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Understanding Price Sensitivity in the Grocery Aisle


By Kirk Hendrickson

Interestingly price sensitivity can be efficiently measured across grocery products and brands using eye-tracking technology. The key lies in measuring fixations, where the eye rests on an area (product, price tag, or signage) for 200 milliseconds or longer.

Comparing the share of fixations that fall on price tags compared to products themselves can indicate how sensitive shoppers are to prices in a store or category. For consumer packaged goods and groceries, the share of fixations on price (versus products) varies from 3% to as high as 20% depending on category. Let’s explore some of the examples we have come across in our research.

Multiple factors influence shopper price sensitivity (defined as how often shoppers focus on price compared to product). Often personal preference plays a key role in how much attention shoppers pay to price. Some shoppers spend without considering price much, while the budget conscious are very focused on price. Let’s look at a few factors identified through eye tracking research:

  1. Differences in package size and shelf space allotted to breakfast food categories show smaller packages on tighter shelves influence shoppers to spend more time viewing price tags.

When it comes to breakfast, yogurt and cereal are two major categories. In this case, shoppers were fitted with eye tracking glasses and asked to shop their grocery store as they normally would.  The data showed that among cereal shoppers (n=29) 94% of fixations fell on products and 6% on price, while yogurt shoppers (n=27, with overlap) 85% of fixations fell on products and 15% on price.

With fixations on price varying from 3% to 20%, cereal falls on the lower end, yogurt on the higher.  A number of factors related to the consumer and the store set up influence these differences. One is how much more space cereal packages take up compared to the price tags on shelf. Cereal boxes draw a greater share of shopper attention than do yogurt packs, which come in smaller packages that are not much bigger than their price tags. Not only are cereal boxes larger, but in typical grocery stores, the products can have several facings for a single SKU and only one price tag, while yogurt products come in many flavors and each stack of 2-4 products has a price tag directly below.

  1. Comparison of price sensitivity of household category (cleaning and personal products) between a grocery, drug store and mass merchandizer

The type of store influences shopper sensitivity to price tags with certain types of stores lending themselves to shoppers being more price sensitive, depending on category.

When looking at household goods like cleaning supplies and personal items, grocery stores, mass merchandisers and drug stores illicit different responses from shoppers when it comes to how much attention is paid to price tags. In one particular study, shoppers were the most sensitive in drug stores, where almost one in five fixations fell on price while in grocery stores one in 10 fixations fell on price and at mass merchandisers, only 6% of fixations fell on price as opposed to product.

  1. Shopper mood influences price sensitivity

In the same study, conducted with the Ipsos Neuro and Behavioral Science Center, all shoppers shopped the grocery categories, however, one group of shoppers was given a daisy to test how this simple act of elevating mood might affect price sensitivity. The results were astounding.  After receiving a free flower as part of the test, shoppers were significantly less likely to focus on price and significantly more likely to focus on product.

According to Elissa Moses, CEO of the Ipsos Neuro and Behavioral Science Center, “the suggestion is that mood elevation can trigger a lower sensitivity to price. This could have huge implications for retailers.” Enhancing mood with something as simple as a free daisy can make shoppers spend more and be less price conscious.

  1. Price tags of products on sale receive more attention while the associated products receive even higher attention levels.

Relative size can have a big influence on how attention falls on price tags. By this logic, sale tags, which are usually larger and brighter tend to draw more attention than standard price tags. In one study, regular price tags received 6% of fixations as opposed to 94% on their associated products, while sale items in the same aisle received 18% of fixations.

While it should come as no surprise that sale tags receive greater interest than regular price tags, it’s also true that products on sale (identified by a sale tag) draw additional attention provable with eye tracking. In the earlier example, 58% of the products in this particular grocery aisle were on sale (42% were regular priced) with the sale products accounting for 71% of product fixations while products not on sale accounted for only 29% of fixations.

Understanding how price sensitivity differs between categories and retailers and across international lines can help brands and retailers better understand how the consumers that purchase their products are considering or not considering the price of the product as they make their ultimate purchase decisions.


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2 responses to “Understanding Price Sensitivity in the Grocery Aisle

  1. Kirk, this is all pretty exciting stuff and confirms some of what we see in China. What worries me a tad, having looked at a lot of heat maps is the accuracy of the results. Clients lap this stuff up, but I keep seeing uncertain areas of focus and in fact occasionally what appears to be looking at nothing in particular. I ask this because you seem to be claiming that attention can be identified down to areas as fine as price tags. Unless you have some super new technology I would question the accuracy of that. Heat maps are rarely that precise.

  2. @Kirk – interesting differences, especially within store-types. We might expect the results you got given drug tends to be higher priced than grocery, which is higher priced than mass merch. Good to see it confirmed. The next question, which I’m hoping our work together can show, is that looking at prices more makes one more price sensitive.

    @Chris – we’ve just done some work with Kirk, still in analysis, that shows similar viewing patterns from a real store and a virtual reality shelf – we’re pretty excited about that! It’s always been a question for VR – do people look at a store in the same way?

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Kirk Hendrickson

Kirk Hendrickson

Co Founder & Chief Executive Officer, Eye Faster