This one is from Mental Floss, and there’s nothing really new here, but what caught my eye is the first one about putting cheap items by the entrance to get your brain excited about saving money. This philosophy has been around for years, putting “loss leaders” up front, ideally the customer sees your great deal on Pepsi, Charmin, or 24-pack water and they grab a shopping cart (which they might not have done otherwise) and are thus more likely to spend more. I’d say virtually ever retailer in the world uses some form of this concept.
Where I work, however, they are moving away from this concept and have replaced most of the promotional ends with beauty displays, batteries and gift card racks. One manager told me that the DM specifically told him not to put paper products up front because “we lose money on it.” Might have something to do with why their front store sales were down 0.5% in fourth quarter and 5% for the year…
1. “OPEN THE WALLET” PRICING
You’ve seen this in action: those grocery store endcaps that advertise an amazing deal on gummy bears. Do you need gummy bears? Probably not. It doesn’t matter; low prices get you in the mood to spend.
“[This] is the technique of pricing items really cheap in the front display aisles at retail and grocery stores to get your brain excited about saving a bunch of money,” says Kyle James, a retail expert and founder of RatherBeShopping.com. “It’s psychological warfare and your money is at risk. Namely, spending money on stuff you had no intention of buying but simply can’t pass up as the ‘deal’ is just too good.”
James points out that Target infamously uses this tactic (think of their bargain bins at the front of the store). “Open the wallet” pricing totally explains the Target “we just need one thing” phenomenon.
2. MAZE-LIKE LAYOUTS
Grocery stores don’t design their layouts haphazardly—a whole heap of psychology goes into it. For example, ever feel like you have to walk miles to get to the dairy fridge? That’s because you practically do. National Geographic’s The Plate explains:
Dairy departments are almost invariably located as far from the entrance as possible, ensuring that customers—most of whom will have at least one dairy item on their lists—will have to walk the length of the store, passing a wealth of tempting products, en route to the milk, eggs, cheese, and yogurt.
It’s the same idea as the “Boomerang Effect.” With this strategy, grocers place popular items and brands in the middle of store aisles so that customers have to walk past other, unneeded items to reach them, no matter which direction they’re coming from. In other words, grocery stores make it purposely difficult to simply get in and out with what you need. They do everything they can to lure you with their products.
“If you’re only running in for milk and eggs, don’t grab a cart or basket,” James suggests. “Instead, carry your milk and eggs in your hands. This way you won’t be tempted to throw impulse purchases into your cart. You can’t buy what you can’t carry.”
3. CHARM PRICING
Charm pricing is another notorious grocery store trick, and James explains what happens when we see this in action.
“Whenever you see a product priced at $29.99 or $9.98, the store is attempting to ‘charm’ your brain by marking prices just below a round number,” James says. “Because our brains are trained to read from left to right, the first digit is the one that sticks in our head and the number we use to decide if the ‘price is right.’ This phenomena is known as the ‘left-digit effect‘ and studies have shown that it absolutely works and has a big impact on our buying decisions.”
He offers an easy trick for combating this. Whenever you see a price ending with .99 or .98, round up, then decide if it’s a good deal. “By knowing exactly what these stores are trying to do, you can walk by these ‘trick your brain’ displays and stay focused on the reason you walked in.”
4. PLACING EXPENSIVE ITEMS AT EYE LEVEL
If you’re looking to save money, look down. Many grocery stores place their most expensive items at eye level and place the bargain buys and generic brands on the bottom shelves. This helps guide you toward the pricier items, since they’re literally right in front of your face.
However, walk down the cereal aisle and you’ll probably notice that flashy brands like Cap’n Crunch are placed on lower shelves. In this case, stores are hoping to catch the eyes of younger consumers—namely, your kids. Research from Cornell found a link between eye contact (in this case, between children and spokes-characters) and consumers’ positive feelings toward a product. For example, here’s how consumers responded to a strategically placed box of Trix cereal:
Findings show that brand trust was 16% higher and the feeling of connection to the brand was 28% higher when the rabbit made eye contact. Furthermore, participants indicated liking Trix better, compared to another cereal, when the rabbit made eye contact. This finding shows that cereal box spokes-characters that make eye contact may increase positive feelings towards the product and encourage consumers to buy it.
To combat this trick, look around at all of your product options, top and bottom shelves included. Simply being aware of this strategy will go a long way toward blocking its effectiveness.
5. BACKGROUND MUSIC
Music seems harmless enough, but it’s another highly effective tool for getting customers to spend more. A now-famous 1982 study published by the American Marketing Association [PDF] found that sales increase and people spend more time shopping in stores playing music. The type of music matters, though. The study reported:
The tempo of instrumental background music can significantly influence both the pace of in-store traffic flow and the daily gross sales volume purchased by customers, at least in some situations. In this study the average gross sales increased from $12,112.35 for the fast tempo music to $16,740.23 for the slow tempo music. This is an average increase of $4,627.39 per day, or a 38.2% increase in sales volume.
Of course, those results only apply to that specific study, but the point is: There’s research that shows music can indeed influence shopping behavior. And you can bet grocery stores use this to their advantage.