C. Nielsen 1983; Curhan 1974; Chevalier 1975; Gagnon & Osterhaus 1985).
The primary purpose of displays is to achieve additional contact with the customer
(Sullivan & Adcock 2002, p. 146; Tellis 1998, p. 235). This is meant to provoke a buying
impulse in the consumer (Omar 1999, p. 287). In other words, displays aim at influencing
customers impulse buying. As a consequence their effect should be maximal when using
impulsively bought product categories and the effect should be minimal under conditions
where routine buying occurs.
Several studies have already been able to illustrate the dependence of display
effectiveness in relation to the product category used (e. g. Blattberg & Wisniewski 1987;
Chevalier 1975; Wilkinson, Mason & Paksoy 1982; Bolton 1989). However, it needs
mentioning that most of them are based on scanner data only which do not offer any insight
into the original impulse effect exerted by display usage. In order to overcome this
shortcomings we decided to integrate observational methods into our research project.
Figure 1: The Conceptual Framework
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Product Category /
Buying Behavior
Impulse Power
of Display
Display
Effectiveness
Presentation Format
To sum up, certain product categories tend to imply a certain buying behavior.
Therefore, if buying behavior is meant to be influenced efficiently, the use of well-adjusted
methods which are tailored to the category and to the consumer´s decision seem to be a
fundamental necessity. This means that the efficiency of promotional influence strategies will
be strongly moderated by the product category: In cases where impulse buying occurs,
displays might exert maximal power whereas with routinely purchased products shelf-related
activities might be most efficient. Hence, both buying behavior and the presentation format at
the POP are supposed to be determinants of the influencing power of a display promotion.
This has direct effects on promotional efficiency (figure 1).
Exploratory Analysis
In order to examine our conceptualization a study was conducted. Consumers´ buying
behavior was explored using a 2 (buying behavior type = product category: coffee vs. sweets)
x 2 (presentation format: shelf vs. display) factorial design. The data was collected in a
supermarket.
Two data sets were used. The first set was meant to explore behavior at the POP in
general and therefore was based on observational research only. Behavior was recorded
systematically in a system of categories such as their way of approaching the stimuli, the way
they establish eye contact with the stimuli, the duration of standing next to the stimuli,
grabbing and touching of products, number of items bought and post-purchase behavior. The
data was gathered from customers who approached the relevant test stimuli in the
supermarket within one hour and looked at the stimuli at least once. This resulted in a sample
of 87 customers.
For the second set of data observational and interview data of test product buyers were
used. A total of 60 buyers (= 15 per experimental condition) was analyzed. Subjects in this
sample were first observed with regard to their interaction with the stimuli. Observational
categories were similar to the ones used for the first data set. Finally, if the customer decided
to buy one of the products under examination and put it into the trolley, the person was
interviewed. This interview covered aspects like the point of time when the buying decision
was made, reasons for buying the product, general planning behavior for brands and products,
regularity and frequency of purchases, usage of shopping lists and socio-demographics.
RESULTS
The results provide support for our approach to category specific and presentation
specific buying behavior. The main findings were the following.
Approaching behavior: Sweets in the display were more often approached within one
hour (35 times) than coffee in the display (16 times). Regarding the shelf presentation the
relation was the other way round (10 times sweets vs. 26 times coffee within one hour). The
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speed when approaching coffee in the display presentation was higher than the speed when
approaching coffee in the shelf presentation. This relationship was the other way round for
sweets. Accordingly, display usage had more positive effects on buyers of the impulsively
bought product category than on buyers of the routinely bought product category.
Figure 2: Study Results
SweetsCoffeeSweetsCoffeeNumber of Approaches35161026Share of Purchases fromCategory61,0%12,5%39,0
Purchases: 87.5 percent of the total amount of coffee purchases resulted from the shelf
presentation. Sweets were only purchased in 39.0 percent of the shelf presentation cases. Vice
versa, the share of purchases observed from the display were higher for sweets (61.0 percent)
than for coffee (12.5 percent). Accordingly, impulsively bought products were more often
purchased from the display than routinely bought products.
Grabbing of products: Purchases from the display were more often made without any
hesitation. With regard to coffee, 45.0 percent of customers who showed some hesitation
before choosing the brand, were observed in the display condition. For sweets, this share was
only 33.0 percent. Accordingly, display usage fostered impulsive buying behavior. This was
more effective with the impulsively bought product category.
Planning of purchases: Considering the extent of planning the purchase, for buyers of
coffee no differences between the shelf presentation and the display presentation condition
could be traced. However, for buyers of sweets a difference was found. 60.0 percent of buyers
in the shelf condition had decided to buy the product before entering the supermarket. In the
display condition the share was only 33.0 percent. All in all, the ratio of unplanned to
planned purchases was higher for sweets than for coffee. Accordingly, only with regard to
impulsively bought products unplanned buying was effected by display usage.
Implications
With more than 80 percent of supermarket shoppers making their final purchasing
decision in the store (POPAI 1999; POPAI, 1987), POP activities play an important role in
influencing buying behavior at the POP. Especially displays are used to influence customer
behavior in this situation towards an increase of sales (e. g. Loudon & Della Bitta 1993, p
550). However, to achieve maximum effect on customer behavior, it is necessary to
understand how display promotions work. Insight into which variables affect the effectiveness
can be gained from a customer-based conceptualization of display promotions. Taking that
perspective, we have proposed that the customer´s decision-making process, and display
design can be considered to be crucial factors for the manipulation power of displays.
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The results of a supermarket study support our hypothesis that display promotions are
only efficient if they are used with impulsively bought products. Based on observational
methods we show that consumer behavior differs significantly between different product
categories. This affects effectiveness and efficiency of promotional means. Our research
shows that displays do not always have an impact on consumer behavior. This seems to be of
major importance in order to design more efficient activities. Although of exploratory nature,
our study provides the first empirical support not based on sales data but on observational
methods and therefore offers insight into the impulsive side of POP-behavior. With regard to
the very complex measurement of unplanned purchases, improvements might be achieved by
additionally measuring psychological activation potential caused by display promotion.
Employment of electrodermal registration (Groeppel-Klein & Baun, 2001) would be a
promising starting point. Nevertheless, the findings have several implications for researcher
as well as for managers. Looking at marketing research, a product-specific approach is
necessary when further researching promotional aspects. A differentiated evaluation of the
influencing power of a promotional activity is the key factor for a better efficiency of display
usage. Therefore, promotional conceptions should incorporate customer-related perspectives,
too.
In terms of promotion management it is essential that promotions need to be tailored to
the specific decision making processes. Otherwise promotion efficiency will suffer. As our
findings show, displays are more effective in influencing purchase behavior when used with
impulsively bought products. The question to which extend other categories should be
considered for display promotion needs careful evaluation. With product categories bought by
inertia, other than display-based forms of promotion seem to be more promising strategies
when looking at promotional efficiency.
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1843
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