Kathmandu University School of Management

Factors affecting Impulsive Buying

Behavior
Paper on Consumer Behavior

Submitted to:
Mr. Rupesh Krishna Shrestha
Lecturer Consumer Behavior

Submitted by:
Kaushal Shrestha | 13522
Ranjit Kumar Karna | 13507

EMBA, Term V
September 13, 2014

Abstract
In the consumer products especially in B2C, particularly in the convenience goods categories,
customers buy frequently and think a little about it. They are of little value and have many close
substitutes of it; therefore these types of product have strong branding & eye-catching colors &
designs to make them stand-out from rest of similar categories. The consumers behave
differently with these products and for example for the impulse goods have spur-of-the-moment
purchases that have no advance planning. Customers are not usually prepared to pay too high a
price for such purchases.
In this report, we study different factors affecting Impulse buying behavior in customers.

Table of Contents
1.

Introduction..............................................................................................................................1
1.1.

Background Of study........................................................................................................1

1.2.

Statement of Issue.............................................................................................................1

1.3.

Hypothesis.........................................................................................................................2

2.

Conceptual Framework............................................................................................................2

3.

Methodology............................................................................................................................3

4.

5.

3.1.

Research Approach...........................................................................................................3

3.2.

Instrument and Validity.....................................................................................................3

3.3.

Sample and Sample Size...................................................................................................4

Data Analysis and Findings......................................................................................................4

4.1.

Research Frequencies........................................................................................................4

4.2.

Analysis.............................................................................................................................5

4.3.

Findings.............................................................................................................................6

Conclusion and Recommendations..........................................................................................7

Appendix..........................................................................................................................................8
References........................................................................................................................................9

1. Introduction

1.1. Background Of study

Impulse buying, as suggested by (Rook D. , 1987) occurs, when a consumer
experiences a sudden, often persistent urge to buy something immediately. The impulse
to buy is hedonically complex and may stimulate emotional conflict. Also, impulse
buying is prone to occur with diminished regard for its consequences. Majority of the
purchases are found to be made on impulse. (D.Bellenger, Robertson, & E.Hirschamn,
1978) observed that in the US 38.7% of department store purchases were made
impulsively and between 30% to 50% of all purchases we made by buyers themselves
classified as impulse buying. Impulsive buying therefore, has been considered an
important feature in consumer behavior.
1.1.1. Elements driving Impulse buying

Mood of customer
Price
In store environment
Credit availability
Attractiveness of a
product

Culture
Brand name
Advertisement
Quality
Variety
Fashion and trends

Varying impulse buying behavior was shown not only by different shoppers

purchasing over the same item but also by the same shopper purchasing the same item
under different circumstances such as time, location. This resulted Stern (1962) to
categorize the impulsive purchase into a mix of different kinds of impulse buying like;
a) Pure impulse buying: It is a novelty or escape purchase which breaks a normal
buying pattern.
b) Reminder impulse buying: Occurs when a shopper sees an item or recalls an
advertisement or other information and remembers that the stock at home is low
or exhausted.
c) Suggestion impulse buying: Occurs when a shopper sees a product for the first
time and visualizes a need for it.
d) Planned impulse buying: Occurs when the shopper makes specific purchase
decisions on the basis of price specials, coupon offers.

1.2. Statement of Issue

Previously impulse buying was synonymous with unplanned purchase, that is

the shopper didnt make purchase planning in advance (Stern, 1962) and it focused on

the product rather than the customers. The importance of understanding impulse
purchasing in retail stores was first identified in the marketing literature over sixty years
ago (Clover, 1950). In todays market oriented society impulsive purchase buying pattern
is increasing. Therefore it is important for the marketers to study the impulse buying
behavior of the consumers.

The study on impulse buying behavior are broadly discussed on the factors that

could stimulate the behavior for customers towards different stimuli. Impulse buying
behavior of shoppers are affected by external factors, internal factors, demographic
factors, situational and socio-cultural factors (Huang & Hsieh, 2011) & (Wansink
1994).

Among these various factors, due to time limitation, we have considered pricing

in terms of discount / offers and in store environment as the concept under the study
influencing impulsive buying.

1.3. Hypothesis

H0: There is no significant relationship between promotional activities, in store

environment and impulsive buying.

H1: Consumers impulse buying behavior and promotional activities has a

positive relationship.

H2: Consumers impulse buying behavior and in-store design & display have a

positive relationship.

2. Conceptual Framework

Historically, impulse buying was defined as unplanned purchase, the concept was

redefined by Rook in 1987. Impulse buying has been defined as relatively extraordinary,
exciting, and more emotional than rational, and it is characterized by (1) relatively rapid
decision making and (2) a subjective bias in favor of immediate possession (Rook D. , 1987)
(Rook & Hoch, 1985).

(Applebaum, 1951) have specifically included "exposure to a stimulus" in the definition

of impulse purchase. Impulse buying refers to as when you purchase something you dont
have in mind or on your shopping list.

(Zhou & Wong, 2004) divided the in-store shopping environment into 2 separate effects;

the promotional effect and the atmospheric effect.

Promotional effect includes discounts, coupon and cheaper prices while atmospheric

effects includes in-store shopping display and designs, advertisement, sales personnel and
buyers buying or crowding.
2.1. Promotional offers and Discounts:

Past researches shows that 88% of impulse buying is affected by the perception of
lower prices when visiting the stores. Consumers use price cues when making purchase
decision. Discounts and offers implying savings create positive emotions in customer
minds which results in a positive response towards the lowered price and induces
purchase.
2.2. In Store Environments:

In store shopping environment has been reported as one of the major determinants

of impulse buying. The in-store designs and displays, background music, well-mannered
and friendly personnel, in-store wall ads and promotion displays, cleanliness as well
scents are all add up to in-store shopping environment.

Discount and
Promotion

Price
Discounts
Campaigns
Advertisments

In Store
Environment

Layout
Employee
Ambiance
Display
Facilities

Impulsive
Buying

Figure 1: Conceptualization of Variables

3. Methodology
3.1. Research Approach

The research focuses of finding the factors influencing the impulsive behavior in

general consumer in Kathmandu. The data collection was primarily done by sending out
a set of questionnaire identified from past research. Due to limitation on resources (i.e.
time and funds), the inventory was modified to fit the scenario and context instead of a
more direct approach, i.e. visiting the stores and asking the customer to fill in the
questionnaire.

The primary objective of the study is to test and examine relationship among the

above discussed variables rather than focusing on new findings. Therefore, a quantitative
approach was used to study, collect and analyze the data.

The questions were administered in digital forms.

3.2. Instrument and Validity

A five point Likert scale type questionnaire was used to the data for study. To

ensure validity and reliability the questionnaire were adopted from past studies. Buying
Impulsiveness Scale (Rook & Fisher, 1995) was used to measure the impulsive behavior.
The question to measure in store environment was developed in reference to Store
Design (Baker, Julie, Grewal, & Voss, 2002) and Store personnel (Baker, Julie, Grewal,
& Voss, 2002).

3.3. Sample and Sample Size

As mentioned due to resource limitations, a convenient sampling was used,

different circles from friends, colleagues and relatives of the researchers were asked to
fill in the questionnaire. A total of 130 questionnaire we sent and only 96 were received.

4. Data Analysis and Findings

4.1. Research Frequencies

Out of the total 130 sent outs the data was collected form 96 samples, 34 were

missed.
4.1.1. Age

Ag

20

40

Tot

Out of the total respondent 79% of the sample were aged 20-39 and 21% were
between age group 40-59.

4.1.2. Gender


43% of the total sample acquired were females and 57% males.

4.1.3. Marital status

A total of 60% of the sample were married and 40% unmarried.

4.1.4. Monthly Income

<

The highest number of sample earning from 20,000 to 40,000 per month
accounted to 42%. The number of people in the sample earning more than 40,000
was 21% and 39% earned below 20,000.

4.2. Analysis

Multiple regression analysis was used to test and find the relation between the

variables. Impulse behavior was measured in term of discount/promotional offer and Instore environment.

Regressio
n
Statistics

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The regression statistics shows that the value of R is 0.5590, this means that the

relationship between the dependent variable Impulse buying and independent variables
Discounts /promotions and in store atmosphere is 55.9%. The statistics also show that
about 31% of the variance in impulse buying is explained by the model.

12

0.

21

Si

0.


To

The ANNOVA table shoes that the model is significant where F is 21.134 and

significance is <0.05.

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The t.Stat and P-value for each of the variable shows that there is a significant

effect of each variable to impulse buying. Here P-value for discount and offers is
0.000<0.05 and in store environment is 0.043<0.05.

Therefore, accepting the alternative hypothesis, H1 and H2.

Looking at the coefficient we can conclude that with a unit change in discount

offer and in store environment the impulsive behavior changes by 56% and 27%
respectively.

4.3. Findings

Discount offers and in store environment has a direct impact on impulsive buying

behavior.
The relation is positive and impulse is triggered when there is a positive change in

the factor and the impulse is withdrawn when the factors are negative.
Among the two factor, discounts and pricing have higher influence on impulsive
behavior in comparison to the in store environments.

5. Conclusion and Recommendations

The findings of this study indicate that discounts promotions and in store environment

influence impulse behavior in general shoppers in Kathmandu. Among the two, discounts and
offers appear to be significant factor to promote impulse buying.

The stores can offer periodic promotion and attractive pricing to induce impulse

buying in the shoppers.

Introducing loyalty schemes offering discounts on purchases can stimulate purchasing

behavior.
Mileage cards, affiliate programs and offers can be provided to the customers to
engage them in buying more.

The second variable, in store environment, though not much effective in comparison to

pricing and offer also plays a part in enforcing impulsive behavior. The in store factors such
as the ambiance, product displays, proper layout, employees, infrastructures and facilities
plays a role in impulsive buying behavior.

Stores, to promote impulsive buying, should create an environment maintain

comprehensible environment and reduce shopping difficulties.

The shopping centers to make it a good buying experience for the consumers should

train and maintain helpful employees.

The store ambiance should be maintained with proper lighting, displays, product
order, color, scents and music.

 Appendix

Questionnaire:

Age

S
e
x
E
d
u
c
a
t
i
o
n

20
Ab
,0
ov
00
e

40
40
,0
,0
00
00
Please tick the most appropriate option that describes your buying
behavior:
SD=Strongly, Disagree, D=Disagree, N=Neutral, A=Agree,
SA=Strongly Agree
Items

Monthl
y
Income
(Please
Tick)

I often buy things spontaneously

Just do it describes the way I buy
things
I often buy things without thinking
I see it, I buy it describes me
Buy now think later describes me
Sometimes I feel like buying things on
the spur of the moment
I buy things according to how I feel at
the moment
I carefully plan most of my purchases
Sometimes I am a bit reckless about
what I buy
I end up buying products with

attractive prices even if it is not in my

shopping list
Discount attracts me to buy things on
the spot
Various schemes (gifts and ofers)
encourages me to buy items that are
not in my shopping list.
My shopping is influenced by in store
advertisements
Attractive product displays
encourages me to buy more
Pleasant ambiance of a store
encourages me to buy more
I tend to buy more when the store
employees are helpful and friendly
The attractiveness of the physical
facilities has a positive influences my
buying behavior
I often end up with less items when
the store is overcrowded

 References

Applebaum, W. (1951). studying Consumer Behaviour in Retrail Stores. Journal of

marketing, 172-178.

Baker, Julie, A. P., Grewal, D., & Voss, G. B. (2002). The Influence of Multiple Store
Environment Cues on Perceived Merchandise Value and Patronage Intentions. JM, 120141.

Bearden, W. O., Netemeyer, R. G., & Haws, K. L. (2011). Handbook Of Marketing

Scales: Multi-Item Measure For Marketing And Consumer Behaviour Research- 3rd ed.
SAGE Publications, Inc.

Clover, V. (1950). Relative importance of impulse buying in retail stores. Journal of

marketing, 15(1), 66-70.

D.Bellenger, Robertson, D., & E.Hirschamn. (1978). Impulse buying varies by products.
Journal of Advertising Research, 18,, 15-18.

Huang, L.-Y., & Hsieh, Y. (2011). What drives consumer impulse buying? Evidence from
a retail setting in Tiwan. Journal of International Management Studies, 6(1).

Rook, D. (1987). The buying impulse. Journal of consumer research, 14(2), 189-99.

Rook, D. W., & Hoch, S. J. (1985). consuming impulses. Advances in Consumer

Research, 23-27.

Rook, D., & Fisher, R. J. (1995). Normative Influences on Impulsive Buying Behaviour.
Journal of Consumer Research,22,, 305-13.

Stern, H. (1962). The Significance of Impulse buying today. Journal of Marketing, 59-62.

Zhou, L., & Wong, A. (2004). Consumer Impulse Buying and In-Store Stimili in Chinese
Supermarkets. Internationl Consumer Market.