Consumers are increasingly seeing shopping as a leisure pursuit, and this casual attitude to the high street has led to a significant rise in impulse buying. Planning and saving to make major purchases is becoming a thing of the past as consumers increasingly buy on a whim.
The idea that impulse spending is on the rise is supported by research from the Future Foundation nVision. It shows that, over the past two decades, the proportion of consumers who admit to giving into temptation and buying things because they like them rather than because they need them has risen from 31 per cent to 45 per cent.
Factors such as rising affluence and easier access to credit have been crucial in reshaping consumers’ attitudes to purchase planning. The rise in disposable income has also played a significant role. The research shows that disposable income has increased by 92 per cent in real terms over the past 20 years.
Meticulous planning of expenditure and disciplined saving for large purchases, commonplace in the Fifties, is no longer the norm, either statistically or morally. Most consumers would nowadays consider it normal to enjoy a degree of spontaneity when shopping – even to “express” or enjoy themselves while shopping. Increasing affluence implies that relatively unplanned buying habits are likely to spread to include more, and higher-priced, products as time goes by.
The research provides two main insights into spending in specific sectors. Firstly, overall levels of purchase planning vary widely between sectors, with half of all shopping trips for everyday food and 37 per cent of shopping trips for “clothes for yourself (not shoes)” involving an unplanned purchase. The levels of impulse buys of mobile phones and home electronic goods drop to 12 per cent and 13 per cent respectively. This is supported by the fact that 45 per cent of shoppers claim that they gather information beforehand when buying these products. Only ten per cent of consumers research their food, toiletries and clothing purchases in advance. Secondly, the research shows that special offers play a much greater role in stimulating unplanned buys of everyday food and toiletries than they do for products in other sectors.
The age and gender of consumers is also a major factor in determining unplanned purchasing habits. Women, for instance, register significantly higher levels of unplanned buys in food, clothes and toiletries when shopping; these levels are virtually identical to those shown by men in the mobile phone and home electronics sectors. Young people are far more likely to buy clothes spontaneously, whereas 55- to 64-year-olds are the prime unplanned-purchasers of toiletries, and also make fairly frequent unplanned buys of food.
While gender is one strong predictor, impulse buying appears to decline with age – with the very notable exception of the 55- to 64-year-old age group. Social grade and household income do not emerge as clear predictors: poorer households are more likely to report unplanned buys of food (even without special offers), but less likely to make unplanned purchases in other sectors. This suggests that income is not the key to segmentation, despite its important historical role.
It is “surplus” income that may have more impact on shopping behaviour. Younger consumers and 55- to 64-year-olds may stand out because, unlike parents and pensioners, these are age groups characterised by a large surplus of income over “basic” expenditure.
Meanwhile, of course, the retail environment itself is crucial to stimulating impulsive or unplanned buys. Clearly, the degree of involvement a consumer is made to feel in the sector – or in shopping generally – is the best predictor of all. Of those shopping trips where the shopper enjoyed the experience, 28 per cent involved an unplanned buy not owing to a special offer; just 11 per cent of unenjoyed trips did so.
Social shopping with friends or adult family is also a predictor of impulse buying, whereas visiting only a single shop is associated with a lower likelihood.
Lastly, the research shows that confusion can also be linked to impulse buying. Although it may seem paradoxical, the highest likelihood of an unplanned purchase is during those shopping trips that consumers describe as difficult or stressful.
However, as disposable income grows, it is increasingly unnecessary to “hustle” consumers into unplanned purchases. Both spontaneous buys and loyalty can accrue to those retailers that can manage to entice consumers into an expansive mood.
The rise in impulse buying does not automatically mean that purchase planning is a spent force in shopping, particularly as internet comparison services may make prior purchase planning more effective when it does happen. But high street shopping is likely to become characterised less by planned purchasing as the level of impulse buying increases, and retailers need to recognise this trend and react appropriately.
Retailers, particularly of key impulse items such as food and clothing, will need to develop their in-store environments to help make the most of the shopping experience. Retailers in sectors where planned purchases still dominate, such as home electronics, should learn from other sectors and work to encourage more spontaneity in their stores.