Posts tagged ‘grocery’

Grocery Store Designs are Based on Psychology

By Kaye Nemec

Grocery stores design their floor-plan and shelf layouts based on sales data, practical research and even psychology.

From the placement of flower, produce and bakery departments to the detailed way each shelf is stocked, researchers have spent years studying the psychology of grocery store design in order to maximize profits. That’s right, it’s not about making the store work the best for the shopper, it’s about making the shopper work for the store.

When you walk into your local grocery store you will, most likely, walk into fresh produce and fresh flowers and you can probably see and smell the bakery just around the next corner.

Flowers and fresh baked goods are placed close to the entrance to stimulate the shopper with the varying sights, scents and tastes. These departments have very high margins, so the store is betting you’ll spend extra time browsing, take in all of the fresh sights and scents and, hopefully, picking up a few items you didn’t intend to buy. When you are exposed to such a pleasant scene at the entrance your mind is comforted with the notion that this store has fresh items. It also activates your salivary glands which makes you more likely to purchase impulse items that are not on your list.

Staple items, or the items that consumers purchase most often, such as: bread, milk and eggs, are typically placed at the very back of the store or in the corners. If you wanted to make a quick trip to get a gallon of milk and a loaf of bread, you are forced to walk past several other aisles and sections of the store that are filled with tempting items for you to toss in your cart.

If you’ve ever taken kids to the grocery store you may have noticed how easily they’re able to grab items like sugary cereal, Mac & Cheese, cookies and other highly advertised products.

The cereal aisle is a great example of how stores stock shelves so items that appeal to kids are at their eye level.  Typically the “healthy” cereals, like granola and bran, are at the very top of the shelf. Towards the bottom you’ll find bulk items like bags of cereal and jumbo boxes. And right in the middle, at the eye level of your children, you’ll find things like Trix, Fruit Loops, Lucky Charms etc. Kids are able to grab these cereals themselves or beg their parents to add them to the cart.

They also happen to be some of the higher margin cereals. The same principle is used in most aisles, the items with the most profit are in the “Thigh to Eye” zone where customers will see them first.

Many stores also charge manufacturers a “listing fee” (aka Slotting Fee) to place a product on their shelves. If you’ve got a great idea for a product, you’ll probably have to cough up tens of thousands of dollars just to put that product on the shelf at your local supermarket. These fees are paid once for the lifetime of each SKU, but if the product is not selling well then the item will be not be carried any longer and you won’t get your listing fee back.

Placing a product on an aisle’s end cap is usually an additional fee that manufacturers pay when they want to further promote a product. Some stores also limit the number of brands in a specific category and companies may pay to be the exclusive brand in that category.

These are all ways that retailers make additional money and give the manufacturers some control over how you find their products.

Now that you know some grocery store secrets, you can avoid their traps. Always go to the store with a list and stick to it. Only buy the items you need; avoid walking down aisles that don’t relate to your list. If you bring kids with you, make sure they are aware of your list and don’t give in to their begging.

Broken Secrets

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Sources: Frugal For Life, All Sands, Listing Fees

Photo: J-P F (cc)

September 8, 2010 at 5:00 am 10 comments

Coupons You Get at Grocery Stores are Based on Your Purchases

In the United States it is very common for supermarkets to offer discounts to shoppers who present their loyalty card at the checkout. Price tags in the aisles often quote two prices, with and without the discount card.

The loyalty cards are usually provided by the retailer at no charge. However, they’re not free.

Although you don’t pay any money for these cards, you do handover your entire purchase history at that store. Your information is often used immediately at your time of purchase to determine which coupons should be printed out for your next visit.

Marketers frequently target consumers who buy their competitors products. For example, if you frequently buy Uncle Ben’s Rice, you may get a coupon from Rice-A-Roni. The manufacturer is trying to entice you to buy their brand the next time you shop.

Purchase history may also be used to determine the dollar value of the coupons you receive. For example, if you normally buy Dannon yogurt, then Yoplait may offer you $0.50 off your next Yoplait purchase. If you’re already a Yoplait customer, you may only get a $0.10 coupon or none at all.

Obviously, you don’t need a loyalty card for the store to recognize that you’re buying Uncle Ben’s today, but it is important if they want to know if you have bought that brand before or if you typically buy another brand.

When you sign up for a loyalty card, you often fill out a short survey of personal information, including your home address. They say they want your address so they can mail other offers to you, which they may. More importantly, your address allows them to understand a lot about you, including the average income of your neighborhood and even how much you paid for your house. In some cases, these programs are run by outside companies. Your address will help them combine your shopping information from multiple stores, assuming you always use the same name and address.

By comparing your personal information with information about other people’s shopping habits, average income and other demographic information, they can predict which products you’ll most likely try if they provide a coupon a for it.

Many stores will give you their loyalty card and let you use it right away, then they send you home with a survey to fill out and mail in to register for the card. I can tell you from experience that you can use your loyalty card for years without ever mailing the survey in. Although they’re collecting your shopping history, they don’t know much else about you.

There are also studies that show stores with loyalty cards don’t always have the best price, even when you use your frequent shopper card. In fact, one study even showed that sale prices went up after the introduction of a loyalty shopping card. It’s a good idea to keep track of the prices of a few items you commonly purchase to see if the regular price is better at other nearby stores.

I usually shop at a co-op, which does not use a loyalty card but has better prices than any other store around. They even have better prices than Target on items that they both carry, although that is one of the few places I cannot use my credit card to get cash back — they only accept cash or debit, one way they try to keep their costs down.

It’s not just grocery stores that provide you with sponsored coupons. I stopped at target yesterday to pick up some envelopes, on my way to the cash I spotted a new iced coffee drink. From other posts, you know I am addicted to coffee, so I couldn’t resist. At the register I was given a $7 off coupon for Crest Whitening strips. I doubt the envelopes triggered that.

Broken Secrets | By: Chad Upton

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Sources: Seattle Press, No Cards, an Industry Insider

June 22, 2010 at 8:16 am 3 comments

The Meaning of the Numbers Inside the Recycling Symbol

By: Chad Upton | Editor

I remember going to the grocery store as a small child. It seemed like we were there for hours before finally packing all of our purchases into large brown paper bags. A few years later they phased out paper bags over concern for the trees required to make the bags.  They were replaced with plastic bags and we have used them almost ever since. But, A few years ago, paper bags started appearing once again. Although they’re made from trees, those are pretty easy to grow compared to the raw materials of plastic.

It seems like everything is made from plastic now. I did a bit of dumpster diving tonight to find out how much. I went through my recycling bin looking for things with the recycling symbol on them — I guess that probably doesn’t really count as “dumpster diving.” These numbers only appear inside the recycling symbol on plastic products.

Plastic is a petroleum product, meaning the raw material used to create plastic is oil. It’s no secret that oil is one of the most in-demand natural resources and for a variety of reasons oil prices have sharply increased over the past 10 years. It’s not just the fuel companies who are affected by the increasing price of oil, but also plastic manufacturers. Both of these groups have to pass those increased costs on to their customers, and those businesses pass it on to their customers. Somewhere down the line, that customer is you and you’ve obviously noticed at the gas pump.

But, you may not have noticed the increase on plastic prices, at least not directly. Depending on where you live, you may have noticed a big or small push for you to use (or buy) reusable grocery bags. Of course these are great for the environment, but they also save the grocery store a lot of money on plastic bags, which have become significantly more expensive in the past few years. In some places, you even have to pay extra if you want plastic bags. (more…)

February 9, 2010 at 1:22 am 7 comments

Shop at Off-Peak Hours for Time Savings

I’ve said it before, I love bananas. But there is one kind of bananas I do not like, busy grocery stores!

I went to my local supermarket yesterday to pickup a few things. Being Super Bowl Sunday, it was pretty much the worst day to go grocery shopping. Normally, I would just go another day but I needed some things for later in the day (like most other people there I’m sure).

All the cart bumping and line shoving could have been avoided if I just went early in the morning or late the night before. That’s what I usually do — try to go shopping around 8pm-9pm, that includes any stores that are open late (ex. Target). Many stores are now until 10pm and some are open 24 hours. I try to take advantage of these hours since I usually get the store to myself. It actually makes shopping peaceful and efficient. (more…)

February 8, 2010 at 12:48 am Leave a comment

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