Are retailers out-of-step with consumers when it comes to price?
A recent survey of senior retail executives and consumers found that both groups are in agreement that quality is the most important factor in purchasing decisions. There is a big disconnect between the two, however, when it comes to the importance of price in deciding what to buy.
Only 20 percent of executives think pricing is most important in purchasing decisions. Way more consumers (40 percent) say price is the most important factor in deciding what to buy.
Price perceptions are also in stark contrast between the retailers and consumers surveyed. Only twenty percent of retail executives think consumers believe prices are going up online and in stores. Consumers see this differently, with 51 percent reporting online prices increasing and 60 percent saying that they are paying more for in-store purchases.
“These data show consumers are more concerned with pricing than many senior decision makers in the retail industry suspect,” said Greg Petro, CEO and founder of First Insight, in a statement. “The impact of this disconnect will only continue to grow as prices rise due to tariffs. Retailer and brand decision makers need to understand consumers’ perceptions to ensure they are able to continually attract today’s consumers with the right price-value equation.”
Thirty-six percent of consumers point to price promos, coupon availability and better pricing as one of the three biggest factors that make them choose to shop in a store rather than online. Only 12 percent of retail executives think these factors are important when consumers determined where they will shop.
Consumers and retailers surveyed agree that being able to see and touch products and being able to take a purchase home immediately are among the three top factors in whether to shop in a store rather than online. Retail executives, in both cases, see these as more important than consumers. Thirty-six percent of consumers rank being able to see and touch products among their top three factors compared to 44 percent of executives. The divide is even more noticeable on being able to take immediate control of a purchase. Forty-one percent of consumers name this as a top-three factor compared to 59 percent of retailers.
- First Insight Survey Finds Significant Disconnect Between Senior Retail Executives and Consumers on Impact of Pricing – First Insight
DISCUSSION QUESTIONS: How well do most retailers understand the importance of various factors involved in consumer purchasing decisions? Do you think the findings of the research cited in the article are reflective of current reality or are they an outlier in some way?