Study Finds Limited Impact of Deal-Seeking Shoppers

Consumers who are so aggressive in their quest for low prices that they have a negative impact on food retailers’ margins make up only about 1% of a store’s total customers, according a new study by the Yale School of Management and the State University of New York at Buffalo. Such shoppers reduce retailers’ profits by about 0.2%, the study found. The study divided consumers into four groups: temporals, who always shop at the same store but look for deals when they become available; spatials, who travel to different stores on each trip looking for the best deals; spatio-temporals, who make regular weekly trips to multiple stores to get the best deals over time; and incidentals, who do not search for promotions at all. Spatio-temporals achieved the greatest savings, capturing 76% of the available deals, but even incidentals were able to reap 54% of the savings available.

Sep 14, 2007

NEW HAVEN, Conn. — Consumers who are so aggressive in their quest for low prices that they have a negative impact on food retailers’ margins make up only about 1% of a store’s total customers, according a new study by the Yale School of Management here and the State University of New York at Buffalo. Such shoppers reduce retailers’ profits by about 0.2%, the study found. The study divided consumers into four groups: temporals, who always shop at the same store but look for deals when they become available; spatials, who travel to different stores on each trip looking for the best deals; spatio-temporals, who make regular weekly trips to multiple stores to get the best deals over time; and incidentals, who do not search for promotions at all. Spatio-temporals achieved the greatest savings, capturing 76% of the available deals, but even incidentals were able to reap 54% of the savings available.