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Research about unplanned purchases of shoppers, the impact of product packaging on unplanned buying and shelf positioning of the product in Retail markets, shopping centers.
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BUSINESS RESEARCH METHODS
Is Impulse buying significant? Impact of Packaging and Shelf
positioning in impulse buying of FMCGs
GROUP MEMBERSAhmed NasirBilal Ahmed
Mahmudul Hasan NuriNabeel Opel
Tahir Ali
ABSTRACT
Consumers’ psyche of buying behavior is considered a black box; the factors that impact buying behavior are numerous. FMCGs revenue stream comes from planned and unplanned buying behavior of consumers. Unplanned buying which is also known as impulse buying, is impacted by several factors. There are two independent variables which are considered shelf positioning and packaging which can lead to consumer impulse buying behavior. A sample size of 300 consumers and 8 supermarkets in the premises of Rawalpindi and Islamabad, relating to the factors mentioned earlier along with a few others such as wor of mouth and price in the process of studying the effect of the two dimensions data was obtained through survey forms. This data was then analyzed and a clear relationship was developed between each of the factors namely, packaging and shelf-positioning with Impulse buying. The research concluded that the explanation of impulse buying can be from difference in packaging and visibility in terms of shelf-positioning. The research can also help brand makers and marketers to effectively market products to increase sales by making the products physically attractive and visible.
OBJECTIVES OF RESEARCH
Impulse buying does vary among similar FMCGs when there is difference in packaging, shelf positioning or not.
Was impulse buying more significant if the product itself had better packaging and better visibility in terms of shelf positioning.
Can high visibility of the product itself in terms of shelf positioning compensate for poor packaging
And if there is lower visibility in terms of shelf positioning can it be compensated by better, attractive packaging
The last and the most critical objective of this research was to identify which set of factors, such as better packaging and visible shelf-positioning, result in higher Impulse buying.
LITERATURE REVIEW•(Stephen, 1990) concludes that approximately 65% of all supermarket purchase decisions were made in-store with over 50% of these being unplanned decisions vary across product categories.
•Average customer purchase 50.5% of the products on an unplanned basis (Kollat & Willett, 1984).
•Differences in packaging excellence are directly translated into corresponding differences in sales appeal (Twedt, 1983).
•Displays can increase the unplanned purchase in Retail stores (Peak, 1977 & Quelch, 1983).
IVs, DVs AND THEIR DATA TYPES
Impulse Buying (DV)
Shelf Positioning
(IV)
Word of Mouth (IV)
Price (IV)
Packaging (IV)
SCOPE AND LIMITATIONS We have chosen Fast moving consumer goods or FMCGs like tooth pastes,
shampoos and other food items for the purpose of our research to study impact of shelf positioning and packaging on impulse buying because these are generally place on shelves.
These products are generally in use by majority of the consumers so it would give us data which will give a fair picture of the phenomenon.
We will assume to take our DVs Packaging, shelf positioning, word of mouth of the product and price for analysis, data collection. Other factors may also have an impact but in order to study the DVs it is important make other factors constant.
Another assumption is that we will take those consumers who would come for planned monthly grocery shopping at super markets who buy these at the beginning of the month when they receive their respective salaries and ignoring those who come to make purchases other than the monthly shopping.
A limitation of the research is that we will consider only 8 supermarkets which are representative of the consumer populace of Rawalpindi and Islamabad region.
There could be biasness in the views of consumers about preferences in buying behavior like brand consciousness, price etc but we have structured our survey forms in such a way to have unbiased data.
94%
6%
Are you a Regular Shopper of Grocery
Stores?
Yes No
27%
51%
15%
7%
How often do you shop for groceries in a
month?
Once TwiceThrice More than Thrice
18%
80%
2%
What kind of places do you like to go for gro-
cery shopping?
Retail Stores Super Markets Others
6% 15%
40%
32%
7%
How would you categorize yourself, in making purchase
decisions generally?
Very Impulsive Impulsive NeutralThoughtful Very Thoughtful
13%
52%
35%
1%
Do you do prior planning about the things you will buy, before going into the super-
market?
Always Mostly Sometimes Never
100%
Have there been cases when you end up buying things
which were not a part of your plan?
Yes No
15%
85%
Which do you deem as more important out of the following
pair, in triggering the cus-tomers to make impulse pur-
chases?
Word of Mouth Packaging
61%
39%
Which do you deem as more important out of the following
pair, in triggering the cus-tomers to make impulse pur-
chases?
Shelf Positioning Packaging
20%
80%
Which do you deem as more important out of the following
pair, in triggering the cus-tomers to make impulse pur-
chases?
Word of Mouth Shelf positioning
61%
27%
12%
In the absence of attractive packaging which factor will
you rate most important (1) in generating an impulse buy?
Shelf positioning Word of Mouth Price
31%
54%
15%
In the absence of attractive packaging which factor will
you rate important (2) in generating an impulse buy?
Shelf positioning Word of Mouth Price
8%
19%
73%
In the absence of attractive packaging which factor will
you rate least important (3) in generating an impulse buy?
Shelf positioning Word of Mouth Price
62%21%
17%
In the absence of nice shelf positioning which factor will
you rate most important (1) in generating an impulse buy?
Packaging Word of Mouth Price
33%
46%
21%
In the absence of nice shelf positioning which factor will
you rate important (2) in generating an impulse buy?
Packaging Word of Mouth Price
5%
33%
62%
In the absence of nice shelf positioning which factor will
you rate least important (3) in generating an impulse buy?
Packaging Word of Mouth Price
5 out of 5
4 out of 5
3 out of 5
2 out of 5
1 out of 5
0
20
40
60
80
100
120
140
Extremely LowLowNeutralHighExtremely High
What has been the frequency of impulse pruchases?
Rate
packagin
g in o
rder
of
its a
bilit
y t
o a
ffect
impuls
e b
uyin
g?
5 out of 5
4 out of 5
3 out of 5
2 out of 5
1 out of 5
0
20
40
60
80
100
120
Extremely LowLowNeutralHighExtremely HIgh
What has been frequency of Impulse purchase?
Rate
the S
helf
Posit
ionin
g in o
rder
of
its a
bilit
y t
o
aff
ect
impuls
e b
uyin
g?
Highl
y Im
porta
nt
Impo
rtant
Low Im
porta
nce
0
20
40
60
80
100
120
UnimportantNeutralImportantHighly Important
In the absence of attractive packaging, what rank would you give to shelf positioning?
For
pro
ducts
, w
hic
h d
o n
ot
have v
ery
att
racti
ve
packagin
g,
how
im
port
ant
is t
heir
shelf
-posit
ionin
g
in t
riggeri
ng a
n im
puls
e b
uy?
Highl
y Im
porta
nt
Impo
rtant
Low Im
porta
nce
0
20
40
60
80
100
120
140
UnimportantNeutralImportantHighly Important
In the absence of nice shelf positioning, what rank would you give to packaging?
For
pro
ducts
, w
hic
h d
o n
ot
have n
ice s
helf
-posi-
tion,
how
im
port
ant
is t
heir
packagin
g in t
riggeri
ng
an im
puls
e b
uy?
Stro
ngly
Disag
ree
(1)
Disag
ree
(2)
Neutra
l (3)
Agree
(4)
Stro
ngly
Agr
ee (5
)0
20
40
60
80
100
120
140
Strongly DisagreeDisagreeNeutralAgreeStrongly Agree
In your opinion, could an improvement in packaging or shelf-positioning further in-
crease the number of unplanned (impulse) purchase?
Bett
er
packagin
g leads t
o g
reate
r chances o
f Im
puls
e b
uyin
g?
Stro
ngly
Disag
ree
Disag
ree
Neutra
l
Agree
Stro
ngly
Agr
ee0
20
40
60
80
100
120
140
Strongly DisagreeDisagreeNeutralAgreeStrongly Agree
In your opinion, could an improvement in packaging or shelf-positioning further
increase the number of unplanned
Hig
hly
vis
ible
shelf
-posit
ionin
g leads t
o g
reate
r chances o
f Im
puls
e b
uyin
g?
HYPOTHESIS 1: “Impulse buying is greater in the case of better packaging or better
shelf-positioning”
HYPOTHESIS 2: “Unattractive packaging results
in a greater role of shelf-positioning (in terms of higher
visibility) to play in producing an impulse purchase”
HYPOTHESIS 3: “Lower visibility of products in terms of their shelf-positioning, results in a greater role of the
factor packaging to play in Impulse buying”
HYPOTHESIS 4: “Improvement in packaging and visible shelf positioning results in
higher impulse buying”
CONCLUSION
From the above analysis, it may therefore be stated that Packaging and Shelf-positioning do have the ability to impact Impulse Buying. And marketers can gain a lot by keep this factor in mind and making use of both these variables to their own advantage. If marketers seriously take these factors in account, they can draw many conclusions which will ultimately benefit them. Another point of concern here is for the marketers offering a differentiated proposition, Packaging and key positions in the shelves can surely make their products stand out from the other.
BIBLIOGRAPHY Abratt, R. and D.G. Stephen (1990). Unplanned Buying and In-Store Stimuli in
Supermarkets, Managerial and Decision Economics, Vol. 11, No. 2. (May, 1990), pg. 111-121.
Bellenger, N. et al. (1978). Impulse Buying Varies by Product, Journal of Advertising Research 18, December, pg. 15-18.
Bultez, A. and P. Naert, (1988). Shelf Allocation for Retailers’ Profit, Marketing Science, (1988), Vol. 7, No. 3, pg. 211-231.
Cox, K. (1964). The Responsiveness of Food Sales to Shelf Space Changes in Supermarkets, Journal of Marketing Research, Vol. 1, No. 2. (May, 1964), pg. 63-67.
Clover, V.T. (1950). Relative Importance of Impulse-Buying in Retail Stores, Journal of Marketing, Vol. 15, No. 1. (Jul., 1950), pg. 66-70.
Chevalier, M. (1975). Increase in sales due to in-store display, Journal of Marketing Research 12, November, pg. 426-31.
Engel, J.F. et al. (1978). Consumer Behavior, New York: Holt, Rinehart and Winston. John, W.C. (1951). Results of Two Years of Study into Impulse Buying, Journal of
Marketing, Vol. 15, No. 3. (Jan., 1951), pg. 362-363. Kennedy, J. R. (1970). The Effect of Display Location on the Sales and Pilferage of
Cigarettes, Journal of Marketing Research 7, May, pg. 210-15. Kollat, D.T. (1966). A Decision-Process Approach to Impulse Purchasing, Science,
Technology and Marketing, American Marketing Association, September, pg. 626.
Kollat, D.T. and R. P. Willett (1967). Consumer Impulse Purchasing Behavior, Journal of Marketing Research 4, February, pg. 21-31.
Kollat D.T. and R. P. Willett (1969). Is Impulse Purchasing Really a Useful Concept for Marketing Decisions? Journal of Marketing 33, January, pg. 79-83.
Kotler, P. (1984). Marketing Management: Analysis, Planning and Control, Englewood Cliffs, NJ: Prentice-Hall.
Kollat, D.T. and R.P. Willet (1969). Is Impulse Purchasing Really a Useful Concept for Marketing Decisions? Journal of Marketing, Vol. 33, No. 1. (Jan., 1969), pg. 79-83.
Patterson, L. W. (1963). In-Store Traffic Flow, New York: Point-of-Purchase Advertising, Institute, Institute, Inc., (1963), pg. 2.
Peak, H. S. and E. F. Peak (1997), Supermarket Merchandising and Management, Englehood Cliffs, NJ: Prentice-Hall
Quelch, J. A. (1983). It's Time to Make Trade Promotion More Productive, Harvard Business Review May/June, pg. 130-36.
Sayman, S et al., 2002, Positioning Of Store Brands, Marketing Science, Vol. 21, No. 4, (Autumn 2002)m pg. 378-397.
Sewell B. (1984). Merchandising Seminar, Institute of Marketing Management, London, April.
Stern, H. The Significance of Impulse Buying Today, Journal of Marketing, Vol. 26, No. 2. (Apr., 1962), pg. 59-62.
Twedt, D.W. 1968, How Much Value Can Be Added Through Packaging, Journal of Marketing, Vol. 32, No. 1 (Jan. 1968), pg. 58-61.
Vernon T. Clover, "Relative Importance of Impulse Buying in Retail Stores," Journal of Marketing, 15 (July 1950), pg. 66-70.
Wilkinson J.B. et al. (1982). Assessing the impact of short term supermarket strategy variables, Journal of Marketing Research 19, February, pg. 72-85.
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