I don’t buy 10 cartons of Yoplait because I can’t (won’t) eat 10 cartons of yogurt before they go bad. I’m lucky if I can eat my way to the bottom of one carton. So when my local Food Lion has a great deal on yogurt, I tend to pass. From a shopper marketing perspective however, such outlier behavior is generally atypical of how middle America reacts to a ten for $10.
The Times had a good article about multiples this morning, and here’s a quick birdsong gregory exegesis.
Using buying patterns detected from loyalty cards, receipts, and other research, grocery chains are searching for the multiples sweet spot. For example, Kroger currently has lemonade, socks and Kroger gummi bears candy on sale at 10 for $10. And, to the chagrin of right-brained finger counters everywhere, the old gimmick — buy one, get one free — has been expanded to include some pricing equations based on complex NASA-inpsired algorithms – or at least it appears so to my mathematical challenged mind.
Most grocery shoppers make a list before going to the store, according to two recent studies, In one, Acosta Sales and Marketing, which advises clients like Nestlé on pricing, found that 84 percent of shoppers make a list, 23 percent make fewer grocery trips than a year ago, and that, over all, shoppers are spending less per trip than a year ago.
Then, throw unemployment, rising gas prices and more expensive food into an already meager stew, and you get consumers who have become extremely value driven, budget minded, list minded, less impulsive, and very deal oriented. So in order to get someone to buy something that wasn’t on their list (or more of what was), grocers like our client Bloom need incentives to nudge shoppers outside their typical behavior. And it’s working.
Well advertised, relevant multiples push customers a little higher than their typical purchase rate. People tend to buy the amount, or buy in increments, that are advertised – ten boxes of tortellini for $10, for example. According to John T. Gourville, professor of marketing at Harvard Business School who studies pricing strategies, even though shoppers usually do not have to buy the suggested amount to get the discount, they do anyway. “It is all about the power of suggestion,” he said.