Can product location really make a difference?

Can product location really

make a difference?

The impact of the assortment structure, attentional

scope, and consumers’ traits on the location of the

selected product

by

Gréta Gonda

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Can product location really make a difference?

The impact of the assortment structure, attentional scope, and consumers’

traits on the location of the selected product

Master Thesis, Marketing by

Gréta Gonda

Supervisors: Sebastian Sadowski, MSc. Prof. Dr. Bob M. Fennis

University of Groningen Faculty of Economics and Business

MSc Marketing Management

June 21st, 2016

Gonda Gréta

Petrus Campersingel 41A, 9713 AD Groningen Telephone: +36 70 632 2214

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ABSTRACT

Product location is one of the influential elements of choice in a shopping setting. However, the question was addressed, if product location really makes an important difference? The current study investigates, whether the product location is influenced by the assortment structure, consumers’ goals and personality traits. A field study was conducted, that revealed the effects of the structure of the assortment and attentional scope of consumers on the preferred product location. Especially, the edge preference was strengthened in case of consumers with broad attentional scope. However, consumers’ characteristics did not show an effect on the choice location.

Keywords: consumer behavior; assortment planning; assortment structure; attentional scope;

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PREFACE

I would like to thank my first supervisor, Sebastian Sadowski, for his patient guidance and the valuable feedback he has provided throughout the process of thesis writing.

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TABLE OF CONTENTS

2.1. Decision-making in a supermarket setting – the importance of product location in choice architecture ... 7

2.2. Influence of the structure of assortment on product choice ... 8

2.3. The effect of consumers’ goals on consumer behavior ... 10

2.4. Customer traits’ influence: impulse buying tendency and openness to experience ... 13

3. METHODOLOGY ... 16

3.1. Experimental design and participants ... 16

3.2. Procedure ... 16 3.3. Independent variables ... 18 3.4. Dependent variables ... 20 3.5. Control variables ... 20 4. RESULTS ... 22 4.1. Manipulation checks ... 22

4.2. Testing the hypotheses: Main and interaction effects of attentional scope and assortment structure on the location of the selected product ... 23

4.3. Testing the hypotheses about the three-way interaction: The effect of impulse buying tendency ... 24

4.4. Testing the hypotheses about the three-way interaction: The effect of openness to experience ... 24

4.5. Control variables ... 25

5. DISCUSSION ... 26

5.1. Summary and conclusion ... 26

5.2. Recommendations and limitations ... 28

6. REFERENCES ... 30

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1. INTRODUCTION

It is essential for retailers to carefully plan their assortment decisions, since those have an impact on customer experience, customer lifetime value, and the overall profit of a retailer (Mantrala et al., 2009).

Since nowadays’ assortments are becoming increasingly complex and large (Kahn et al., 2014), it is more important than ever to understand, how customers make their decisions, and what influences their choice. This could contribute to the optimal allocation of products on the selves (Mantrala, 2009), and also offer benefits for consumers by facilitating their choices, which overall leads to an increased satisfaction (Hansen, 2005).

As Bar-Hillel (2011) expressed, “location, location, location” is an important influential element in decision-making. Location of a product does not only influence the sales of a certain item, but also has an effect on the popularity of complementary ones (Shaw et al., 2000). Additionally, research has shown that the location of the product plays a role in the product choice even in online shopping, which differs from purchasing products in a traditional shopping environment (Ert and Fleischer, 2014). However, since retailers have not yet found the primary shelf position preferred by customers (Valenzuela et al., 2011), it is a burning topic for research.

Previous studies have already found that assortment structure influences the preferred location (Bar-Hillel et al., 2015; Christenfeld, 1995; Ert and Fleischer, 2014; Rozin et al., 2011). Even though, results concerning the “ideal shelf position” are seemingly inconsistent to date (Bar-Hillel et al., 2015).

Furthermore, deep understanding of shopper behavior is required to influence customers’ in-store decisions (Shankar et al., 2011). Knowing more about the customers helps retailers to create a better-fitting assortment (Mantrala et al., 2009). In the shopping setting, besides personality traits, such as impulse buying tendency and openness to experience, various consumer goals may influence consumer behavior and product choice. These could also impact the location of the selected product, since they influence decision-making through different psychological principles (Gable and Harmon-Jones, 2011).

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scope and the location of the selected product in frame of the same research. If such relationship exists, findings can be beneficial for online, virtual and brick-and-mortar retailers in their assortment planning and it can make a contribution to the marketing strategy. For instance, the increasingly expanding virtual grocery stores can be more strategically planned based on various consumers’ goals and characteristics and make use of the targeted location-based mobile marketing messages.

Therefore, the goal of this study is to present research about the possible interaction between attentional scope, assortment structure and the preferred product location. It is hypothesized that the structure of the assortment may moderate the impact of the attentional scope on the location of the selected product, and this effect is strengthened by special consumers’ traits, such as impulse buying tendency and openness to experience.

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2. THEORETICAL FRAMEWORK

The theoretical background consists of four pillars. Firstly, the importance of product location in consumers’ choice architecture is examined. Then, the influence of the assortment structure and consumers’ goals on consumer behavior is discussed, and their effect on the selected product location is hypothesized. Additionally, the possible impact of consumers’ traits, such as impulse buying tendency and openness to experience, are investigated.

2.1. Decision-making in a supermarket setting – the importance of product location in choice architecture

As previous research has proved, consumers prefer retailers with a large variety of products over those that offer fewer options to choose from (Chernev, 2003a). Choice overload provides a variety of benefits, such as reduced cost of searching, easier comparison of products (Scheibehenne et al., 2009) and more personal freedom (Schwartz, 2004). Since there is a higher chance to match to expectations of various segments, retailers may attempt to facilitate consumers’ decisions by offering a large variety of products to choose from.

However, choice overload has also downsides, such as more difficult decision-making, preference uncertainty or frustration, which may lead to regret and dissatisfaction with the chosen product, or no choice at all (Chernev, 2003b; Iyengar and Lepper, 2000; Schwartz et al., 2002). Therefore, it is important for retailers to develop consumers’ decision-making competence and investigate what influences choices (Hansen, 2005).

When consumers purchase a relatively unimportant product, they tend to minimize cognitive efforts and make a “satisfactory” choice (Hoyer, 1984). According to Schwartz et al. (2002), “satisficers” evaluate products until they find an option that is “good enough”. As the environment is getting more complex, consumer decision making is getting more complicated, and involves many perspectives (Kahn et al., 2014). Therefore, low-involved consumers may use heuristics, simple decision rules to choose a product (Hansen, 2005).

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Moreover, the location of the products influences sales of the items, and additionally the sales of complementary products (Shaw et al., 2000).

Retailers’ aim is to increase sales and influence the choice of costumers, consequently, they need to plan the organization of the assortment and choose the location of the products carefully (Chung et al., 2007). Thereby the negative consequences of the decision conflict generated by the too-much-choice-effect can be eliminated, for instance by changing variety perceptions (Hoch et al., 1999; Kahn and Wansink, 2004; Scheibehenne et al., 2009). Therefore, the current research will investigate how the location of the everyday purchased products is influenced by the organization of the assortment, consumers’ goals and characteristics.

2.2. Influence of the structure of assortment on product choice

Research shows that assortment structure can impact which products consumers select from the shelf. For instance, Drèze et al. (1995) demonstrated that the sales of toothbrushes increased by 8% after the items were moved from the top shelf to shelves at the eye level. Another study (Inman et al., 1990) showed an increase in sales for products in the end-of-aisle display, because of consumers’ belief that these products were on discount, regardless of that was true or not.

In general, retailers believe that vertically top level, more precisely eye or hand level is the best shelf position (Drèze et al., 1995; Herpen et al., 2012), whereas horizontally the middle (Chung et al., 2007). However, according to marketing theory, no most popular, “ideal” horizontal position has been discovered yet, research suggests that there are different locations, from where customers most often choose products from the shelf. For example, in the study of Chung et al. (2007), in the case of the same dairy products items with central positions were preferred in convenience stores, while in supermarkets products in the edge were favored. According to Bar-Hillel’s comprehensive research (2015) on position effects in choices from simultaneous displays, such as assortments, results are seemingly inconsistent to date.

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As prior studies have proved, in case of evidently equivalent assortments, items that are positioned in the center are picked more often, than those that are located at the extremes (Christenfeld, 1995; Shaw et al., 2000). Since the choice (or “picking an item”) requires no processing, the equivalence of the items is automatically realized (Bar-Hillel, 2015). Additionally, research shows that people look first at the middle items of the assortment, which are in the central position of the perceptual field (Atalay et al., 2012). The items in horizontal central location get an increased visual attention, and ultimately are more likely to be chosen than items on the edge (Atalay et al., 2012; Shaw et al., 2000).

Furthermore, the choice is affected by the urge of minimizing mental (Christenfeld, 1995) and physical efforts (Bar-Hillel et al., 2014). Minimizing mental efforts reflects on that picking a central product requires less concentration, than striving for the extreme (Christenfeld, 1995). Moreover, reducing physical efforts refers to the principle of reachability, in other words, the preference of the object which can be reached comfortably, and that is located the closest, compared to the items that are further away from the person (Bar-Hillel et al., 2014). Therefore, when people choose from evidently equivalent assortments, a preference for items with central positions can be observed (Christenfeld, 1995). However, in special cases, when the assortment is designed in such a way, that the middle items are not the most reachable (e.g. because of inconvenient reachability due to an obstacle), the central options are not preferred (Drèze et al., 1995).

For the preference of the middle position from equivalent items, an alternative explanation is the center-stage heuristic (Rodway et al., 2016), which means that consumers believe that the most popular and best options are placed by retailers in the central shelf-positions (Valenzuela and Raghubir, 2009). Even if this shared belief is not true (Valenzuela et al., 2013), it influences consumers’ choice, so that they pick the products that are placed on the middle shelves (Valenzuela and Raghubir, 2009). The reason for this effect is that when consumers cannot discriminate or differentiate between the items of the assortment, they use a simple principle to choose a product from the shelf (Valenzuela and Raghubir, 2009).

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Even if there is no correlation between the real attributes of a product and its location, the position effects can influence the choice (Ert and Fleischer, 2014). According to previous research, from non-equivalent items people choose more often from the edge of the assortment (Bar-Hillel, 2015; Dayan and Bar-Hillel, 2011; Ert and Fleischer, 2014; Rozin et al., 2011). The edge advantage can be explained by different psychological principles (Bar-Hillel, 2015). When the choice requires motor action, the preferred location can be influenced by physical reachability (Bar-Hillel, 2015). Rozin et al. (2011) found that choice from a salad bar was influenced by the accessibility of the preferred option. If the favorite salad was hard to reach in the middle, people ended up taking a less preferred salad from the edge, thus the more accessible salad items found in the edge were preferred to the middle options.

Another explanation for edge preference is the primacy-recency effect, especially among non-equivalent items that are presented vertically, such as menu items and list of hotels for online booking (Bar-Hillel, 2015; Ert and Fleischer, 2014). Primacy effect refers to the choice of the first option that is satisfying or “good enough”, whereas recency effect reflects to the finding, that after scanning through the items, choice from the last options has a relative advantage (Ert and Fleischer, 2014).

Since the above mentioned theory was confirmed in case of vertically presented items (Bar-Hillel, 2015; Ert and Fleischer, 2014), in the current study the following hypothesis will be tested among items that are presented in an assortment structure, such as products on the shelf:

Hypothesis 1: The structure of the assortment influences the location of the selected product in

such a way that there is a center preference in case of evidently equivalent assortments, whereas there is an edge preference in case of non-equivalent assortments.

2.3. The effect of consumers’ goals on consumer behavior

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(Hoyer, 1984). Therefore, a clear difference can be observed between shopping with an active goal, and being ‘on the fly’.

For understanding this phenomenon, it is important to examine how attentional scope is affected by emotion and explore the effects of the underlying dimensions of emotions, which are the affective valence and the motivational dimension. Affective valence is the evaluation of an individual’s experienced state, a negative-to-positive feeling, such as displeasure or pleasure, whereas motivational direction is the action tendency accompanied by the affective condition. Motivational direction can refer to moving towards (approach motivation), or moving away from an object (avoidance motivation) (Gable and Harmon-Jones, 2008). In the supermarket setting, when customers have a salient goal in mind, there is a strong desire or action tendency to move toward the goal, therefore one can talk about positive approach motivation.

As previous literature suggested, positive affect broadens, while negative affect narrows the scope of attention (Friedman and Förster, 2010; Isen, 2002). However, further research suggests that the same affective valence can impact attention and cognition differently (Bodenhausen et al., 1994). According to Harmon-Jones et al. (2011) the variation in attentional tuning is caused by motivational intensity, rather than the affective valence.

Positive affect varies in approach motivational intensity, in such a way that some positive affects, like enthusiasm or desire for a product in the supermarket, are high in approach motivational intensity, while others, such as satisfaction or joy felt due to accomplishing a goal, are low (Gable and Harmon-Jones, 2008). As previous literature has proved, the impact of positive affect on attention can vary, which consequently results in differences in decision-making (Bodenhausen et al., 1994; Gable and Harmon-Jones, 2011; Isen, 2002). Gable and Harmon-Jones (2008) found out, that high-approach-motivated positive affect reduces the breadth of attention, whereas low-approach-motivated positive stimulus broadens the global attentional focus.

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and focus on those cues that assist in acquiring the goal (Fujita and Trope, 2014; Gable and Harmon-Jones, 2013). Therefore, in the shopping setting, consumers with narrowed attention may ignore goal-irrelevant stimuli and distractors in contrast to people with broad attention (Fujita and Trope, 2014; Gable and Harmon-Jones, 2011).

On the other hand, positive affects low in approach-motivation occur after a desired goal is accomplished (post-goal). Post-goal positive states may expand the cognitive scope (“unstructured regulation” in Fujita and Trope, 2014), since the attentional focus is no longer required for realizing the goal (Fujita and Trope, 2014; Gable et al., 2016). As a result, these consumers with a broad attentional scope may have a higher level of openness to distractions and goal-irrelevant stimuli. Additionally, they may be sensitive to alternative and unplanned purchases (Fujita and Trope, 2014; Gable and Harmon-Jones, 2011; Harmon-Jones et al., 2011). In line with the above, attention can be compared to the zoom lens of a camera, because of its changing spatial scope (Rowe et al., 2007). People with broad attentional scope perceive global targets, with several options to choose from, including items from the edge of the assortment. In contrast to people with narrow attentional scope, who distinguish local targets and focus on the “trees” instead of the “forest” (Friedman and Förster, 2010), making people with narrow attentional scope more likely to choose a product from the center of the assortment. Therefore one can expect the following hypothesis:

Hypothesis 2: People with broad attentional scope choose products from the edge of the

assortment, whereas people with narrow attentional scope choose products that are located closer to the center.

A further proof for different attentional tuning in pre- versus post-goal affective states (i.e. in narrow vs. broad attentional scope condition) is that memory is affected differently for centrally versus peripherally presented information (Gable and Harmon-Jones, 2010).

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building on previous literature, is believed to indicate consumers’ preferred product location in such a way, that people with broad attentional scope choose items that are located in the edge of a non-equivalent assortment (Bar-Hillel, 2015; Dayan and Bar-Hillel, 2011; Ert and Fleischer, 2014; Rozin et al., 2011), whereas they are likely to select items from the center of an equivalent assortment (Christenfeld, 1995; Shaw et al., 2000).

In contrast, people with narrow attentional scope recognize central items easier, because they focus predominantly on the salient goal (Gable et al., 2016). Since people in positive pre-goal states tend to minimize their mental efforts that are not connected to their goals (Gable and Harmon-Jones, 2010), they are not responsive to cues of the environment, and do not take unnecessary information into account when choosing a product (Christenfeld, 1995). Because of the cognitive narrowing, it is not likely that the assortment structure influences their choice (Gable and Harmon-Jones, 2011). Consequently, it is not likely that they choose alternative products and different options except for their initial preference from a non-equivalent assortment, while most probably they pick the most reachable, central product from equivalent items (Bar-Hillel et al., 2014; Christenfeld, 1995). This indicates a constant center preference, even in case of a choice from a non-equivalent assortment.

Based on the previous argumentation, the following hypothesis will be tested:

Hypothesis 3: The impact of the attentional scope on the location of the selected product is

moderated by the structure of the assortment, so that choice of people with broad attentional scope shows an edge preference from a non-equivalent assortment and a center preference from an equivalent assortment, whereas the assortment structure has no effect on choice of people with narrow attentional scope, who choose products that are located closer to the center from both assortments.

2.4. Customer traits’ influence: impulse buying tendency and openness to experience

According to Bell et all. (2011), retailers could profit from knowing the customer more, and understanding consumers’ choice drivers better, since even customers with a salient goal in mind may be affected by in-store marketing stimuli and visual factors in the supermarket.

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Generally, impulsive customers enjoy browsing the shelves (Beatty and Ferrel, 1998), and they are more responsive to environmental cues (Dijksterhuis et al., 2005), such as differences in the structure of the assortment.

Consumers with a high level of impulsiveness are also more open to alternative purchases and unexpected shopping ideas, when they are exposed to in-store marketing stimuli (Bell et al., 2011; Rook and Fisher, 1995). Based on the following argumentation, this characteristic can have an effect on choices of customers with broad attentional scope, who are ‘on the fly’ and consider purchasing products from the periphery of the non-equivalent assortment (Gable and Harmon-Jones, 2011).

In contrast to people with low impulsiveness, whose decisions are often efficient and fast, people who tend to make unintended purchases are more distractible (Amos et al., 2014), due to the low level of control for the surrounding cues of the environment (Vohs and Faber, 2007). These customers do not only react more to marketing stimuli, but they are also more variety seeking (Sharma et al., 2010). Furthermore, they process information in such a way, that the environmental cues’ unconscious effects have an impact on their decision-making (Dijksterhuis et al., 2005), therefore they are sensitive to the contextual cues to a larger extent, which results in being more responsive to the assortment structure.

Impulsivity is expected to affect the edge preference of customers with broad attentional scope from a non-equivalent assortment, so that these customers may choose products from the edge to a larger extent from a non-equivalent assortment.

Hypothesis 4: Impulse buying tendency influences the moderation effect of the assortment

structure so that high impulsiveness strengthens the edge preference of people with broad attentional scope from a non-equivalent assortment, whereas it has no effect on the location of the selected product of people with narrow attentional scope.

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Openness to experience is one of the dimensions of the “Big Five” personality traits, and it can be described as having broad interests, flexible thoughts and being open to alternative ideas (Digman, 1990; McCrae and Costa, 1987). Consumers with a high level of openness to experience are more creative, imaginative, open-minded, and show a higher level of curiosity (Costa and McCrae, 1985; John and Srivastava, 1999). Therefore, these customers are more sensitive to the in-store contextual cues. When more open customers are ‘on the fly’ and browse the assortment, they tend to consider more options, seek more alternatives and new products. This indicated that the assortment structure may influence the attentional scope, since consumers with broad attentional scope and high openness are variety seeking and analytical to a large extent (McCrae and Costa, 1987). They process information from a non-equivalent assortment in a different way; they analyze the different items of the assortment one by one. Therefore, these customers may choose products to a greater extent from the edge of the non-equivalent assortment due to their openness.

Thus, the following hypothesis will be tested (see: Figure 1):

Hypothesis 5: Openness to experience influences the moderation effect of the assortment

structure so that high openness to experience strengthens the edge preference of people with broad attentional scope from a non-equivalent assortment, whereas it has no effect on the location of the selected product of people with narrow attentional scope from both assortments.

Figure 1: Conceptual model

H4

H1 H2

H3

Attentional scope Location of the selected product

Structure of the assortment Impulse buying tendency

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3. METHODOLOGY

An empirical research was conducted to test the conceptual model and the hypotheses. This chapter explains how the research was performed and the data was analyzed. Firstly, the description of the dataset and the design of the experiment are outlined. Then, the procedure and the operationalization of variables are described.

3.1. Experimental design and participants

The study used a 2 (narrow vs. broad attentional scope) x 2 (evidently equivalent vs. non-equivalent structure of the assortment) between-subject factorial design. A field setting was chosen based on the advantages of a “real” shopping context, which induces different feelings, attitudes and behavior of individuals (Aronson et al., 1998).

In total, one hundred Dutch and international (Table 1A, Appendix) adults (40 female, 60 male; Mage = 26,88, SDage = 11,18) took part voluntarily in the field research. In order to satisfy the

normality and independence assumptions, ten responses were excluded from the final analysis due to outliers in demographics and excessive number of missing responses. The final data set consisted of 92 participants, of which 46-46 subjects had narrow and broad attentional scope.

Table 1: The design of the study

structure of the assortment evidently

equivalent non-equivalent attentional

scope

Narrow Condition I Condition II

Broad Condition III Condition IV

3.2. Procedure

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attentional scope condition were approached after they finished their meals, while they were leaving their tables.

On one hand, it was assumed that approaching people, who enter Burger King, would ensure that they have a salient goal ahead of them, such as eating a meal, or meeting someone (Gable and Harmon-Jones, 2011). Therefore, these respondents were assigned to the narrow attentional scope condition. Moreover, since hunger is a drive-relevant stimulus (Mogg et al., 1998), higher level of focus on the goal and narrow attentional scope are assumed to derive from it, therefore, their level of hunger were expected to have been on average higher, than those of in the broad attentional scope condition. Hunger was measured by self-reporting, using a scale from 1 (not hungry at all) to 9 (extremely hungry).

On the other hand, participants, who were addressed after finishing their meals in Burger King, were assumed to have post-goal positive states, since they had just managed to attain their goal (Gable and Harmon-Jones, 2011). Thus, these participants were assigned to the broad attentional scope condition. Furthermore, leaving people should not have another urgent goal in mind, therefore these participants were addressed the question, whether they were in a hurry, and if the response was positive, they were excluded from the research. However, these responses were already preliminarily excluded from analysis due to missing answers, as these people were in a hurry and they did not pay proper attention to the questions.

The study ran for one week, between Monday and Friday. Each participant was allocated to the equivalent and non-equivalent assortment structure conditions. Overall twenty five responses were collected for each of the four conditions. Only participants with higher level of English proficiency were selected to take part in the study.

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they would pick in the supermarket. The two assortments were shown to every second participant in a different order in case of each condition, because careful attention was given to controlling the order-effect bias. After completing the choice task, participants were requested to fill in a questionnaire, which consisted of two parts. In the first part, questions were asked in connection with the choice task, which assessed choice difficulty, perceived variety and perceived equivalence of each assortment. In the final part of the survey, respondents answered questions about impulse buying tendency, openness to experience and they were asked to state their mood, age, gender and nationality.

3.3. Independent variables

Attentional scope. The variable attentional scope was not manipulated. As attentional scope can

be induced from goal pursuit (anticipating or attaining a particular goal), participants were classified as either having broad or narrow attentional scope, based on their action of entering or leaving Burger King (Gable and Harmon-Jones, 2011).

Moreover, response time was measured during the product selection task. In broad attentional scope condition the choice was believed to take longer because of being more responsive to environmental cues and the assortment structure, compared to the narrow attentional scope condition. In the latter condition, cognitive narrowing was believed to be dominant, resulting in shorter response time (Gable and Harmon-Jones, 2011).

Structure of the assortment. The variable was manipulated by showing participants an equivalent

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In order to analyze, whether or not the non-equivalent assortment was perceived to be different, than the equivalent one, equivalence was measured by self-reporting the perceived level of equivalence on a nine-point Likert scale. Additionally, it is assumed, that, when choice requires deliberation, the choice is more difficult, thus on average choice difficulty in case of a non-equivalent assortment should be higher than in case of the non-equivalent one. Choice difficulty was measured by answering “How difficult was it for you to decide which option to choose?” and “How complex did you find it to make your decision?” on a nine-point Likert scale, taken from Griffin and Broniarczyk (2010). Reliability analysis on the four items measuring perceived variety of evidently equivalent and non-equivalent items showed that Cronbach’s α = .83 and α = .88 respectively.

Also, response time in the selection tasks were measured, and compared for both assortments. The time taken for the choice was believed to be higher in case of non-equivalent assortment, because the deliberation of the products takes more time. This could indicate the differences in the perceived equivalence of the assortments.

Impulse buying tendency. In order to measure the natural buying impulsiveness, the Rook and

Fisher (1995) scale was used. Participants were asked to rate statements about their shopping behavior on a nine-point Likert scale, ranging from “strongly disagree” to “strongly agree”. One of the statements is phrased in a reversed way, so this item was recoded before analysis. The scale is composed of nine items (Exhibit 5A, Appendix), and Cronbach’s α showed a good internal reliability, α = .92.

Openness to experience. Openness to experience is a part of the Big Five personality traits. The

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3.4. Dependent variables

Location of the selected product. In the choice task, participants could choose a product from 99

different locations from each assortment. Therefore, each location received a number from 1 to 99 (i.e. the item in the first row of the first column got a ‘1’, the item in the second row of the first column got ‘2’, etc.), and the number of the selected product from both assortments was noted down. The locations were recoded for the analysis, based on their Euclidean distance from the central item of the assortment, so that the central item got ‘1’ is and the items in the edge got ‘10’.

Perceived variety. After completing the choice task, participants were asked questions and were

asked to rate a statement about how they perceived the variety of each assortment. Since perceived variety does not always reflect to actual variety (Kahn and Wansink, 2004), it was measured in order to assess, whether participants faced a choice overload and had enough variety of products to choose from. The scale was taken from Kahn and Wansink (2004) and it consists of four items. Participants answered three questions on a nine-point Likert scale, ranging from “strongly disagree” to “strongly agree”, and rated one statement about the perceived variety of the assortment from “very little variety” to “very much variety” (Exhibit 4A, Appendix). The scale was found to be reliable in case of evidently equivalent and non-equivalent assortments, Cronbach’s α was respectively .73 and .81.

3.5. Control variables

In the final part of the survey, questions were asked about demographics and mood of participants (Exhibit 7A, Appendix). These items represented the control variables, which were measured in order to ensure that the variables in the conceptual model were measured accurately, and find out whether other variables account for a significant difference in the dependent variables.

Gender. Self-reported data was collected about gender.

Mood. Participants rated their mood on a six-item-scale, which was adapted from Aarts and

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4. RESULTS

Firstly, the results of the manipulation checks are presented. Secondly, the hypotheses are tested. The main and interaction effects of the assortment structure and attentional scope were tested by a two-way ANOVA, using location of a selected product as a dependent variable. Then, a three-way ANOVA was run twice to test the effects of openness to experience and impulse buying tendency, using location of a selected product, as dependent variable. Finally, it was tested, whether the control variables had an effect on the location of the selected product.

4.1. Manipulation checks

In order to analyze, whether an initial condition of choice overload was fulfilled in case of both assortments, a paired samples t-test was run. The perceived variety of the assortments did not differ significantly, t(87) = .062, p = .951, ns. Furthermore, the means indicate that high variety was perceived in both assortment (M non-equivalent assortment = 6.37, SD non-equivalent assortment =

1.94, M equivalent assortment = 6.30, SD equivalent assortment = 1.65).

To find out, whether participants perceived the equivalent assortment differently compared to the non-equivalent one, a paired samples t-test was run with choice difficulty. The paired samples t-test was significant, t(90) = 2.577, p = .012. The choice difficulty from the non-equivalent assortment was significantly higher (M = 5.12, SD = 2.25) than the choice difficulty from the equivalent assortment (M = 4.23, SD = 2.86), therefore the (non-)equivalence of the assortments was manipulated successfully.

Furthermore, self-reported equivalence of both assortments was compared, using a paired samples t-test, which was not significant, t(92) = .308, p = .759, ns. This result was probably the consequence of not understanding this particular question, since the majority of the participants pointed out, that they were not aware of the meaning of this item in the questionnaire.

Also, a paired samples t-test was run in order to test whether the response time in the choice task was significantly higher for the non-equivalent assortment, than the time taken for choosing a product from the equivalent assortment. The test was significant, t(92) = 6.224, p = .000, the mean response time was significantly higher for the choice from non-equivalent assortment (M

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The successful manipulation of attentional scope was tested by measuring the effects of hunger and response time taken for the selection task. Effect of hunger was measured by a one-way ANOVA. Level of hunger was significantly higher (F (1, 91) = 83.609, p = .000) in the narrow attentional scope condition compared to the broad attentional scope condition: M broad attentional scope = 2.91, SD broad attentional scope = 2.46, M narrow attentional scope = 6.80, SD narrow attentional scope =

1.50.

A one-way ANOVA was run to compare the overall response time taken for the selection tasks in broad versus narrow attentional scope conditions. No significant difference was found between the response times in the two conditions, (F (1, 92) = .671, p = .415, ns), which indicates that participants spent approximately the same time on completing the section tasks in both conditions.

4.2. Testing the hypotheses: Main and interaction effects of attentional scope and assortment structure on the location of the selected product

As hypothesis 1 predicted, the statistical model revealed a significant main effect of the assortment structure on the location of the selected product (F (1, 90) = 5.577, p = .020). Participants in the equivalent assortment condition chose products that were located closer to the center (M = 4.37, SD = 2.11), whereas participants’ choice from the non-equivalent assortment were closer to the edge (M = 5.02, SD = 2.39).

The main effect of attentional scope on the location of the selected product was marginally significant (F (1, 90) = 3.487, p = .065). In line with hypothesis 2, participants in the narrow attentional scope condition chose products to a greater extent from the center (M = 4.28, SD = 2.13), compared to participants in the broad attentional scope condition, whose choice were closer to the edge (M = 5.1, SD = 2.32).

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Figure 2: Two-way interaction: The mean distance from the center in the choice task

4.3. Testing the hypotheses about the three-way interaction: The effect of impulse buying tendency

An ANOVA was performed to test the interaction between impulse buying tendency and the moderation effect of the assortment structure on the impact of attentional scope on the selected product location. This interaction was not significant (F (1, 85) = .178, p = .675, ns), which indicates that impulsiveness did not affect the location of the selected product from the assortment.

4.4. Testing the hypotheses about the three-way interaction: The effect of openness to experience

Hypothesis 5 predicted an interaction between openness to experience and the moderation effect on the selected product location. However, contradicting the expectation, the analysis showed that the interaction was not significant (F (1, 87) = 1.104, p = .296, ns), indicating that the location of the selected product varied regardless the level of openness to experience of participants.

evidently equivalent non-equivalent

M ea n dis ta nce fro m t he ce nt er Assortment structure Attentional scope

25

4.5. Control variables

26

5. DISCUSSION

5.1. Summary and conclusion

The aim of this study was to reveal the effect of assortment structure (equivalent vs. non-equivalent) and attentional scope (broad vs. narrow attentional scope) on the location of the selected product. The location (center vs. edge) was measured by the position of the chosen item from a planogram, presented to customers. Additionally, personality traits’ effects on the choice of location were investigated. Impulsiveness and openness to experience were measured by using scales (Costa and McCrae, 1992; Rook and Fisher, 1995).

The research found support for hypothesis 1, that the assortment structure influences the product choice location. The study proved that people choose the central products when they are faced an evidently equivalent assortment, while their choice lay closer to the edge from a non-equivalent assortment. These results are in accordance with previous research of Rozin et al. (2011) and Christenfeld (1995). Moreover, current study provides further support for the results of the comprehensive research of Bar-Hillel (2015), who pointed out that there is an edge preference from non-equivalent items that are presented vertically, as a list (Bar-Hillel, 2015; Ert and Fleischer, 2014). In current study, the same results were revealed in case of a 9 x 11 large horizontally displayed assortment.

Also, the location of the selected product was influenced by the attentional scope. In line with earlier research, people with narrow attentional scope chose products from the center of the assortment, while people with broad attentional scope showed an edge-preference (hypothesis 2). This finding further supports the claim, that people, who are shopping with a particular goal in mind are not influenced by cues that does not assist in acquiring their goal, whereas people with broad attentional scope are more responsive to environmental cues (Gable and Harmon-Jones, 2013).

27

showed a clear center preference. This indicates that people who are ‘on the fly’ are even more responsive to the environmental stimuli, such as the structure of the assortment (Fujita and Trope, 2014; Gable and Harmon-Jones, 2011).

Moreover, the results show that the level of impulsiveness and openness to experience does not affect the location of the selected product (hypothesis 4 and 5). Even if personality traits influence the perceptions of the environment (Dijksterhuis et al., 2005; Grossbart et al., 1975), and have an impact on the level of responsiveness to environmental cues, these do not affect specifically the location of the selected product.

There are also a number of possible implications of the results. Current research succeeded to offer new insights of consumers’ decision-making for retailers.

Marketing strategy and assortment planning can be more sophisticated based on consumers’ goals. People who are ‘on the fly’ are more responsive to marketing stimuli; they consider a greater number of products, different categories and spend more time on browsing the assortment compared to people who are shopping with a specific goal in mind. Current results suggest retailers to take into consideration consumers’ goals as well, when they make decisions about assortment planning. When a retailer aims to influence the sales of a specific product, it may be beneficial to place those items to the center, when also people with narrow attentional scope are more likely to pick them (e.g. chewing gum). Although, in case of a non-equivalent assortment, placing products to the edge of the shelves can have positive effects on sales, especially when it targets people who are ‘on the fly’.

There is another implication, for the relatively new innovation, the virtual grocery store, which is located in the subways already in a few countries. Consumers possibly browse the assortments in the later hours of a workday, when they are on their way home, whereas it is likely that in earlier hours, before work, they mostly shop with a salient goal. Retailers could consider the differences between the two conditions, when deciding about marketing strategy and assortment planning, so that they can send targeted location-based mobile marketing messages when consumers are more reactive to marketing stimuli.

28

product location can be changed accordingly to whether customers are looking for a particular product or just browsing in the web shop. When customers have a salient search goal, the assortment could be presented in such a way that the suggested products for purchase are in the center of the search results, while when consumers are browsing in the product category, the retailer could place suggested items in the edge.

5.2. Recommendations and limitations

One of the limitations of the study is that attentional scope measurement was purely based on the observation of the action of entering Burger King or leaving the fast food restaurant. It might be the case that for some participants, eating in Burger King was not such a salient goal, which resulted in clear difference in the attentional scope. Also, this might be confirmed by the fact that consumers’ response time was approximately the same in the broad and narrow attentional scope conditions. However, hunger was also measured and found to be higher on average in case of the participants in the narrow attentional scope condition, which suggests that these participants were focused on their goal.

Furthermore, some of the drawbacks of field experiment are that a larger experimental control is missing. In the lab setting, those consumers who hate donuts or sweetened bread spreads could be easily excluded from the research, while in the field study it was not feasible. These participants probably chose products that were the most salient for them, even if this effect was supposed to be eliminated by choosing the items of the assortment properly.

Also, in a few cases, choices of participants were influenced by the fact that they knew one of the items of the assortment by chance. Similarly, even if the locations of the items of the assortment were randomized, it might be the case that participants only found the preferred product in one location (center or edge), which influenced their choice.

Moreover, in the entrance of Burger King, many people were crossing by, therefore, it might be the case that participants could not pay proper attention to all the answers given or they were influenced by social pressure.

29

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7. APPENDIX

Exhibit 1A: Introduction of the study

Dear Participant,

thank you for taking part in my survey. Please read and sign the following statement:

I voluntarily agree to participate in this study. I reserve the right to withdraw my consent without reason and realize that I may at any time stop the experiment. If my results will be used in scientific publications, or otherwise disclosed, this will occur completely anonymously. My personal data will not be seen by others without my permission.

If I require further information about this research either now or in the future, I can contact: Gréta Gonda at gondagreti@gmail.com.

_______________________

The questionnaire is related to consumer choices and buying behaviour. Filling in the survey will only take you around 7 minutes. Thank you.

Gréta Gonda

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37

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Exhibit 4A: Perceived variety scale (Kahn and Wansink, 2004)

Please indicate (X) how much you agree or disagree with the following statements about your choice:

This assortment of bread spreads gives

me a lot of variety for me to enjoy. 1 2 3 4 5 6 7 8 9 This assortment of bread spreads gives

me at least one flavor I like. 1 2 3 4 5 6 7 8 9 This assortment of bread spreads offers

more ways to enjoy it. 1 2 3 4 5 6 7 8 9

How much variety do you think there is in this assortment?

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Exhibit 5A: Impulse buying tendency scale (Rook and Fisher, 1995)

Please indicate (X) how much you agree or disagree with the following statements about your shopping behaviour.

Strongly _disagree Disagree Moderately disagree Mildly disagree Un-decided Mildly agree Mode-rately agree Agree Strongly agree I often buy things spontaneously. 1 2 3 4 5 6 7 8 9 "Just do it" describes the way I buy things. 1 2 3 4 5 6 7 8 9 I often buy things without thinking. 1 2 3 4 5 6 7 8 9

40

Exhibit 6A: Openness to experience scale (Costa and McCrae, 1992)

How I am in general – Here are a number of characteristics that may or may not apply to you.

For example, do you agree that you are someone who likes to spend time with others? Please mark the blank (X) next to each statement to indicate the extent to which you agree or disagree with that statement.

41

Exhibit 7A: Final questionnaire What is your age?

What is your gender?

Male Female

What is your nationality?

How would you rate your ability to speak English?

Poor – Fair – Good – Very good – Excellent – Native speaker

Please mark (X) the blank that best indicates how you feel at the moment.

How hungry are you?

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Table 1A: Description of participants

Table 2A: Interaction effect descriptive statistics

Attentional scope Assortment structure Mean SD Narrow attentional scope equivalent 4,15 1,966 non-equivalent 4,41 2,305 Total 4,28 2,135 Broad attentional scope equivalent 4,57 2,243 non-equivalent 5,62 2,308 Total 5,10 2,324 Total equivalent 4,43 2,178 non-equivalent 5,02 2,373 Total 4,74 2,305 Nationality of participants Percent

From the Netherlands 71 From other European countries 12

American 3

Asian 13

African 1

Can product location really make a

difference?

The impact of the assortment structure, attentional scope, and

consumers’ traits on the location of the selected product

University of Groningen

MSc Marketing Management

1/7/2016 | 2

Introduction

•

Retailers’ assortment planning – impact on profit, CLV, customer experience

 Understand how consumers’ make decisions – location influences choice

•

Choice overload: too-much-choice-effect

 Position on the shelf can influence product choice

•

Previous research: „ideal shelf position” is inconsistent to date

„Location, location, location”

1/7/2016 | 3

Research question

How the location of the selected product is influenced by the assortment structure,

consumers’ goals and personality traits?

•

Attentional scope:

shopping with a salient goal (narrow) vs. being ‘on the fly’(broad)

and Harmon-Jones, 2011)

•

Assortment structure:

evidently equivalent vs. non-equivalent

•

Impulsiveness, openness to experience: responsiveness to environmental cues

Choice requires deliberation

,

primacy-recency effect

Minimizing mental and physical efforts

(Christenfeld, 1995)

,

1/7/2016 | 4

Conceptual Model (1)

Hypotheses

H1 Assortment structure influences the location

of the selected product

Evidently equivalent: Center preference

Non-equivalent: Edge preference

H2 Attentional scope influences the location of

the selected product

Broad attentional scope: Edge preference

Narrow attentional scope: Center preference

H3 The impact of the attentional scope on the

location of the selected product is moderated

by the structure of the assortment

1/7/2016 | 5

Conceptual Model (2)

Hypotheses

H4 Impulse buying tendency influences the

moderation effect of the assortment structure

Broad attentional scope – non-equivalent assortment: High

impulsiveness strengthens the edge preference

H5 Openness to experience influences the

moderation effect of the assortment structure

1/7/2016 | 6

Methodology

•

Four conditions:

•

Product location: choice from a planogram

•

Questionnaire

- Scales: Costa and McCrae (1992);

Rook and Fisher (1995)

•

Two-, and three-way ANOVA

Evidently equivalent

assortment

Non-equivalent

assortment

Narrow attentional scope

Condition I

Condition II

1/7/2016 | 8

Results

(H3) Interaction effect between

the assortment structure and the

attentional scope was significant

•

Edge-preference in broad

attentional scope condition,

from non-equivalent

assortment

•

Center-preference in broad

attentional scope condition

from evidently equivalent

assortment; in narrow

1/7/2016 | 9

Conclusion

•

Main and interaction effect between the assortment structure and the attentional

scope on the location of the selected product

•

Implications:

 Retailers’ marketing strategy and assortment planning

 Virtual grocery stores: location-based mobile marketing messages

 Online shop: search results organization according to consumers’ goals

•

Limitations:

 Drawbacks of a field experiment

 Attentional scope condition was based on

observation of entering/leaving Burger King

 Decision-making is a complex concept – it

1/7/2016 | 10

Thank you for your attention!