Business and Operations
Acting on impulse
By Michelle Brisebois
By Michelle Brisebois
Impulsiveness is generally frowned upon. From the time we’re small
children, teachers, preachers and parents all tell us that good things
happen when cooler heads prevail.
Impulsiveness is generally frowned upon. From the time we’re small children, teachers, preachers and parents all tell us that good things happen when cooler heads prevail. Human beings, however, sometimes just like to do what feels good in the moment. It’s a character trait that retailers love because it has a positive impact at the cash register.
|Keep candles, confetti and party decorations at your store to make it easy for your customers to prepare for their party.|
According to the U.S. Department of Commerce, recent studies estimate that about 40 per cent of consumer spending is impulse buying and that number may be even higher for food. A Dupont Study done several decades ago reported that impulse purchases accounted for 50 per cent of grocery store sales. There is, however, an art to the up-sell.
You must choose your add-ons carefully; otherwise, you might just undercut your core business.
For customers who planned to come to your bakery, your strategy will be to offer items to purchase in addition to their expected purchase. You ideally want items that complement your core business, not cause the customer to buy it instead of your primary offering. A women’s clothing store will carry jewelry and scarves to bump up the sale. A wine store will sell corkscrews and stemware. As a bakery, you may wish to look at premium jams to go with your breads or coffees that pair with your chocolates. Cutting boards, beautiful serving plates and pie lifters would all complement your offering without taking away from the product itself. Assuming you sell birthday cakes, you should also carry candles, sparklers and balloons to make it easy for the customer to create an instant party. Single servings of cupcakes or brownies could entice an impulse purchase if they were shown with a shelf talker that simply said, “Why not take one for the road?”
For customers who hadn’t planned to come into your shop, it’s about intercepting and enticing them to come in and make a purchase. Smell is your friend here, as your most powerful seductress is a fresh-baked goodie beckoning customers towards you. The New York Sense and Smell Institute discovered that vanilla has a calming effect on shoppers. If your bakery is part of a mall or closed space you can take advantage of smell as your lure but if you’re a stand-alone store, words and pictures will need to tell the story. Fortunately, baked goods look great visually. Upon going into banking as a marketer I used to joke about how I missed the days when I could put a glamour shot of a hot, steamy cinnamon bun on a poster and call it a day. Try enticing people to obtain a chequing account with a picture! Bakery-specific words that lure include: fresh, delicious, vanilla, chocolate, decadent, rich. Other advertising power words that punch above their weight include: new, imagine, you and discover. Try a simple chalkboard message on the sidewalk that combines as many of these enticing words as possible. For example: “Discover our new, decadent cinnamon bun” or “Delicious flavours of vanilla, cinnamon and cream cheese. You deserve it.”
Once the customer is ready to buy an impulse item, there’s the question of price. There’s much debate on whether or not a sale price is the holy grail of impulse purchasing. While consumers may report that a discounted price makes them purchase impulsively, the data from online shopping suggests otherwise. According to the Yankee Group (November 2000), 75 per cent of survey respondents indicated that a “special sale price” would motivate them to make a spontaneous purchase. The second most motivating factor reported was free shipping with 49 per cent of respondents. The study of actual purchases online revealed that very few impulse purchases were driven by promotions. The study looked at a cross-section of online retailers including pet stores, apparel stores and computer accessory stores. The researchers discovered that impulse purchases were for a variety of items, none of which were special promotions or products on sale. Impulse purchases were simply items that the shoppers thought of while shopping for other items. Remember, acting on impulse is usually done because it makes the purchaser feel good, so while price is an important consideration, it’s not necessarily the card you lead with.
Choose items that make the customer feel better about their main purchase and make sure the price for the add-on is proportional to the purchase. This means that if it’s a $30,000 car, $15,000 hubcaps may be an easy sell. If it’s a $300 suit, the $40 scarf works as an add-on. However, a five-dollar loaf of artisan bread could easily drive a premium jam purchase of five to eight dollars given that the total spend for the customer is still under $20. There aren’t any hard and fast rules. You’ll need to look at your average sale and estimate how much extra a customer may be willing to spend without sacrificing your core business. If the impulse purchase is too attractive and priced proportionally high to your core item, you may see sales of your add-ons cannibalize your main offering.
With a strong and strategic effort to increase impulse purchases, your bakery will quickly benefit from those additional sales. Just observe your clientele for clues as to what will work and at which price point. Whatever you do, don’t overthink it; just do it. It may end up being the best impulse you’ll ever have.
Tips to take away
- Have lots of add-ons available. If you sell cakes and cupcakes, be sure to have candles, sparklers, balloons and other decorations available to offer your customer a one-stop shop for party supplies.
- Promote single servings. Single servings of brownies or cake pops advertised with a shelf talker that reads “Take one for the road” could entice an impulse buyer.
- Use buzzwords. Discover, imagine, and new are all buzzwords that should be incorporated to your signage. Combine as many as possible to maximize success.
Michelle Brisebois is a marketing professional with experience in the food, pharmaceutical, financial services and wine industries. She specializes in retail brand strategies.