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Note: this article was originally published in full in Brand Quartley Magazine on January 5, 2017

Price sensitivity and how it is affected by package design, size, and shelf layout is an interesting phenomenon that can be precisely measured using eye-tracking technology. This methodology for measuring price sensitivity can be applied to brands and categories across all retailers.

The key data lies in measuring ‘fixations’ – how long one’s eyes focus on a given area of a package, sign, shelf, etc. For consumer packaged goods and grocery products the share of fixations on price versus products can vary from a low of 3% to as much as 20%, depending on the product category and the retailer.

While there are a number of factors, I’ve consistently found that package size and placement are key in influencing shopper price sensitivity (defined here as: how often shoppers focus on prices compared to products).

Price In The Breakfast Aisle

When it comes to breakfast, yogurt and cereal are two leading categories that shoppers regularly purchase. In a recent study, executed in partnership with the Ipsos Neuro and Behavioral Science Centre, shoppers were fitted with eye-tracking glasses and asked to shop their grocery store as they normally would. The resulting data showed that among cereal shoppers (n=29) 94% of fixations fell on products and 6% on price; in the yogurt category (n=27, with overlap) 85% of fixations fell on products and 15% on price.

A major factor is how much space cereal packages occupy in relation to price tags on the shelf. Larger packages, like cereal boxes, draw a greater share of shopper attention than do smaller packages, i.e. yogurt, which tend to be closer in size to their price tags. Not only are cereal boxes larger, but in typical grocery stores, the products on-shelf often have several facings of a single SKU and but one price tag, while yogurt products come in many different flavors, and are often stacked 2-4 products high or wide, with a single price tag directly below.

Read the rest on Brand Quarterly. 

 

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