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Consumer & The Shop Week 6 Consumer Behaviour and Food Marketing Sources East (chapter 9) Marshall (chapter 5) Lam (2001). The Effects of Store Environment on Shopping Behaviors: A Critical Review. Advances in Consumer Research, 28: 190-197

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consumer the shop

Consumer & The Shop

Week 6

Consumer Behaviourand Food Marketing

sources
Sources
  • East (chapter 9)
  • Marshall (chapter 5)
  • Lam (2001). The Effects of Store Environment on Shopping Behaviors: A Critical Review. Advances in Consumer Research, 28: 190-197
  • Taylor and Nelson web site http://www.tnsofres.com/superpanel
consequences of the retailing growth
Consequences of the retailing growth
  • Saturation
  • Price competition
  • Out-of-town versus town centre
  • Supermarket concentration
gravity models for shopper choice
Gravity models for shopper choice
  • Trade is directly proportional to population and inversely related to distance
    • Geographical vs. time distance
    • Geographical vs. economic distance
  • Central place theory (economic distance)
    • Accounting for demographic differences
huff s retail gravitation model
Huff’s Retail Gravitation Model

Attraction of a shopping centre

Selling area

Travel time

Probability of using a shopping centre:

some empirical results with huff s model
Some empirical results with Huff’s model
  • λ  2
  • Adj. R2  0.25
  • Does the consumer consider ALL shopping centres?
  • What are the effects of ignoring all other details on the shopping area?
store preferences
Store preferences
  • Store image: beliefs, attitudes and feelings about a store
    • What attribute does make the shop attractive to consumer?
    • Image is retained for long periods (difficult to change)
main reason for choosing a store in britain 1994
Main reason for choosing a store in Britain (1994)

Source: Adapted from East (1997), original source CRU-Kingston Business School

supermarket vs local shop 1991
Supermarket vs local shop (1991)

Source: East et al. (1991b, 1997)

determinants of choice
Determinants of choice
  • Salient attributes!
  • One/two factors
  • Store location is the most relevant attribute in UK (several studies)
  • In 1994 price was more important than store location in the US.
shopping trips
Shopping trips
  • “Main trip” customers
  • “Secondary quick trips” customers
  • Average consumer:
    • One weekly trip (main)
    • Supplements of secondary trips
types of customers
Types of customers
  • Principal component analysis (1992) on Britain and US supermarket surveys

Heavy buyer: large income and household, aged under 45, prefers large out-of-town stores, shop later in the day and usually on a regular day

Congestion dislikers: dislike shopping, claim to avoid busy times and to be busy themselves (“reluctant shopper”)

Local shoppers: use small local stores, shop frequently, spend little, often old and from small households

compulsive shoppers
Compulsive shoppers
  • Buying something not needed
  • Buying something that will not be used
  • Mood repair out of the process of buying
the in store environment
The in-store environment
  • It is a tool for market differentiation
  • Store layout
  • Atmospherics
  • The store environment affects:
    • Cognition
    • Emotions
    • Behaviours
slide26

Shun Yin Lam (2001), The effects of store environment on shopping

behaviour: a critical review, Advances in Consumer Research, 28: 190-197

environment and actions
Environment and actions
  • Actions occur when the environment presents:
    • Opportunities
    • Stimuli
    • Rewards
  • Example: try to find the exit in IKEA
congruence
Congruence
  • If store environmental elements/factors are congruent with each other, their effects on emotions, cognitions and shopping behaviour will be magnified
  • Match in cultural dimension
store layout
Store layout
  • Optimising spending opportunities
    • Delicatessen at the back
  • Presenting purchase cues
  • Making the store an easy and pleasant place
  • Place products to increase probability to buy
    • End aisle and displays
  • Optimisation of space and location devoted to a “Stock keeping unit”
    • Optimal layout to maximise profits (e.g. move profitable products to the eye-level)
atmospherics
Atmospherics

MusicColourTemperatureLayoutsOdours

ENVIRONMENT

MOODS

Pleasure-displeasureArousal-non-arousal

BEHAVIOURS

Time spentExplorationCommunicationSpending

East (1997)

some examples
Some examples
  • Smell in the Body Shop
  • Handwritten prices in Oddbins
  • Case study (essay by Clara Ikemeh and Ravinun Bovornsantisuth, 2003)
slide32

“The Treat Store” 

Ambient Factors

Mixture of soft/strong lighting tones

Floral Fragrance 

Design Factors

Very Modern

Pictorial Representations

Use of Subtle colours (Green/Silver)

Numerous strategic positioning tills

Extremely wide aisles

Simply and very orderly layout 

Social Factors

Affluent, more upmarket shopper

Specialist shopper (e.g. organic)

Crowd haters

Strong customer service emphasis

Formal staff uniform

slide33

“The Hypermarket” 

Ambient Factors

Use of contemporary music

Bright/intense lighting

Food Aroma

Design factor

Significant use of subtle colours display (Green/Yellow)

Wider aisle

Pictorial representation

Use of stimuli (e.g. sound bites-“cock a doo” in egg section)

Social Factors

Heavy shopper

Younger shopper

Casual staff uniform

High level floating staff

slide34

“The Local Store”

Ambient Factors

Use of Music

Moderate/poor lighting

Design Factor

Old Fashioned/Outdated

Use of Bright Colours (Red & Yellow)

Simple Layout

Social Factor

Older Demographic profile

Cost saving shopper

Low level of staff flow

Limited Range products

direct stimulus response effects some examples
Direct Stimulus-Response effects: some examples
  • Red is more arousing, lead to quick decisions
  • Rhythm of music influences speed of customers through the store
  • Classical music leads to buy more expensive wine
  • Lighting level in a cellar
    • Affects amount of handled wine
    • Does not influence time spent or amount bought
time of store use
Time of store use
  • Food is perishable
  • Different environment at different times
  • Different level of consumption over the year (seasonality)
weekly timing
Weekly timing

East (1997)

day timing
Day timing

East (1997)

segments by time of use
Segments by time of use
  • Full time employed mainly shop on Friday and Saturday and in the evenings (62% after 2pm)
  • Not full-time employed on average shop earlier in the week and in the day (70% before 2pm)

East (1997)

reasons for shopping on different days times
Reasons for shopping on different days / times
  • Days
    • Near weekend (28%)
    • Day not working (16%)
    • Store less busy (13%)
    • Needed specific food (13%)
  • Time of day
    • Fitted in with other shopping (25%)
    • Store less busy (25%)
    • Left work then (13%)
    • Car / lift / help available (13%)
food retailing methods
Food retailing methods
  • Concentration of retailing in western countries
  • Small shop disappearing
  • Economies of scale
    • Labour costs
    • Economies of “scope” for the consumer
  • Price, services and range differentiation/segmentation
  • Specialisation
    • Kwik save
    • Iceland
non price competition
Non-price competition
  • Multi-buy
  • Link-save
  • Shopper loyalty schemes
  • Retail format
    • Differentiation
      • Specialisation
      • Diversification
retail marketing strategies
Retail marketing strategies

High price

Marshall (1995)

Delicatessen Specialist Food

Department store food hall

Convenience store

Conventional Supermarket

Narrow range

Wide and deep range

Warehouse club

Food superstore

“Hard” discount store

Discount superstore

Low price

retail own brands
Retail own brands
  • Expansion of retail own brands (labels, sub-brands)
    • First/second generation RB
      • Substitutes of well-known brands at a discount price
    • Third generation RB
      • Low price, but close to leader quality
    • Fourth generation RB
      • Added value product, differentiation from competitors, not significant price discount, competing with premium brands, customer loyalty
      • Lower advertising costs
      • Quality control – link between product and retailer name
own brands and price perception
Own brands and price perception
  • Consumer search and shopping costs are too high to search for different own brands
  • Consumer usually select a single store / retail brand
  • Price comparison is made on price of main item retail brand
  • Price of main item retail brand becomes the surrogate of the perceived price level of the whole store
use of information
Use of information
  • Scan data: item data at the point of sale
    • Efficient shelf and store layouts
    • Matching of checkout labour to shopper flows
    • Effectiveness in buying by the retailer (cost reduction)
    • Capability to have link-save, consumer loyalty programmes (panel data)
    • Improved stock management