The timing of the moment when a customer spots a deal has an influence on the likelihood that they will buy the product advertised. This is because our price sensitivity changes while we are wandering up and down the aisles, says Koert van Ittersum, Professor of Marketing and Consumer Well-being at the University of Groningen. ‘Regular supermarket customers are least price sensitive at the beginning and towards the end of their shopping trips, and most price sensitive in the middle. It’s important for customers to be aware of this, because they are most open to more expensive purchases during these moments of low price sensitivity’, says Van Ittersum.
For customers who are restricted by a tight and limited budget, price sensitivity varies in a different way, says Van Ittersum. ‘People with low incomes are actually more price sensitive at the beginning and end of their shopping trips, and the least price sensitive halfway through. This is presumably because halfway through their shopping they still have a large part of their budget to spend, and they feel rather rich at that point in time.’
Van Ittersum conducted his research in close cooperation with Daniel Sheehan of the University of Kentucky. They conducted four lab experiments and a field study in a supermarket. The researchers have published their findings in the Journal of Consumer Research.
The conclusions are not only relevant to consumers, according to Van Ittersum. ‘Manufacturers and retailers can use the results of our research to decide how their products are best arranged and to work out the best timing for their specials. Take for instance healthy products. Consumers often think that healthy products are more expensive. A supermarket with few budget shoppers can increase the sale of healthy products by placing them in the aisles near the store entrance or exit. Supermarkets with relatively budget shoppers, on the contrary, can stimulate the sale of healthy products by placing them in the middle of the store.’
For the effective use of price promotions, the opposite holds. ‘While supermarkets with few budget shoppers can use price promotions more effectively by offering them in the middle of the store, supermarkets popular among budget shoppers can draw attention to special deals more effectively by positioning them near the store entrance or exit.’
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