Retailing
MKTG 3346
Consumer Shopping
Overview
Professor Edward Fox
Cox School of Business/SMU
Factors Driving Consumer Shopping
Behavior
 Needs
 Social group
 Family size
 Occupation
 Price Sensitivity
 Disposable income
 Opportunity cost of time
 Location and Retail Density
Shopping Behavior Depends on the
Product
 High-Involvement, Detailed Process
 Buying a Durable – Car, Computer, Home
 High Risk, Uncertainty
High involvement,
High price,
High risk,
Infrequent
 Moderate Problem Solving
 Some Prior Buying Experience
 Relatively Infrequent Purchase
 May Be Impulse Purchase
 Habitual Decision Making
 Frequent Shopping
 Store, Brand Loyalty Drives Purchase
Low involvement,
Low price,
Low risk,
High frequency
Shopping Behavior Examples
APPAREL
 Moderate Price
 High involvement for some; low for others
 Shopping Product
 Consumers likely to shop around
 Evaluate both quality and price
 Image?
 Experience Good – Touch it; try it on
 Less likely to buy online or by catalog
 Interaction with salesperson may affect
 Browsers or goal (i.e., purchase) oriented shoppers?
 Mall locations facilitate browsing and search
Shopping Behavior Examples
MOVIE
 Low Price
 Low involvement?
 Experience good
 Prerelease advertising
 Quality assessment
 Actors
 Reviews
 Location
 Multiplexes
 Many screens
 Different start times
Are movies cross-shopped with other forms of
entertainment?
Shopping Behavior Examples
INSURANCE
 High Price
 High involvement?
 Unsought Product
 Consumers may avoid the subject
 Don’t want to think about it, so don’t give it much attention
 Credence Product
 Inertia
 Hard to get customers to switch
 Primary interaction with provider may be billing
 Triggered by events (bad stuff happened)
 Regret
Shopping Behavior Depends on Retail
Format
Outlet
% Shopping
Number of
Weekly
Weekly Trips
Spending
Supermarkets
100
2.4
$ 72.82
General merchandise
discount stores
68
1.3
32.53
Fast-food restaurants
65
1.9
16.32
Drug stores
39
1.2
18.70
Convenience stores
37
2.4
19.72
Wholesale clubs
27
1.7
75.12
Specialty food stores
9
1.0
23.70
Source: “Consumers Are Skeptical Again,” “63rd Annual Report of the Grocery Industry,” Progressive Grocer, April 1996, p.42.
Consumer Shopping Process
How Retailers Affect Need Recognition
STIMULATING TRAFFIC AND SALES
 Out-of-Store
 Advertising
 Direct mail
 In-Store
 Visual merchandising
Signage
Displays
 Suggestions by sales associates
In-store merchandising and selling can generate
unplanned, or impulse, purchases
Adapted from Levy and Weitz
Factors Affecting Information Search
 Customer Characteristics
 Experience with the product/category
 Perceived risk
 Time pressure
 Product Characteristics
 Complexity
 Cost
 Risk
 Category Characteristics
 Number of alternatives
 Meaningful differences between products
Adapted from Levy and Weitz
How Retailers Reduce Information Search
KEEPING CUSTOMERS IN THE STORE
 Product
 Extensive merchandise assortment
 Ease in locating alternatives (cross merchandising)
 Useful information from sales associates
 Price
 Everyday low pricing; price matching
 Loyalty incentives; volume discounts; card programs
Adapted from Levy and Weitz
Evaluating Retailers
Source: Levy and Weitz
Evaluating a Product for Purchase
Information used in buying a men’s suit
Source: Levy and Weitz
Between Purchase Intent and the Purchase
Purchase Intention
Desire to buy the most preferred brand/product
In-store
Merchandising
Social
Factors
Product Choice
Choice of the store/brand/product
Intention to buy does not always result in purchase
Buyer’s Decision Process
POST-PURCHASE BEHAVIOR
Consumer’s Expectations of Value
Perceived Value
Satisfied
Customer!
Dissatisfied
Customer!
Retailers must deliver on the promise of value,
or lose repeat business – customer loyalty!
Adapted from Prentice Hall
Example of Marketing to Customer
Segments