Like nearly 60% of my fellow shoppers, I’ve succumbed to the occasional spontaneous purchase.
This temporary lapse in self-control typically occurs in those moments when I’m fidgeting in line, waiting for the next available cashier to ring in my purchase. A tried-and-true marketing tactic, impulse purchasing is a strategy retailers have relied on for decades. Merchants have strategically placed inexpensive goodies around checkout lanes since the 1950s. Truth be told, those well-placed point-of-purchase displays are usually where I’m reminded I need a new pair of socks (thanks, H&M!).
As ecommerce continues to drive consumers online, some brick-and-mortar retailers are concerned that profits from this kind of impulse shopping will fade into oblivion. But statistically speaking, this isn’t the case. A recent CreditCards.com poll shows that five out of six American shoppers admit to making impulse purchases, 79% of which took place in physical storefronts. Stores have a leg up on being able to tightly control the shopping experience, particularly compared to their etailer counterparts.
So, how can retailers ensure shoppers will still make those unplanned purchases? Let’s delve into the psychology of the phenomenon, as well as some concrete tactics to spur consumers to buy on the fly.
The Science Behind Impulse Purchases
Most consumer behavior lives in our unconscious mind. This area of the brain is a vault for automatic skills, information processing, dreams, and intuition.
According to Psychology Today, the spontaneous urge to spend our hard-earned money is ingrained in our DNA.
According to the renowned trade publication, here are some reasons why:
We’ve been conditioned at a young age to derive joy from receiving new things.
Have you been to a child’s birthday party lately? It’s hard to miss the table with the toppling pile of gifts. We are genetically programmed to acquire new things, even if there’s no immediate need for them. Not only that — we actually get a true “high” when we shop, based on a growing body of research. The act of acquiring, or even just trying peering in shop windows on trying on new clothes, can release a flood of dopamine that boosts your mood and gives shoppers a feeling of satisfaction.
FOMO (fear of missing out) is real, except that psychologists call it loss aversion.
It’s that nagging feeling you get when you fear regretting a decision in the future. Especially when those shoes you decided you don’t need are marked down 25%. To avoid that telltale fear of missing out, that manufactured sense of urgency causes us to snatch up discounted goods.
Shopping with conscious intent is a laborious task.
An unintended consequence of technology is our growing need for instant gratification. To extensively research every item we purchase seems unreasonable, and as a result, people naturally gravitate toward perceived value, which merchants can create with bulk promotions, discounts, or complimentary gifts. In the real world, this could take the form of a bulk buy at Costco or a “free” gift with a purchase from the makeup counter at your local department store.
Our drive to save time and money dates back to our primordial friends.
Consider our hunter-gatherer ancestors. Thousands of years ago, survival depended upon hoarding daily essentials. While this threat is not as significant today, that biological drive is still present in our unconscious mind. Marketers often position their products or services as time and money savers to speak to this drive.
We’re hardwired to believe we’re better than average — and we buy accordingly.
We tend to judge ourselves less harshly and often measure ourselves against our peers. It’s true we may have eaten our weight in cheese over the holidays, but buying a gym membership or that pricey exercise equipment conveys our intent to get back in shape (in our minds). We don’t bother to measure this purchase against our past behaviors (i.e. not finding the motivation to work out in previous months), and instead rely on a vision of what the future could be. And this is often mirrored in our buying choices, as we purchase items and services that feed into this idealized future we picture.
How Retailers Can Trigger These Biological Impulses
Both science and statistics tell us that people will divert from their curated shopping list and that they’re more likely to do it in store versus online. It’s just a matter of experimenting with the best stimuli to encourage those spontaneous purchases.
It might be difficult to get time-strapped shoppers to peruse every inch of your store, but there are tactics you can employ to encourage them to make a purchase on the fly to further benefit your bottom line.
Let’s explore a few of these time-tested strategies.
Choose the Right Products
Photo Credit: Editorialite.com
It’s important to be thoughtful about the items you place in front of consumers when you’re trying to trigger unplanned buys. Some products are better suited to elicit an impulse purchase than others. The first step is to understand the needs and wants of your core customer. For example, Sephora caters to their cosmetically inclined shoppers with a maze of perfectly packaged sample-size products leading to checkout.
Keep these tips in mind when choosing the products you want to sell:
- Make it clear. At this point in the journey, your shopper is likely mentally fatigued from navigating the store and making other purchasing decisions. Willpower is like any other muscle. Retailers may be less successful if an item requires further explanation or it can’t easily fit in a shopping basket.
- Keep it cost-effective. You want to aim for a product that’s inexpensive, appeals to the senses and conveys a sense of urgency. Focus on the inventory that’s found in every home and purchased frequently. Start with items under $20 and closely examine how they sell to determine your pricing sweet spot.
- Jog a memory. Don’t underestimate the everyday item. Sometimes it’s not until you see a pack of gum that you remember you need one.
Take it a step further and validate your assumptions by testing different types of products for conversion. See what sells best in your point-of-purchase displays, and check order histories to see if there are any patterns that emerge (does everyone who buys travel-sized toiletries also grab a reusable water bottle at checkout?).
Draw Shoppers’ Attention with Promotions
Photo Credit: H&M
Consumers can’t be enticed by what they can’t see. This speaks to the commonplace tactic of retailers positioning items front and center around checkout counters. Be sure to consider your core audience. For example, try placing a flashy toy at the eye level of the children who’ll ask their parents to buy it for them.
Signage is another trick to draw the eye to a particular product. Put some thought into the message. Are you trying to communicate the benefits of the product, let your customers know of the limited quantity, or the discounted price? Keep in mind that FOMO point we mentioned earlier. Shoppers don’t want to regret leaving a product behind once they exit the store, so choose the most compelling message that plays into the loss aversion mindset.
Bold red signage makes it near impossible to miss a sale at H&M. Telling shoppers the sale is final can trigger the sense of urgency needed to spur an impulse purchase...or several.
Encourage Purchases with Strategic Placement
Beyond placing items at checkout when shoppers are in the mindset to buy, retailers can also place products near best-selling items to attract extra attention. What are the hot spots in your store when it comes to sales and foot traffic? And how can placing your impulse purchase items in these hot zones help increase their visibility?
Surprise and delight your shoppers by being deliberate about where you set up certain key items. You can encourage purchase through association. For example, Walmart strategically places batteries at the end of a toy aisle. Such complementary items can ensure your shoppers get all the products they need when making a purchase, and these small spontaneous purchases can really add up when boosting your bottom line.
Use Technology to Further Engage Customers
One of the concerns around our relationship with technology is that we’re more likely to have our eyes glued to our phone screens than the products in a store aisle. But you can meet a customer’s eye without forcing them to look up from their screens with the help of a little strategic placement in the app store.
A branded app can keep a customer in your store longer, and offers the opportunity to push location-based promotions, thus driving more of those unplanned purchases you’re eager to see. Location-aware beacon technology can deliver real-time discounts to customers’ smartphones as they walk by a particular item in store. This year, Rite Aid rolled out beacon technology in over 4,500 stores, the largest installation in the U.S. retail industry to date. Beyond reaching the customer through retargeting and personalization, the technology will eventually connect the store to the Internet of Things to create an immersive, always-on retail experience.
While building your own app may sound like overkill at first blush, this is a retail strategy that more research is supporting. A report from Ryan Partnership says 21% of shoppers make more unplanned purchases in store once they engaged with the branded app.
Getting it Right
Understanding what lies in the unconscious mind of a shopper and testing a multitude of tactics in store can help you uncover the right mix to trigger an impulse buy and drive sales. Give the aforementioned triggers a try and let us know how they work in the comments below.
About The Author
Jessica Bianchi is the Manager of Online Content at Canada Post. When she isn't helping brands build their online presence, her interests span content creation, user experience, analytics, and all things digital.