46% unwilling to pay full price.
New research from Commonwealth Bank shows there’s no one-size fits all approach to enticing shoppers via price promotions, and some may even be turned off by discounting, depending on shopping personality.
Most (81%) ‘bargain hunters’ say price is the main influence when purchasing whereas almost all connoisseurs (95%) say quality is more important than price. The majority (84%) of ‘researchers’ plan their purchases around sales. And half of all ‘brand loyalists’, the fourth shopper personality, say brands lose their allure by offering discounts too often.
Commonwealth Bank executive general manager of corporate financial services, Michael Cant said, “For shoppers, the price they pay for an item often reinforces their perception of themselves – whether as a savvy bargain hunter, or as a discerning consumer of quality goods whose buying decisions help them stand out from the crowd. The bottom line is, the lowest price is not always the most attractive.
“Understanding the broad types of consumer is an important starting point for price strategy. Savvy retailers are very clear on the subtleties of their target market.”
The research also shows while most shoppers (68%) consider quality more important than price, they also believe it’s easy to buy at a discount, with a significant minority (46 %) now unwilling to pay full price on any occasion.
More than three quarters of shoppers (77%) also admitted to making impulse purchases, and a 25% discount is the average trigger point to entice them to purchase.
Commenting on the findings, Commonwealth Bank national manager for retail, Jerry Macey said, “It’s interesting that consumers typically need a 25% discount to make an unplanned purchase whereas retailers generally start their promotions at 20%. It gives retailers room to move over time while using the initial discount as a form of advertising.
“Pricing clearly plays an important role in both driving sales and prompting purchase, but its important retailers remember shopper behaviour can vary widely and consider the type of consumers they are seeking to attract,” Macey said.