The Psychology of Impulse Buying
Understand the customer. Those may be the three most important words for a specialty retailer. Experts say they’re the absolute core of business.
Why do customers do what they do? What are they thinking? What do they want? How much do they want to spend? If only you could open up the mind of a consumer and take a few notes. If only you could jot down what’s going on in there—and then devise a plan to make them obey your every marketing command. Now that would be serious selling.
But you can’t very well pull out a scalpel and have at it, even if you could get the answers that way. What you can do is know more about the psychology of consumers and what leads them to impulse-buy… solid information from some of the best marketing professors and shopping scientists around.
You’ve heard people say they don’t know what they want until they see it. They’re not lying. And as it turns out, specialty retail on carts and kiosks is all about impulse buying. “Two-thirds of the shopping that goes on in malls is impulse buying,” says Paco Underhill, author of the book, Why We Buy: The Science of Shopping. “Actually two-thirds of the entire economy is impulse buying.”
Tim Runner, president of wholesaler ASI (Mission Viejo, CA), agrees. He says most cart products are impulse buys—unplanned purchases. “Very few people leave their home and say they’re going to the mall to find a cart and buy my products,” he says. “They don’t even know what I have, usually, until they’re walking by.” But “unplanned” doesn’t necessarily mean self-indulgent or frivolous; and “instant gratification” is something more than just for kicks.
The purposeful buy
Purposeful shopping, on the other hand, is when consumers realize they need something and they set out to go get it—they have something in mind that they want to buy. “People are often somewhere else other than a store—maybe at home—when they realize they need something,” says Donald R. Lichtenstein, professor of marketing and associate dean at the University of Colorado Leeds School of Business. He says consumers go through what psychologists call “problem recognition” and “actual state of affairs.” A person realizes she just squeezed out the last squirt of toothpaste (so the problem she recognizes and the actual state of affairs are that she’s out of toothpaste). She decides she can’t do without it, so she decides to go to the store and buy more. “Having toothpaste then becomes… the ‘desired state of affairs,'” says Lichtenstein.
For an impulse buy to get started, experts say the first thing that has to happen is the consumer’s exposure to the product. In a retail setting, that’s vital. And then (the retailer hopes), that exposure will trigger problem recognition. That’s precisely why every grocery, mass-market and drugstore check-out has a wall of impulse items. So do the cash wraps of department stores (e.g., boxed chocolates in Jewelry, mini-cookbooks in Kitchenware), bookstores (pens, eyeglasses, mini-lights) and everything in between: all those little POS displays of related quick-grab goodies.
So a shopper in line at the grocery sees a pack of mints, and it reminds him that there were onions on the sandwich he just had (problem recognition). He decides to buy the mints. Why? To create a desired state of affairs: good breath. But exposure to a product can also trigger a memory of when the consumer needed that product in the past, Lichtenstein says. The grocery shopper might be thinking, “I could have used these mints when I sat next to that beautiful woman on the plane last week.” So even if he didn’t think he needed mints right now, he’s likely to buy them “just in case” a similar situation comes up again. So there’s really no deep, dark Freudian thing going on with consumers here: they recognize their problem, whatever it happens to be at the moment; they want it solved; and seeing the product gives them the opportunity to solve it.
Nevertheless, Virgil Klunder, executive director for Comfort Zone (Cape Coral, FL), a health-and-fitness cart retailer, says that for him, the psychology of impulse buys come down to two primal human motivations: avoiding pain or experiencing pleasure. (Starting to sound a little Freudian now, isn’t it. But fear not.) “For every product, I look at the number of steps it takes for consumers to understand how that product will help them either avoid pain or gain pleasure. The fewer [the] steps, the better that product will do,” he says. “These big companies go out and spend millions on research, and that’s really what it comes down to—avoiding pain and gaining pleasure.”
Seeing is buying
Underhill, Lichtenstein and other psychologists and marketing experts have great news: impulse buying is all about seeing the product. So specialty retailers, especially those on carts and kiosks, have the upper hand in a retail setting. You’re in the path—indeed, in the face—of consumers. You have huge visibility.
“Cart and kiosk operators have an automatic advantage over typical stores because of their exposure to consumers,” says Lichtenstein. “They’re right out in the open so that everyone walking by can see them—and that’s the first and most important step in impulse buying: seeing the product. Being in their faces and placing the focus clearly on what you’re selling so that they can make a quick selection sums up what a kiosk operator needs to do.”
Lars Perner, a professor at the University of California at Riverside, agrees: The more visible the product, the more likely it is to be bought—provided the consumer knows what the product is or does (one key reason demonstration is so effective). “The best suggestion I can offer cart managers to increase impulse buys is visibility,” says Perner. “Visibility is the most important factor. You see the products as you walk through the mall, and you will see a lot more of the merchandise than what’s in the windows of traditional stores. Those stores have to compete for attention both with the kiosks and the store windows on the other side of the mall. But it’s much more difficult to overlook a kiosk.”
Underhill says cart and kiosk operators can even let the consumer know what they’re selling gradually. “From 50 yards, get their curiosity up; from 25 yards, make them focus on what you’re selling; and from 10 yards, make them want to stop at the kiosk. It comes to down to sight lines and signage.” Signs proclaiming sales or otherwise calling attention to the product may help, too. If the sign signals a good deal, Lichtenstein says you’re likely to get the “deal-prone” consumer to stop. “Some consumers are especially susceptible to signage that shows a good deal; they get satisfaction from getting what they perceive to be good prices on products or services,” he says. “They’ll buy something just for the good feeling they get if they perceive they’re getting a good buy. It’s the satisfaction of the deal.”
A note of warning, though: “Reference pricing [for example, a product that used to be $40 is now $29.99] will often pull the deal-prone consumer in,” he says. But attorneys general in several states are starting to crack down on retailers who use reference pricing solely as a way to make sales (e.g., the full price never was $40). “Retailers need to be careful, and only use reference pricing when they can justify that the higher former price was bona fide,” Lichtenstein says. “If they can’t, [it] may fall into the deceptive-advertising category.”
It’s not just the numbers or words on your sign that can draw customers. Color can draw them in and keep them focused on the product, says Leatrice Eiseman, author of The Pantone Guide to Communicating with Color. And strong contrast, like black and yellow, is key. “Bright yellow has been proven to be the most visible [color],” she says. “When humans see those colors together, they usually have an instinctive reaction,” an ancient collective memory of predatory animals. “Tigers have those colors, and so humans naturally react to them,” she says.
Of course, she’s not advocating that everyone go right out and buy black and yellow signs. But she does advocate high-contrast colors. And she suggests standing several feet away from your cart or kiosk to see how well your signs stand out against everything around them—which is also contrast.
Upping the impulse quotient
So that’s the gist of impulse buying, and you don’t need a graduate course in psychology to make it work for you. Assume consumers realize a problem and are looking for the solution (your product). That can happen either before they go shopping, or not until they see the product that triggers the thought. Make products easy to spot: make them highly visible. And when their problem and your solution intersect, bingo! Impulse buy. A pleasurable experience on both sides of the cash wrap.