Dissertation Title:

Dynamic In-Store Decision Making

Committee Members:

Sara Dommer (Chair), Koert van Ittersum, Sam Bond, Ryan Hamilton, J. Jeff Inman

Abstract

Much of our current understanding of how consumers shop for goods and services is based on cross-sectional analyses of end-of-trip variables (e.g., basket composition, total spending) that has largely assumed purchase behavior is constant over the course of a shopping trip, however research has begun to demonstrate how an initial purchase can influence a subsequent purchase decision. This suggests shopping behavior may not only vary throughout a shopping trip, but rather is specifically influenced by when a purchase decision occurs within a shopping trip. Furthermore, as technology now allows retailers to track, target, and engage customers at any point within a shopping experience, research is critically needed to understand how a consumer’s decisions may vary within a shopping trip.  I build on this foundation through two essays that show how and why a consumer’s in-store purchasing behavior is influenced by both the decisions they have made and the decisions they will make.

The first essay demonstrates that a consumer’s relative spending— the price of an item, relative to the prices of the other items in the same product category—evolves nonlinearly over a single shopping trip. As research has demonstrated the manner in which consumer categorize and track their spending influences their subsequent spending, I examine these spending patterns for both budget and nonbudget shoppers. Budget shoppers—consumers who shop with an explicit and consequential budget in mind—evaluate their in-store spending against a different reference point than nonbudget shoppers. The unique reference points are expected to give rise to distinct patterns in relative spending.

The second essay examines whether and how encountering promotions in-store, but temporally in advance of the promoted product influences a consumer’s redemption decision. Specifically, by building on temporal framing and attitude accessibility literature, I suggest that promotions received before and temporally separated from the promoted product may actually be more effective, and more likely to be redeemed, than traditional shelf promotions. Throughout four studies, I demonstrate that temporal promotions alter the information consumers think about when making the purchase decision. This amplifies shoppers’ evaluation of the promoted brand, subsequently influencing the likelihood that a promotion will be redeemed.