report on impulse buying

Research Report on Impulse Buying

SUBMITTED TO:SIR ANIS HASSAN

PREPARED BY:QURATULAIN RIAZ

MEHREEN RAZA

SIDRA TANWEER

NAJMA JAVED

- 1 -


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.

However, no study has been conducted in Pakistan to study the buying behaviour of

shoppers and what factors influence their decisions. Hence, the researchers have decided

to conduct an exploratory research to understand the general nature of impulse buying in

four main supermarkets of Karachi. This research will lay the foundation for future

researches.

- 2 -


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 behaviour have changed considerably in urban Pakistan with

women being more active in shopping now.

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

society which is considerably more advanced than Pakistan. The objective of this

research paper is to explore the incidence of and difference of impulse buying behavior in

supermarkets in Karachi, with respect to factors such as product category, grocery bill

and number of products bought, and the shopper’s gender. More importantly this paper

will help lay a foundation to build upon for future studies on impulse buying behavior in

Pakistan.

Conceptual Framework

Cobb and Hoyer (1986) and Kollat and Willet (1967) 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

- 3 -


hedonically complex and may stimulate emotional conflict. Also, impulse buying

is prone to occur with diminished regard for its consequences.” (Rook, 1987, p.

191).

The understanding of impulse purchasing was greatly improved through Stern's (1962)

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

Based on the extant literature reviewed we have defined impulse buying as done by

Engel, Kollat, and Blackwell (1968) (as cited in Piron, 1991). 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 1978).

- 4 -


Pretest questioning is not used as it forces the shopper to recite formed intentions and

commit the shoppers to their intentions (Pollay 1968). The problems with the post-

purchase operational definition are that the incidence of impulse purchases may be

understated by the shopper in an effort to appear rational. However, this definition is

easier to operationalize because shoppers will be willing to give interviews once rather

than twice (before and after shopping) and it does not create the bias in the mind of the

shoppers to follow the intention that they stated in the pre-shopping interview.

Factors Affecting Impulse Buying Behavior

Marketers have long recognized the significance of impulse buying. Empirical studies

such as Consumer Buying Habit Studies (1965) and Drugstore Brand Switching and

Impulse Buying (1965) have investigated the extent of unplanned buying in supermarkets

and drugstores and showed how different the incidences of impulse purchasing are (as

cited in Prasad, 1975).The incidence of impulse buying is increasing mainly because

consumers have accepted and adapted the methods of buying to certain merchandising

innovations and due to this interrelationship of buying to merchandising, impulse buying

will only grow significantly (Stern, 1962). We offer the following proposition.

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. Previous researches have measured

the impulse buying tendency in regards to buying “things” not specifying product

categories (Beatty and Ferrell, 1998; Puri, 1996; Rook and Fisher, 1995). Researches

have also been conducted to understand the underlying motivational factors behind

impulse buying. Similarly researches have been conducted 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 (Hausman, 2000). Mai, Jung, Lantz and

Leob (2003) found that individualist orientation was truly related to impulse buying.

Hausman (2000) has also suggested that more impulsive consumers tend to view their

buying decisions as more laborious. Consumers’ normative evaluations moderate the

- 5 -


relationship between impulse buying trait and consumers’ buying behavior (Rook and

Fisher, 1995). Here normative evaluation may be understood as consumers’ judgments

about the appropriateness of making an impulsive purchase in a given buying situation.

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 behaviour differs on many levels. Peter and Olson (1999) discuss that

men and women have been found to process information differently (as cited in Coley

and Burgess, 2003), relate to and value material possessions differently, purchase

different items for different reasons (Dittmar, Beattie and Friese 1995; Dittmar, Beattie

and Friese, 1996) and approach shopping task differently (Berni, 2001; Chiger 2001).

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 (Dittmar et al., 1996; Rook and Hoch, 1985).

On the other hand Cobb & Hoyer (1986) stated that women are more likely to exhibit

some element of planning before entering the store, whereas men are more likely to be

impulse shoppers. Hausman (2000) did not find significant correlation between gender

and impulse buying behavior.

Transaction Size affecting Impulse Buying

Stern (1962) has hypothesized circumstances that appear to be associated with the

occurrence of the behavior. 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 propositions.

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,

- 6 -


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. This was also studied and confirmed by Abratt and

Goodey (1990). In order to study the effects on the presence of a shopping list on impulse

purchase behavhior, we present the following proposition.

- 7 -


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 supermarkets of Karachi?

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.

- 8 -


HYPOTHESES

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

which we would be testing.

Hypothesis 1: There is atmost 20% incidence of impulse buying in Supermarkets of

Karachi

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.

- 9 -


RESEARCH DESIGN

Type of research

The research was of exploratory nature and involved conducting in-depth 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

Research papers were studied and online libraries such as JSTOR, EBSCO Host and

Palgrave Mcmillan were visited.

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 supermarkets covered

were:

Agha’s

Naheed

Imitaz

EBCO

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.

- 10 -


SAMPLING PLAN

Population Definition

Men and women of age 18 and above who have shopped in super markets in Karachi in

November during day time.

Sampling Frame

Four supermarkets in Karachi were selected namely Aghas, Naheed, Imtiaz, EBCO. The

shopping parties represent SEC A classification.

Sampling Unit

One shopping party.

Sampling Method

Non-probability convenience sampling (unstratified, single stage) - any shopping party

leaving the Super store after making some purchases.

Sample Size

20 respondents from each super market – aggregating to a 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.

- 11 -


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 in a four supermarkets of Karachi the findings

cannot be extended to all the supermarkets in Pakistan. Hence the findings are

only applicable to Karachi.

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.

- 12 -


RESULTS

Hypothesis 1: Incidence of Impulse buying

We used proportion test to test the significance of impulse buying in four supermarkets in

Karachi. Since we have a sample greater than 30, the Central Limit Theorem allows us to

conclude that the distribution of sample means is approximately normal and this sample

Z-test is used to measure the significance of impulse buying in the four super markets of

Karachi. According to Abratt and Goodey (1990), one in five unplanned purchase

incidences must be considered managerially significant. This was used to establish and

phrase the first null hypothesis. Our results showed that the incidence of impulse buying

is significantly greater than 20%. (The hypothesis testing is shown in Appendix)

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

According to the Chi-square statistical technique used to find the association between

gender and impulse buying behavior, we found that women have more tendencies to buy

on impulse as 78 per cent of our female respondents were found to be impulse purchasers

where as only 38 per cent of the male respondents showed impulse buying tendency. This

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.

- 13 -


M / Im16%

F / Im45%

M / Pl26%

F / Pl13%

Figure 1

Kollet and Willet (1967), 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 Karachi supermarket, the number of

products purchased by respondents has no affect on impulse 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. This finding is contrary to

what was found in the study of Impulse Buying Behavior in Vietman by Mai, Jung, Lantz

& Loeb (2001). They found that men exhibited a higher impulse buying tendency

because women needed to plan all expenses carefully so that their families’ modest

income could be spent “wisely”. We did not see this happening in Karachi probably

because our respondents mainly belonged to SEC A classification having income

comfortably above the “modest” level.

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. This was further proved by

regression analysis which gave a P value of the bill to be as high as 60 per cent hence we

can confidently reject the null hypothesis that impulse buying increases with the size of

the bill.

- 14 -


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

From our data we see that the correlation between impulse purchase and shopping bill

less than Rs. 1,000 is 25%. The correlation for bill between Rs. 1,000 and 3,000 is 7% –

almost no correlation. However for a bill size above Rs. 3,001 the correlation is negative.

This is for a bill size up to Rs. 6,000. For bill size greater than Rs. 6,000 we can

extrapolate from the observed pattern that the correlation would have been more

negative.

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

(details given below). 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 super markets in Karachi as can be seen in the

Figure 3. This was also proved by regression analysis which had R2 of 5 per cent and

high errors.

- 15 -


Percent of Unplanned Purchases

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

0 5 10 15 20 25 30 35

Different Products Bought

Perc

en

t o

f U

np

lan

ned

Pu

rch

ase

s

Figure 3

Our findings explain 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 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.

This is contrary to what was found in previous researches (Kollet & Willet 1967) which

indicated that as purchased items increase the level of unplanned impulse purchases also

increases. We found no such pattern in supermarkets in Karachi.

- 16 -


Hypothesis 5: Shopping list and Impulse buying Behavior

According to the Chi square statistical technique used to find the correlation between the

rate of unplanned purchasing with the presence of shopping list, 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.

Aghas Imtiaz Naheed EBCO TotalNever 9 9 11 6 35Sometimes 8 7 5 8 28Always 3 4 4 6 17Total 20 20 20 20 80

Table 2

Shopping list

No Shopping List

Planned 12 20 32

Unplanned 11 37 48

23 57 80

Table 3

- 17 -


List / Im14%

No List / Im 46%

List / Pl15%

No List / Pl25%

Figure 4

Kollet 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.

- 18 -


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 Supermarkets 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

- 19 -


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.

- 20 -


FUTURE RESEARCH

We have conducted an exploratory research to study the nature of impulse buying in

supermarkets of Karachi. However, the study does not extend to providing a causal

relationship between the various factors, hence future researches can conducted in those

areas.

The factors studied in our research include the gender of the shopper, size of the shopping

bill, presence of a shopping list and the number of items purchased. Future researches

may include situational factors such as mood, time and money; consumer traits and

normative traits.

Our research suggests no geographical difference in impulse buying. Hence it would be

useful to conduct future research in other cities of Pakistan to examine the differences in

impulse buying behavior between the different cities of Pakistan. Our study was only

confined to the SEC A class. Future researches can explore impulse buying in other

socio-economic classes of the population.

The findings of our research may be important from a theoretical perspective, because

they contribute to a better understanding of impulse buying behavior from the context of

a transitional economy. Our research also suggests some managerial implications

regarding promotion of impulse buying through increased physical and temporal

proximity.

- 21 -

report on impulse buying

Documents