Poster - FINAL FOR TURNITIN

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Our initial thought for a study was whether supermarket consumers are drawn more toward the price or packaging. With this in mind, we turned to the literature to see if there was research on this topic. We found twelve articles to assist us in proceeding further with our research project. A comprehensive model of buying behavior was used to prove that random choice is not how consumers select a brand. Method Discussion Consumer Preferences in Retail Grocery Buying Amy Petit, Dorothy O’Neill, Karen Netherlain, and Rachel Johnson Azusa Pacific University, Graduate Psychology Chart #1 Chart #2 References Literature Review Results Participants were 31 male and female adults. Participants were selected from friends, family members and graduate students at Azusa Pacific University. Participants were from the U.S.A. and the U.K. The selection of the participants was not random; all participants were known to the researchers. Of the 55 surveys we sent out, 31 people participated. Results of the descriptive survey were analyzed with the percentages and bar graphs that Survey Monkey offers. Our hypothesis was that when purchasing items at a grocery store, packaging/brand is the primary influential factor when making product choices, and price is the second most important. The hypothesis for this study was, “If packaging is the same for all brands of a product, then customers will buy the cheapest brand of the product.” The focus was on retail grocery products. We believed that packaging would prove to be a more significant purchasing factor than price, with price being the second-most influential factor. Ampuero, O., Vila, N. (2006). Consumer Perceptions of Product Packaging [Electronic version]. Journal of Consumer Marketing , Vol 23(2), 102-114. Retrieved from http://web.ebscohost. com/ehost/detail?hid …

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Literature Review Our initial thought for a study was whether supermarket consumers are drawn more toward the price or packaging. With this in mind, we turned to the literature to see if there was research on this topic. We found twelve articles to assist us in proceeding further with our research project. A comprehensive model of buying behavior was used to prove that random choice is not how consumers select a brand. While this extensive model is not directly related to our study, it does explain that there are subjective variables which affect purchasing (Goodhardt, 1984). It is not simple accidents which lead people to buy items. Further analyzing behavior, we turned to Piaget’s developmental model. One study explored how children choose different brands of cereal. There were numerous discoveries, with consistencies and inconsistencies, after the study. However, the article reinforces that brand recognition is one of the attributes which affect consumer choice (Bahn, 1986). When delving into consumer preferences, there are environmental stressors that affect consumer behavior. Some individuals may be struggling with employment, and shortages of cash due to the recession in the US. One article indicates that “in many product categories, not only have an average of 18% of consumers tried reduced-price offerings, but a significant proportion of these say they were pleased with how the cheaper products performed”(Bohlen, 2010). Therefore, consumers are sometimes choosing options that would not have been their first choice based on the price. Other factors that influence vary among demographics. Some factors listed are quality, freshness, taste, healthy diet, price, household preferences and habits. However, in one Turkish study, results show “that among the factors influencing food choice for Turkish consumers, price is the most significant factor in all the clusters” (Topcu, 2009). Further studies which explored global consumer attitudes identified nutritional labels on food as a major factor. They state that “about 58% of consumers say they use the Nutrition Facts Panel when deciding to buy a certain food or beverage, especially when making first-time purchases or comparing two products with similar prices or front-of-the-package claims” (Wills, 2009).

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Literature Review Transitioning to consumers perceptions about product packaging, we learn that a products design appeal influences a purchasing decision (Ampuero, 2006). One example supporting this was a study done with consumers purchasing wine based on the attractiveness of the label. “Overall, label style and brand evaluation were the strongest drivers for informed liking following by the liking in the blind condition. Purchase intent was influenced directly only by informed liking and price evaluation” (Mueller). While this was for a specific product in German cities, we still gather a good sense about consumer’s preferences. Brand recognition is another important factor to keep in mind. Some might have grown up with a specific brand and therefore are loyal to the brand. There was a study that set out to investigate the highest price brand-loyal customers would be willing to pay over expectations in order to remain loyal. The study demonstrated that “recognizable brands are able to attract more buyers than lower-priced unknown brands, even among bargain shoppers” (Jensen). So, even in rushed situations the consumers are willing to pay more for the preferred brands. Additionally, “consumers who attribute more importance to quality buy the brand name product, while others buy the less expensive unlabelled product” (Wolinksy, 1987). Further trying to understand customer loyalty a company tried enticing consumers to switch brands by giving them rewards. They noticed that “when firms can commit to future prices, consumer loyalty is rewarded if preference dependence is low; but enticing brand switching occurs if preference dependence is high” (Chen, 2010). Consequently, firms and companies also have an influence. It is important to understand what drives store-brand success and what motivates retailers to introduce store brands. We learn that an introduction of the store-brand influences the retailers pricing behavior, which in turn should have an influence on the consumer’s choice in purchasing goods (Chintagunta, 2002) Overall, our research showed us that various factors contribute to consumers purchasing preferences. While packaging and price are large influences, we remember that the product, quality, and environment also affect our consumer’s choices. So, in order to assess consumer’s perceptions researchers should design a valid and reliable test or survey (Mackison, 2010).

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Method Participants were 31 male and female adults. Participants were selected from friends, family members and graduate students at Azusa Pacific University. Participants were from the U.S.A. and the U.K. The selection of the participants was not random; all participants were known to the researchers. Participants were selected for inclusion in the experiment if they shopped for groceries. The age of the participants was between 25 and 60 years. Materials included a descriptive survey. This survey was a preliminary collection of questions developed by the research team in the formats of multiple choice, Likert -type scale, forced-alternative, and open-ended questions. A blog page was established by the researchers as a location for ongoing dialog between the researchers and for posting information pertinent to the survey. Participants’ e-mails were posted on the blog site. (The team used administrator settings to restrict access to the blog.) The e-Course web page was accessible to the team for monitorig the time frames and structure of the research. Researchers met to determine a final hypothesis that would be submitted to the IRB for approval. After the researchers submitted their hypothesis to the IRB, they received approval to proceed. The group then worked together to finalize questions that would be placed on the survey, which would then return data to support the hypothesis. After identifying the questions, the researchers submitted them to O.I.R.A. for approval. Upon receiving the O.I.R.A.’s approval, the researchers set up the survey in SurveyMonkey and sent a survey link to selected participants, along with a release notice. When the participants submitted their survey responses, the results were collected and analyzed by Survey Monkey. The researchers used the data returned by SurveyMonkey to perform calculations. Charts were made based on the calculations. The researchers posted the charts on their team blog.

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Results Of the 55 surveys we sent out, 31 people participated. Results of the descriptive survey were analyzed with the percentages and bar graphs that Survey Monkey offers. Our hypothesis was that when purchasing items at a grocery store, packaging/brand is the primary influential factor when making product choices, and price is the second most important. Our data supports that, for most of our respondents, price is generally the most important factor. Packaging/brand matter less, with a few exceptions. Although results were split, Chart 1 supports this finding with 71% indicating that price most often drives their purchase choice, whereas 29% say purchases are driven by packaging/brand . As you can also see, Table 1 ( M = 1.29, SD = 0.46) shows that price was most often chosen over packaging/brand for Item #1. However, Chart 2 directly supports our hypothesis, showing that “if a grocery store’s generic and brand name products had identical packaging,” 68% would choose the cheaper, generic brand, yet 32% (6% habit + 26% trust) would remain brand loyal. According to Chart 3, the important factor for consumers when it comes to packaging/brand, has nothing to do with the aesthetics of the packaging, but more to do with the reputation a certain brand has for either good taste, quality, consistency, or good nutritional value. Therefore, it is necessary to consider that, when participants made their respective choices, they may have had assumptions in mind about said generic product. For example, they may believe, “Quality/taste is just as good.” Qualitative answers supported the participants’ choices of the qualitative portion of the survey. There were approximately six different reasons given for our participants to buy the generic product over the name brand they prefer: saving time; buying a non-food item; health advantages; quality/taste is similar; equivalent ingredients; name brand unavailable; need to buy in bulk; save money. Of these reasons, “quality/taste of the generic product is similar” to the name brand they normally prefer, was by far the most given reason. This finding correlates with Item #3 on the survey, where approximately two-thirds (64.5%) of the respondents said the reason they purchase a grocery store item because of lower price is that “sometimes the cheaper product is just as good,” with around one-third (35.5%) attributing this choice to the poor economy and needing to conserve money.

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Results Taste/quality of product was shown to be the substantial reason again when participants were asked when they would be willing to spend more money on a product over the cheaper brand. A reason almost equally given was that the more expensive product is healthier or organic. Other, less given reasons included: the product gave them better results (generic shampoo and face wash), the product was made in the United States, and there was more familiarity with the more expensive product. The specific products that participants said they were willing to spend more money on included meat, dairy, eggs, fruit, vegetables, ice cream, cookies, chips, and toilet paper. Table 1 includes the means and standard deviations for 6 of 7 of our quantitative questions. The results shown in Table 1 reflect a wide range of factors that influence consumer purchasing decisions, as we had discussed in formulating our hypothesis. These were various reasons that we personally experienced when buying products, as well as reasons stated in the literature we reviewed. As Table 1’s statistics shown, the many reasons cannot be narrowed down. Item #5 was developed to determine a ranking of those reasons. However, this item was considered invalid and, therefore, thrown out before analyzing the collective data. It was discovered the design of this item may have been faulty when we realized that not all the participants answered this item in the way it was designed to be answered. The survey item was designed to be a matrix of choices (only one answer per row), where participants rated five decision factors when purchasing products at the grocery store. They were asked to give each of the five factors a number (5-1) rating them from most influential to least influential. During the survey collection period, a few of the participants complained to one of our researchers, stating they did not understand why they could not give more than one option an importance level of “5” or “3,” and so forth. It is unclear as to why this question caused confusion; one explanation could be that perhaps the item gave unclear directions in the prompt. Again, in the end, the data collected for this item was not consistent or reliable because not every participant rated each factor ( N ≠ 31), so the question was disqualified. Two demographic questions were included to see if there was possibly any correlation found between income, number of people to feed on that income, and factors for product choices when grocery shopping. Table 1 shows that the average household has 2 members, and that the average annual income ( M =3.36, SD= 1.67) is somewhere between $70,000 and $90,000. Standard deviation indicates most of the participants make more than $90,000 annually. Income levels are also depicted on Chart 4.

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Results “Middle class income for Californians” was researched online, but no clear, substantial, or reputable findings were discovered. Some of the participants, perhaps single, graduate students, might consider $90,000 to be a high annual income, while others that perhaps are working-class professionals, or rely on two incomes may not. Either way it is judged, the data is clear that price is the most important factor for most of the participants when grocery shopping. Furthermore, some people who make over $90,000 per year still consider price a substantial determinant when making grocery store purchases.

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Chart #1

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Chart #2

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Chart #3

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Chart #4

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Table #1

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Discussion The hypothesis for this study was, “If packaging is the same for all brands of a product, then customers will buy the cheapest brand of the product.” The focus was on retail grocery products. We believed that packaging would prove to be a more significant purchasing factor than price, with price being the second-most influential factor. We reviewed literature and found a certain amount of support for the direction of our hypothesis. Literature searches focused on “consumer behavior” and “purchasing psychology.” In formulating survey questions, we were curious what we might learn about why consumers choose one product over another. Based on a hypothetical scenario in which we sold a brand of retail grocery products called “Belles Passionates,” we sought to determine which marketing efforts to fund. Primary considerations were price, packaging appeal, taste, and nutrition. The survey questions were directed at value as well as price. People known personally to us, such as friends and colleagues, were invited by email to answer 10 questions posted by SurveyMonkey ( www.surveymonkey.com ). Approximately 56 % of invitees responded. The results did not support our hypothesis. In fact, the consumer group represented by our population sample chose packaging over price more than 3.4 times as often . The current economy and the lifestyle of the surveyed group may contribute to this disparity. Most respondents reported a household size of 3 or less, and household annual income of either under $50,000 or over $90,000, (slightly more often, the latter). Some participants told us privately that they preferred not to answer a question about income, and admitted to not answering honestly for that reason; therefore, this statistic may not be correct. Participants are geographically and culturally diverse. Slightly less than half of the invited participants are APU graduate psychology students, which may account for the split. Surprisingly, the results did not point to any particular area of marketing focus. Instead, a varied range of stated preferences would make it difficult to respond to our initial hypothetical scenario. Consumers reported an almost equal interest in brand names as nutritional buzz words, yet none for package attractiveness. Participants reported that, when price is not a factor, they seek quality/taste and nutritional value . The surveyed population is typically willing to spend more for specific preferred products in order to get their money’s worth in flavor, nutritional value, and consistency.

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Discussion In examining the validity of the results, broader circumstances were considered. Because the survey was released on the same day as the earthquake in Japan, participants may have responded differently than they might have answered at a calmer time. This setting reflects a possible threat to internal validity in the form of history. The recent unrest in the Middle East and struggling U.S. economy underscored this distress. Current events, both near and far, could affect how participants respond to questions regarding purchasing decisions. The results of our study have low generalizability due to population size, population selection, and method. The sample population size is low and represents individuals whose lifestyles are similar to our own. Given the low population size, it is possible for results to be skewed by statistical regression if a few participants responded dramatically differently from the majority. A weakness of our method is that data collected was from self-reporting and is not validated by retail purchase records. The validity of our data is high, however, because the participants are personally known to the research team; thus, environment was controlled by selection of participants who would take the project seriously. Future research would examine larger populations and broader demographics, such as urban and rural areas, as well as other socio-economic groups. If the results proved similar, the study may be generalizable to the general population. It would be interesting to engage in a more complex research effort that involved data from retail store transactions. Survey data might be substantiated by the examination of those variables. This study could easily be replicated for use in same size and larger populations. It would facilitate further studies on consumer behavior and product pricing. The data obtained is relevant to marketing research studies and business planning. Lessons learned in this study include the importance of clear communication among team members. Varying schedules and geographic constraints were not as much a problem as getting a consensus on project direction. In a few instances, we made assumptions that undid our efforts. However, meeting in person to choreograph certain facets of the project resolved confusion.

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Discussion It was difficult to create this study and survey without using a specific product. For example, it was more a struggle to apply our hypothesis to all retail grocery purchasing preferences. Using only one category would likely yield more concrete results. Alternatively, the use of substantially more questions, such as about a range of products and/or circumstances; however, this method may be taxing to the participants, leading them to drop out. Because participants pointed out that a preference for privacy in terms of their personal financial information, even with an anonymous survey, we would change the options available for any personal question. In future surveys, we would allow an option of “prefer not to answer” on any demographic question.

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References Ampuero , O., Vila, N. (2006). Consumer Perceptions of Product Packaging [Electronic version]. Journal of Consumer Marketing , Vol 23(2), 102-114. Retrieved from http://web.ebscohost.com/ehost/detail?hid=12&sid=ec9d02ee-ba5e-49a3-b62f-0d350dafd058%40sessionmgr14&vid= 5&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db= psyh&AN =2006-04518-006 . Bahn , K. D., (1986). How and When do Brand Perceptions and Preferences First Form? A Cognitive Developmental Investigation [Electronic version]. The Journal of Consumer Research , Vol. 13, 3, 382-393. Retrieved from http://0- http://www.jstor.org.patris.apu.edu/stable/2489429?&Search=yes&searchText=Brand&searchText=Bahn&searchText=name&searchText=brand&list=hide&searchUri=%2Faction%2FdoBasicSearch%3Facc%3Don%26Query%3D%2528%2528How%2Band%2BWhen%2Bdo%2BBrand%2529%2BAND%2B%2528brand%2Bname%2529%2BAND%2B%2528Bahn%2529%2529%26gw%3Djtx%26acc%3Don%26prq%3D%2528%2528generic%2Bpackaging%2529%2BAND%2B%2528brand%2Bname%2529%2BAND%2B%2528Bahn%2529%2529%26Search%3DSearch%26hp%3D25%26wc%3Don%26acc%3Don&prevSearch=&item=1 &ttl=96&returnArticleService=showFullText . Bohlen, B., Carlotti , S., & Mihas, L. (2010). How the recession has changed US consumer behavior [Electronic version]. McKinsey Quarterly , 1, 17-20. Retrieved from http://0-web.ebscohost.com.patris.apu.edu/ehost/detail?hid=17&sid=60884562-f0a5-42ec-a537-c8b79ccca540%40 sessionmgr 11&vid=4&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db= bsh&AN =47918189 . Chen, Y., Pearcy , J. (2010). Dynamic pricing: when to entice brand switching and when to reward consumer loyalty [Electronic version]. RAND Journal of Economics , Vol. 41, 4, 674-685. Retrieved from http://0-web.ebscohost.com. patris.apu.edu/ ehost / detail?hid =17&sid=60884562-f0a5-42ec-a537-c8b79ccca540%40sessionmgr11&vid=4&bdata= JnNpdGU9ZWhvc3 QtbGl2ZQ%3d %3d#db= bsh&AN =55048334 .

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References Chintagunta, P. K., Bonfrer, A., and Song, I. (2002). Investigating the Effects of Store-Brand Introduction On Retailer Demand and Pricing Behavior [Electronic version]. Management Science , Vol. 48, 10, 1242-1267. Retrieved from http://0-www.jstor.org.patris.apu.edu/stable/ 822635?&Search=yes&searchText=ingredients&searchText=pricing&searchText =product &searchText=packaging&searchText=behavior&searchText=label&searchText=consumer&list=hide&search Uri=%2Faction%2FdoBasicSearch%3Facc%3Don%26Query%3D%2528%2528consumer%2Bbehavior%2529%2BAND%2B%2528product%2Bpackaging%2529%2BOR%2B%2528label%2529%2BOR%2B%2528pricing%2529%2BOR%2B%2528ingredients%2529%2529%26gw%3Djtx%26acc%3Don%26prq%3D%2528%2528consumer%2Bbehavior%2529%2BAND%2B%2528product%2Bpackaging%2529%2BOR%2B%2528label%2529%2BOR%2B%2528pricing%2529%2BOR%2B%2528ingredients%2529%2529%26Search%3DSearch%26hp%3D25%26wc%3Don%26acc%3Don&prevSearch=&item=1&ttl=161913&returnArticleService=showFullText . Goodhardt, G. J., Ehrenberg, A. S. C., and Chatfield, C. (1984). The Dirichlet: A Comprehensive Model of Buying Behaviour [Electronic version]. Journal of the Royal Statistical Society . Vol. 147, 5, 621-655. Retrieved from http://0-www.jstor.org.patris.apu.edu/stable/2981696?&Search=yes&searchText=Model&searchText=Behaviour&searchText=Buying&searchText=Comprehensive&searchText=Dirichlet&list=hide&searchUri=%2Faction%2FdoBasicSearch%3Facc%3Don%26Query%3D%2528The%2BDirichlet%2B%2BA%2BComprehensive%2BModel%2Bof%2BBuying%2BBehaviour%2529%26gw%3Djtx%26acc%3Don%26prq%3D%2528%2528generic%2Bpackaging%2529%2BAND%2B%2528brand%2Bpackaging%2529%2BAND%2B%2528The%2BDirichlet%2B%2BA%2BComprehensive%2BModel%2Bof%2BBuying%2BBehaviour%2529%2529%26Search%3DSearch%26hp%3D25%26wc%3Don%26 acc%3Don&prevSearch=&item=1&ttl=36&returnArticleService=showFullText . Jensen, M., Drozdenko, R. (2008). The changing price of brand loyalty under perceived time pressure [Electronic version]. Journal of Product & Brand Management, Vol. 17, 2, 115-120. Retrieved from http://0-web.ebscohost.com.patris.apu. edu/ehost/detail?hid=18&sid=ac18434b-d384-46a9-9a6d-542a2f3139cb%40sessionmgr10&vid=9&bdata=JnNpdGU9Z Whvc3QtbGl2ZQ%3d %3d#db=bsh&AN=33394693 . Mackison, D., Wrieden, W. L., and Anderson, A. S. (2010). Validity and reliability testing of a short questionnaire developed to assess consumers’ use, understanding and perception of food labels [Electronic version]. European Journal of Clinical Nutrition, Vol. 64, Issue 2, 210-217. Retrieved from: http://0-search.ebscohost.com.patris.apu.edu/login.aspx?direct=true&db =aph&AN=47846445&site= ehost-live .

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References Mueller, S. (2010). The Relative Influence of Packaging, Labeling, Branding and Sensory Attributes on Liking and Purchase Intent: Consumers Differ in Their Responsiveness [Electronic version]. Food Quality and Preference , Vol. 21(7), 774-783. Retrieved from http://0-web.ebscohost.com.patris.apu.edu/ehost/detail?hid=21&sid=8b41f31f-c2cc-4312ba1751571 f4b5c47%40sessionmgr14&vid=3&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=psyh&AN=2010-17247-001 Topcu, Y., Isik, H. B., Uzundumlu, A. S. (2009). Turkish consumer attitudes toward food products: the case of Erzurum [Electronic Veresion]. Italian Journal of Food Science, Vol. 21, Issue 1, 37-50. Retrieved from http://0-search.ebscohost. com.patris.apu.edu/login.aspx?direct=true&db=aph&AN=37275513&site=ehost-live Topcu, Y., Isik, H. B., Uzundumlu, A. S. (2009). Turkish consumer attitudes toward food products: the case of Erzurum [Electronic Version]. Italian Journal of Food Science, Vol. 21, Issue 1, 37-50. Retrieved from http://0-search.ebscohost. com.patris.apu.edu/login.aspx?direct=true&db= aph&AN=37275513&site=ehost-live . Wills, J. M., Schmidt, D. B., Pillo-Blocka, F., Cairns, G. (2009). Exploring global consumer attitudes toward nutrition information on food labels [Electronic Version]. Nutrition Reviews, Vol. 67, 102-106. Retrieved from http://0-search. ebscohost.com.patris.apu.edu/login.aspx?direct=true&db =hxh&AN=38219170&site=ehost-live . Wolinsky, A. (2009). Brand Names and Price Discrimination [Electronic version]. Retrieved from http://0-www.jstor.org. patris.apu.edu/stable/2098633?&Search=yes&searchText=generic &searchText=packaging&searchText=name&searchText =wolinsky&searchText=brand&list=hide&searchUri=%2Faction%2FdoBasicSearch%3Facc%3Don%26Query%3D%2528%2528generic%2Bpackaging%2529%2BAND%2B%2528brand%2Bname%2529%2BAND%2Bwolinsky%2529%26gw%3Djtx%26acc%3Don%26prq%3D%2528%2528generic%2Bpackaging%2529%2BAND%2B%2528brand%2Bname%2529%2529%26hp%3D25%26wc%3Don%26acc%3Don&prevSearch=&item=1&ttl=5&returnArticleService=showFulText