Impulse Buying

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Impulse Buying

Submitted To:Sir. Anis Hassaan Zuberi

Instructor: Consumer Behavior

Submitted by:Qurat-ul-ain Riaz (06-146)

Sidra Tanveer (06-228)

Mehreen Raza (06-419)

Najma Javed (06-013)

Submitted on:

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April 29th, 2008

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Table of Contents

Contents Page

Introduction ……………………………………………………………4

Literature review …………………………………………………………5

Management problem …………………………………………………….8

Hypotheses ………………………………………………………………..9

Research design …………………………………………………………...10

Sampling plan ……………………………………………………………..11

Limitations ………………………………………………………………12

Results …………………………………………………………………….13

Conclusion & Recommendations………………………………………………..17

Questionnaire ……………………………………………………………...18

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Introduction

Pakistan is a growing economy with a real GDP growth rate of 5%. The real private consumption

expenditure has grown at an average rate of 7.4 percent per annum during the last four years

resulting in the emergence of a strong middle class with growing purchasing power. This has

resulted in people vying for a more comfortable and urbanized lifestyle. The mushroom growth of

coffee houses, eateries, supermarkets, etc., is a proof of that.

In the past three decades, much research has been conducted internationally to define to understand

the psychological, economic and retail implications of such a trend. One area of interest has been

“impulse buying”. Impulse buying occurs when a consumer experiences a sudden, often powerful

and persistent urge to buy something immediately. The impulse to buy is hedonically complex and

may stimulate emotional conflict. Also, impulse buying is prone to occur with diminished regard

for its consequences.Marketers and retailers tend to exploit these impulses which are tied to the

basic need for instant gratification.

Recently several supermarkets have been established in the urban cities of Pakistan. The most

prominent ones in Karachi are Imitiaz, Agha’s, EBCO, Naheed, Shaz & DMart.

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Literature Review

Pakistan: The Research Context

According to the Economic Survey (2006-07), the real GDP growth rate of Pakistan has been 7%

per annum in the last 5 years and the per capita income has grown by 11% to $ 925. The real

private consumption expenditure has grown at an average rate of 7.4 percent per annum during the

last four years resulting in the emergence of a strong middle class with growing purchasing power

and with increase in the working population and simultaneous decrease in the share of dependent

population has declined, the disposable incomes and current consumption has increased. This

increase in consumer spending has led to more shopping and consequently has justified a research

into the incidence and nature of impulse purchases. Also, with changing demographic trends,

gender roles in purchase behavior have changed considerably in urban Pakistan with women being

more active in shopping now.

Most of the researches on impulse buying behavior have been conducted in the Western society

which is considerably more advanced than Pakistan. The objective of this research is to explore the

incidence of and difference of impulse buying behavior at Naheed Super Store, with respect to

factors such as product category, grocery bill and number of products bought, and the shopper’s

gender.

Conceptual Framework

Cobb and Hoyer and Kollat and Willet have defined impulse buying simply as unplanned

purchasing. Rook (1987) gave a narrow and more specific meaning to impulse buying, which

included behavioral elements. The definition of impulse is as follows

“Impulse buying occurs when a consumer experiences a sudden, often powerful and

persistent urge to buy something immediately. The impulse to buy is hedonically complex

and may stimulate emotional conflict. Also, impulse buying is prone to occur with

diminished regard for its consequences.”

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The understanding of impulse purchasing was greatly improved through Stern's identification of

four distinct classifications of impulse purchasing: planned, pure, reminder and suggestion impulse

purchasing. The four categories are as follows:

(1) Pure impulse buying is a novelty or escape purchasing which breaks a normal buying pattern;

(2) Reminder impulse buying occurs when a shopper sees an item and remembers that the stock at

home is exhausted or low or recalls an advertisement or other information about the item and a

previous decision to buy;

(3) Suggestion impulse buying occurs when a shopper sees a product for the first time and

visualizes a need for it, even though he has no previous knowledge of it; and

(4) Planned impulse buying occurs when a shopper enters the store with some specific purchases in

mind, but with the expectation and intention to make purchases that depend on price specials,

coupon offers, and the like.

Conceptual Definition

Impulse buying is defined as a buying action undertaken without the problem having been

previously recognized or a buying intention formed prior to entering the store

Operational Definition

Based on the literature review we plan to follow the following definition for the purpose of our

research.

Shoppers are asked upon exiting the store what items they purchased. For each item, they are then

asked some variant of the question when they decided to buy; before or after entering the store. The

items purchased whose decisions were made after entering the store are impulse purchases

(Bellenger, Robertson, and Hirschman).

Factors Affecting Impulse Buying Behavior

Many researches have been carried out to study the nature of impulse buying and various factors

that affect it. Impulse buying is influenced by a variety of economic, situational, personality, time,

location and even cultural factors. Researches have also been conducted to understand the

underlying motivational factors behind impulse buying. Similarly researches have been conducted

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to study factors that moderate impulse buying behavior. Consumers engage in impulse buying to

satisfy hedonic desires for fun, novelty and variety; also impulsiveness is correlated with

consumer’s desires to fulfill self esteem and self actualization needs

Gender Differences in Impulse buying

Several previous researches on impulse buying have paid some attention to the role gender plays in

determining this behavior. These researches show that men’s and women’s shopping behavior

differs on many levels.

Kollat and Willet (1967) found that women tend to engage in more impulse buying as compared to

men. It is also argued that women because of their propensity to shop more in general, make more

impulsive purchases.

Transaction Size affecting Impulse Buying

Kollat and Willet (1967) used two measures of transaction size: number of different products

purchased and the grocery bill. They found out that the increase in size of the grocery bill and

number of purchases made resulted in an increase in unplanned impulse purchases. Therefore, we

offer the following proposition.

Shopping List and Impulse buying

Studies conducted by Kollat and Willet (1967) indicated that one of the factors that affects impulse

buying is the presence of a shopping list. This however only holds true if the transaction size is

greater than 15. When more than 15 or 20 products are purchased, shoppers having a list make a

smaller percentage of unplanned purchases. However, when less than 15 or 20 products are bought,

the shopping list does not affect the percentage of unplanned purchases. In order to study the effects

on the presence of a shopping list on impulse purchase behavhior, we present the following

proposition.

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Management Problem translated into Research Objectives

Research Problem

Research Questions

Research Objectives

To study the incidence of impulse purchase decisions with respect to five factors.

What is the incidence of impulse purchase in Naheed Super Store?

How does incidence impulse buying vary due to the presence of a shopping list?

Does increase in the size of grocery bill increase the incidence of impulse purchase decisions?

Does impulse buying increase as the number of products purchase increase?

Is the incidence of impulse buying higher among males than females?

To study the incidence of impulse buying in supermarkets of Karachi.

To study whether purchase intentions are influenced by factors such as the gender of the shopper, presence of a shopping list, the number of products purchased and the size of the grocery bill.

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Hypothesis

Based on our discussion & literature review, we arrived at the following hypotheses which we

would be testing.

Hypothesis 1: There is at most 20% incidence of impulse buying in Naheed Super Store.

Hypothesis 2: There is association between gender and impulse buying behavior.

Hypothesis 3: Rate of Impulse buying increases with the size of the bill.

Hypothesis 4: Rate of Impulse buying increases with the number of different products bought.

Hypothesis 5: There is association between presence of shopping list & impulse buying behavior.

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Research Design

Type of research

The research was of exploratory nature and involved conducting interviews of shopper leaving

supermarkets to crystallize and better understand the problem at hand and a few factors that affect

it.

Data Collection Method

Secondary Data

Articles on impulse buying were studied.

Primary Data

We collected information from the subjects by means of a survey. Furthermore the major technique

that we used to approach our subjects was the intercept technique i.e. approaching them without

prior notification or appointment. Personal intercept interviews were used to collect information in

a face to face situation. The survey was conducted at Naheed Super Store.

Measurement Technique

A questionnaire was designed by the researchers to be administered during the personal interview.

Care was taken to avoid loaded, double barreled, biased questions.

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Sampling Plan

Population Definition

Men and women of age 18 and above who have shopped at Naheed Super Store in April, during

day time.

Sampling Frame

Naheed was selected to conduct the research.

Sampling Unit

One shopping party.

Sampling Method

Non-probability convenience sampling - any shopping party leaving the Super store after making

some purchases.

Sample Size

Total sampling size of 80.

Sampling Plan

The four researchers were spilt into two interviewing teams. One of the two interviewers was

stationed at the super market exit to select a shopping party leaving the super market after making

some purchases. The respondent was qualified by determining whether they were carrying any

shopping packages and their willingness to participate in the research. After introduction the second

researcher administered the questionnaire through a personal interview. The questionnaire was

completed and filled by the researcher herself. The interview was terminated by thanking the

respondents for their participation.

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Limitations

1. People in our country are not very used to research hence they were not very receptive or

did not know how to respond to certain questions.

2. As students, the researchers had limited amount of resources (time, money, etc) to spend on

this research.

3. This research has been conducted only in one supermarket (Naheed) the findings cannot be

extended to all the supermarkets in Karachi. Hence the findings are only applicable to

Naheed.

4. This research focuses on the incidence of impulse buying and a few factors affecting it such

as gender of the shopper, size of the shopping bill, presence of a shopping list and the

number of items purchased. This does not suggest that these are the only factors that

influence impulse buying decisions.

5. Some other influencing factors such as in-store stimuli (communication mix, shelf

placement), consumer traits other than gender, situational factors (mood, time, money) and

normative traits of decision making have not been studied. Hence, the findings of this study

cannot be extended to those areas.

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Results

Hypothesis 1: Incidence of Impulse buying

Our results showed that the incidence of impulse buying is significantly greater than 20%.

Hypothesis 2: Association of Unplanned Purchases with Gender

  Male FemaleColumn Total 

Impulse 13 36 49

Planned 21 10 31 Row Total 34 46 80

Table 1

This table indicates that men plan well ahead before entering shopping markets than females. They

economize on their time and efforts and stick to their needs and decisions. Females do not plan

extensively before entering and are more inclined to be attracted to in-store stimuli.

M / Im16%

F / Im45%

M / Pl26%

F / Pl13%

Figure 1

Kollat and Willet, women purchase a higher percentage of products on an unplanned basis because

they make more purchases. When the number of purchases is held constant, men and women have

the same degree of susceptibility to unplanned purchasing. However, our analysis indicates that in

Naheed Super Store, the number of products purchased by respondents has no affect on impulse

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buying tendency. Thus, the impulsive behavior in our research can be attributed to solely to gender.

Women are more susceptible to engage in impulsive behavior in supermarkets.

Hypothesis 3: Shopping bill and impulse buying behavior

Shopping bill is also a measure of transaction size. The Figure 2 depicts that there is no relationship

between unplanned purchasing and shopping bill.

Relationship between Shopping Bill & Percentage of Unplanned Purchases

0%

10%

20%

30%

40%

0-500 501-1000 1001-1500

1501-2000

2001-2500

2501-3000

3001-3500

Over3501

Shopping Bill (Rs)

Perc

en

tag

e o

f U

np

lan

ned

Pu

rch

ases

Figure 2

This is line with our findings relating to the number of products purchased in which we found no

correlation between the number of products and the impulse buying behavior. Generally we can

conclude that people who buy more will have more shopping bill and will be engaging in less

impulse buying.

Hypothesis 4: Number of Products bought and Impulse buying

The percentage of unplanned purchases has no significant correlation with the number of different

products bought by shoppers in Naheed Super Store.

Our findings show that as the number of different products a customer intends to purchase

increases, the difference between actual and intended purchase decisions do not vary. Even though

the greater the number of products purchased, the greater the exposure to in-store stimuli but the

number of products bought on impulse do not increase. Hence, we conclude, that in instances

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where customers shop for a larger number of items they plan well ahead and there are little chances

of impulse buying. This can be because as customers plan for larger items they try to economize on

their time and effort – hence little or no impulse purchases. However, when customers shop for a

few needed items or engage in random shopping, they are more inclined to engage in impulse

buying.

Hypothesis 5: Shopping list and Impulse buying Behavior

We found no significant association between the two variables. We interpret that the shopping list

contains only basic items and when people enter the super market they engage in impulse buying.

Hence we conclude that the tendency of a consumer to engage in impulse buying has no association

with the shopping list.

Also from the Table 2 we can conclude that majority of the people do not carry shopping list with

them (44%) or carry it only sometimes (35%). This shows there is natural tendency amongst

shoppers not to carry shopping lists with them.

  Shopping listNo Shopping List  

Planned 12 20 32

Unplanned 11 37 48

  23 57 80

Table 2

List / Im14%

No List / Im 46%

List / Pl15%

No List / Pl25%

Figure 4

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Kollat and Willet (1967) found that a shopping list influence purchases when more than 15 products

are purchased. In our study, amongst those respondents who did buy more than 15 products only

44% could be categorized as impulse buyers and 42 % of these were carrying a shopping list. From

this we can conclude no effect as such of shopping list on the rate of impulse buying even when

large number of different products is bought.

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Conclusion and Recommendations

Our research shows that impulse buying is a phenomenon common amongst the female shoppers in

Karachi. This can be because usually women buy for the whole family, not only for themselves. So

as they shop they are reminded of the items needed by others as they come across the products in

store and thus buy them. Also women generally have greater time on hand to do shopping as

compared to men; hence increasing their tendency to engage in impulse buying. This has important

implications for the in-store placement of products. Products with which women can be attracted to

buy on impulse, such as frozen food, spices and other household & food items, should be

prominently displayed in-store so as to generate impulse purchases.

The impact of presence of shopping list, size of the shopping bill and number of products purchased

was found to be insignificant. Even the people carrying a shopping list engaged in impulse

purchases. This can be because most of the items on the shopping list were collective use items or

those needed by other people whereas personal use items were bought on impulse. Some of the

people were carrying shopping lists made by someone else (who was not in the shopping party)

such as the chef, mother-in-laws and spouses.

The bill size and the number of items purchased are two measures to define the transaction size.

Overall, both of them turned out to have no significant correlation with impulse buying. This shows

that people who come to make large number of purchases plan their shopping beforehand and hence

engage in less impulse buying. This maybe because they have already spent so much time spending

what they had planned to buy, that there is little time left to make other unplanned purchases.

We found high incidence of impulse buying in snacks and confectionaries. This maybe because

they are placed near the counter or at visible places in the Supermarket so as to attract people to buy

them. We also found frozen food to be one of the recurring items on the list of unplanned products

by the respondents. These incidences of impulse buying maybe because the deep freezers with

transparent doors carrying the frozen food items are placed right at the entrance of most of the

superstores, hence catching people’s attention as they enter or about to leave the store. Thus the

importance of in-store stimuli can be inferred from our study as we did not specifically test for their

significance. This can be the topic of future researches.

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Questionnaire

This questionnaire is for an academic research paper designed to assess consumer buying behavior at superstores. Your information will be kept confidential and the responses will be aggregated for analysis. We appreciate your participation.  

 Name: _________________________________________________________________

Age: 21-29 30-39 40-49 50-65

Gender: Male Female

Area of residence: _______________________________________________________

Household Income: ______________________________________________________

1. How often do you go shopping? Twice a week Weekly Twice a month Monthly

2. What did you come to buy today? (Please tick one)

Monthly ration Weekly grocery A few needed items Random shopping

3. Do you usually carry a shopping list?

Never Sometimes Always

4. Are you carrying a shopping list today?

Yes No

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5. Did you stick to your shopping list?

Strongly agree Agree Disagree Strongly disagree

6. How many items did you buy today?

 

7. How many of these items had you planned to buy before entering the store?

1-5 6-10 11-15 16-20 21-25 26-30 31-35 36-40 41+

8. Did you buy something that you had not planned on buying?

Yes (if yes answer the next question) No

9. If yes, please give the name of the products?

10. Among the 3 product categories, did you buy something that you had not planned on buying?

 

  Product name Quantity Price

Confectionary      

Snack food      

Deodorant      

Other      

  

11. What is the approximate size of your bill?

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