Spending on the Fly: Mental Budgets, Promotions, and Spending Behavior

Abstract

Recent research has suggested that consumers have in-store slack for grocery trips-that is, they leave room in their mental budgets to make unplanned purchases. Drawing on this work, this article examines how the impact of promotions depends on whether the shopper still has in-store slack remaining in his or her mental budget. Specifically, the authors evaluate how the effect of promotional savings for both planned and unplanned items on spending varies as a function of whether the item is purchased before or after the shopper's in-store slack is depleted. In addition, they examine how these relationships vary depending on income. To achieve these goals, the authors conducted a field study in which respondents used a handheld scanner to record the order of purchases. The results suggest that savings on planned items lead to stockpiling by higher-income shoppers when the savings occur before the in-store slack has been depleted but lead to increased purchase of unplanned items when they occur after in-store slack is depleted. The results also show that promotions on unplanned grocery items generate incremental spending at the basket level, which increases with income but only when the item is purchased after the in-store slack is exceeded. The authors discuss implications for shopper marketing strategies.

The Impact of Mobile Device Use on Shopper Behaviour in Store: An Empirical Research on Grocery Retailing

“…Shoppers using devices in a shopping-related manner may better provided to track items or to evaluate spending. The amount remaining in the budget during a shopping expedition influences consumer decision making and spending (Stilley, Karen, Inman & Wakefield, 2010). As a consequence, consumers who perceive a budgetary surplus make more unplanned purchases (Beatty & Ferrell, 1998).…”

“…Previous research stated the key role that in-store stimuli and displays play in influencing shoppers (Inman et al, 2009;Stilley et al, 2010;Inman & Sciandra, 2013), acknowledge the impact that technological distraction can have on individuals' visual attention and state the distractive nature of mobile technologies, resulting in shoppers missing in-store cues (Strayer et al, 2003;Hyman et al, 2010;Inman & Sciandra, 2013). According to these findings, we state our first hypotheses: H1: Consumers using mobile devices in store will be less able to recall marketing stimuli produced by retailers in the retail setting, compared to consumers not using mobile devices.…”

“…The role of in-store stimuli in influencing shoppers' behaviour inside the point of sales is well studied in marketing literature (Inman et al, 2009;Stilley et al, 2010;Inman & Sciandra, 2013). Recently, many authors have increased their attention on the impact that technological distraction can have on individuals' attention towards marketing stimuli, stating the distractive nature of mobile technologies (Strayer et al, 2003;Hyman et al, 2010;Inman & Sciandra, 2013).…”

What is the Right Supply Chain for Your Shopper? Exploring the Shopper Service Ecosystem

“…), the impact of in‐store promotions and price on bargain‐oriented shoppers (Stilley et al. ), and the desired pleasure of in‐store experiences for the social shopper (Cox et al. ) all have implications for supply chain design and operational execution.…”

Determinants of Advertising Effectiveness: The Development of an International Advertising Elasticity Database and a Meta-Analysis

“…Promotions give consumers incentives to act faster (Ramanathan and Dhar 2010;Stilley, Inman, and Wakefield 2010). Sometimes perceived as a gift (Van den Putte 2009), they enhance sales more instantaneously and often to a greater extent than other elements of the marketing mix do (Blattberg and Neslin 1990).…”