How to capitalise on impulse purchases this 2020
Written by Josefina Daly ·
Have you ever stopped to think about which products are purchased on impulse the most? Or how consumption habits change according to generations? At Geoblink we wanted to investigate and discover the new trends and strategies that influence this type of shopping. Our research uncovered insightful findings, keep on reading to see what we found out!
Impulse purchases can account for up to 16% of total store sales. Therefore, many brands have designed a strategy to maximize the potential of those products making it impossible to stick to the shopping list. Take, for example, the case of IKEA. Have you ever noticed the fact that their stores have a unique labyrinth-shaped route? One of the purposes of this is layout is precisely to expose consumers to as many products as possible and thus “tempt” them to buy.
Here’s a video that explains the strategy behind this iconic brand:
This example allows us to identify some key factors when designing an impulse channel strategy, but… can we all stick to the same strategy? To what extent can these be static? In today’s changing world, it is important to stay updated on new trends in the business world and implement actions that allow us to differentiate ourselves from the competition.
Did you know that the majority of consumers (59%) said they initially discovered products while browsing online channels? However, when it comes to the final conversion, online is the least effective medium at garnering impulsive purchases with only 22% of survey participants sharing that this is where they made their impulse purchases.
According to Business Insider, recent trends in ecommerce suggest that this could change in the near future: “The consumer packaged goods (CPG) sector, which has long depended on encouraging consumers to make impulse purchases in stores, is changing its focus to attract online shoppers.
So… what’s happening with unplanned shopping? Which categories are most demanded? In order to connect consumer goods companies with the end consumer, we surveyed 300 people in the UK and UK and dug into the main trends that are influencing impulse buying in the food, beverage, fashion, personal care and electronic accessories categories. One of the main findings indicates that 73% of consumers pick up unplanned food items.
Sociodemographic factors: Preferences across generations
We’ve heard a lot about the differences between generations, but how does this influence impulse buying? The survey, completed on 11 October 2019, provides interesting data on their preferences.
Did you know that Millennials are the most impulsive generation out of them all? So much so that 7% admitted to having purchased more than 11 items without previous planning during the last week. Brands targeting this particular consumer demographic with a variety of products in their portfolios have a major opportunity to generate more “impulsive revenue” via cross-selling and take advantage of this trend.
Promotion: actions that translate into conversion
When analysing the quantitative results, we found relevant information regarding promotion strategies, answering questions such as what are the main sources of information to finding out about new products; what advertising is considered more effective when it comes to promoting impulse purchases or how to align online and offline in order to optimize omnichannel strategies.
Did you know that the physical store still reigns supreme when it comes to boosting impulse purchases? 65% of survey respondents affirmed that discounts or promotions in-store are the primary drivers leading to impulsive shopping.
A great example of this is Costco, a wholesale supermarket, which stands out for its in-store strategies to encourage impulse buying. The company relocates its products constantly, making consumers unconsciously participate in a “treasure hunt,” in which they are exposed to countless products that are not part of their shopping list but will end up in the cart regardless. Costco also places products together that ostensibly do not belong to the same category, but are nevertheless complementary purchases. With these simple techniques, the U.S. distributor’s sales continue to grow (7.9% more than the previous year).
In short, creating a conducive environment that successfully promotes impulsive buying is all about balancing the 4 P’s: putting the right products in the right places, pricing them adequately and strategically promoting them.
Would you like more information on the 5 categories analysed and the new consumer trends? In our report, you will find all this and much more. Download it to find out how to make impulse purchasing more profitable.