RMIT Classification: Trusted

MKTG 1421 -
Consumer Psychology
& Behaviour

Topic 6: Outlet selection and

product purchase

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Outlet selection and product purchase

Figure 1.6 / The consumer decision
process Consumers have selected a
brand and need to select a store.

What criteria is used to select a

store?

In-store factors may change the

brand they buy.

Sometimes, they select the store

before they choose a brand.
Note: Dotted lines represent the
potential for a step back
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Learning Objectives

1. Outlet choice vs. product choice

2. The retail scene

3. Attributes affecting retail outlet selection

4. Consumer characteristics and outlet choice

5. In-store influences that impact on

evaluation of alternatives and purchase

6. Purchase

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Activity: Marketing strategy based on

the consumer decision sequence
1. Brand first? What should the brands do?

2. Store first? What should the stores do?

3. Brand and store simultaneously? What should the stores and the
brands do?

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Marketing Strategies
Table 6.1 / Marketing strategy based on the consumer decision sequence
Level in the Channel
Decision sequence Retailer Manufacture
Outlet first, brand Image advertising Distribution in key outlets
second Margin management on shelf space, Point-of-purpose, shelf space position
displays Programs to strengthen existing
Location analysis outlets
Brand first, outlet Appropriate pricing More exclusive distribution
second Many brands and/ or key brands Brand-availability advertising (Yellow
Cooperative advertisement featuring Pages)
brands Brand-image management
Simultaneous Price specials on brands, Yellow Programs targeted at retail sales
Pages listings under brands personnel
Margin training for sales personnel Distribution in key outlets
Multiple brands/key brands Cooperative advertising
High-service or low-price structure

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How Nike gets reluctant runners to run?

(Short, N,
Nolan, M
2020)
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Attributes affecting
retail outlet selection
Retail format

Types of stores

• Low-involvement buying: Convenience stores, supermarkets, discount

stores, vending machines, mail order, telephone order

• High-involvement buying: Department stores, specialty stores

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Criteria affecting retail outlet selection

What are the evaluative criteria used by consumers when choosing a

store?

1. Retail format

2. Store image

3. Store brands

4. Retail advertising

5. Outlet location and size

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Criteria used for store evaluation and

selection
1. Location
Type of retail
2. Assortment format
3. Price
4. Advertising  Evaluate retail
5. Promotion competitors
6. Sales personnel
7. Service Choose store
8. Customers
9. Store atmosphere Purchase
10. Post purchase services
11. Satisfaction Outcome

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Criteria for outlet selection: Store image

(2)

Creates Consumer
may stay
feelings longer
Creates Store
Atmosphere Creates
Consumer
consumer
remembers
experience

Store image and

store personality

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Criteria for outlet selection: Store image

(3)
Store image dimensions
Merchandise Quality, selection, price, style
Service Sales assistance, return, credit policies
Clientele Customers
Physical features Clean, layout, colour etc
Convenience Location, parking
Promotion Advertising
Store atmosphere Fun, excitement, comfort etc
Institutional Store reputation
Post-transaction Customer satisfaction
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Digitalization amid Covid-19

(Kotler et al
2021, p. 73)

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How Alibaba’s omni channel/new retail

integrates online and offline?

(Alibaba
2018)
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Activity: develop a set of

relevant criteria for online stores
Criteria for offline Specifications Criteria for online stores Specifications
stores
Location Distance, traffic    

Price Price ranges    

Merchandise Quality, selection, price, style    

Service Sales assistance, return, credit    

policies
Clientele Customers    

Physical features Clean, layout,colour etc    

Convenience Location, parking    

Promotion Advertising    

Store atmosphere Fun, excitement, comfort etc    

Institutional Store reputation    

Post-transaction Customer satisfaction    

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Criteria for outlet selection:

Store image and impact of colour
Example:

• Red outside the store attracts attention 

• Red inside makes the store atmosphere tense

or negative Source

• Cooler relaxing interior colour retains

customers longer  

Source
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How does music affect shoppers?

(WCCO -
CBS
Minnesota
2017)
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Criteria for outlet selection: Store image. 

Impact of music on consumer behaviour 
Slow music Fast music

Service time 29 min 27 min

Customer time at table 56 min 45 min

Customer groups leaving
10.5% 12%
before seated
Amount of food purchased $55.81 $55.12

Amount of bar purchases $30.47 $21.62

Estimated gross margin $55.82 $48.62

(Miliman 1986)

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Which store image dimensions can you

identify ? (1)

Source
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How did Canon help small shops

with their store images?

(Poulsen &
Marcel 2017)

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Criteria for outlet selection:

Consumer shopping orientation
1. Reason for shopping or a preferred shopping style

2. Consumers’ shopping motivation helps identify their shopping

orientation

3. Influences their choice of retail format

4. Retail strategies must accommodate core customers

5. Why do you shop?

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Criteria for outlet selection: Consumer

shopping orientation and perceived risk
Shopping orientation: Shopping style

• Love shopping, hate shopping, shop online, look for discounts, don’t
have time etc.

Perceived risk

• Financial risk: Consumer’s perceived risk to financial status as a result

of purchase

• Social risk: Consumer’s perceived risk to personal image as a result of

purchase

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Criteria for outlet selection: Types of

perceived risk
Table 6.6 / Financial and social risks for various types of products
Financial Risk
Social Risk
Low High
Wine (home use) Lawnmower
Socks Car repairs
Low Kitchen supplier Washing machine
Pens/pencils Insurance
Petrol Doctor/solicitor
Fashion accessories Business suites
Hairstyle Living-room furniture
High Gifts Car
Wine (entertaining) Mountain bike
Aerobics clothes Ski outfit
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Using price to indicate quality

Source

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Activity: What are the levels of financial

and social risks?
Product category YOU Financial risk Social risk
     
(a) Mobile phone For your own use    
 
(b) Birthday present For your girlfriend    

(c) Legal services For your family    

 
(d) Toothpaste For your own use at    
  home
(e) Motorbikes For you    

(f) Clothes For your home wear    

For special events

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Criteria for outlet selection: What is your

shopping motivation?
1. To buy

2. Diversion
Personal Social
3. Leisure motives motives

4. Sensory stimulation

5. Social interaction

6. Learning about new trends

7. To exert interpersonal power over sales staff

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In-store factors affecting evaluation of

alternatives and purchase
Displays
Price
reduction

Modifying
Store Alternative intended
layout Evaluation purchase
behaviour

Stockouts

Sales
personnel
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In-store factors affecting evaluation of

alternatives and purchase (1)
POP devices at the point of sale to
encourage consumers to buy.

• posters

• cards

• shelf wobblers

• etc.

Source
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In-store factors affecting evaluation of

alternatives and purchase (2)
POP and digital displays inform
consumers or encourage them
to buy.

1. Attract attention

2. Inform

3. Stimulate purchase

4. Increase sales

5. Add atmosphere
source Source
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In-store factors affecting evaluation of

alternatives and purchase (3)
• How does your brand perform in-store?

Fully planned Partially planned Unplanned

purchase purchase purchase
• Brand has been • Plan to buy in • Product category
selected. High product category and brand choice
involvement, but will select made in store.
repeat or brand brand in store, or • In store marketing
loyal purchases. on website. tactics have
• Consumer may • In-store strong impact.
be interrupted by marketing tactics
in-store marketing may influence
tactics choice.

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In-store factors affecting evaluation of

alternatives and purchase (4)
With point of purchase (POP) materials, sales promotions may increase
because:

1. Current customers buy ahead

2. Users of competing brands may switch

3. Non-users may buy as a substitute

4. Consumers who do not normally shop at the store may come to the
store to buy brands on promotion

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Example: Impact of retail advertising

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Outlet selection: Consumer shopping

experience and store layout
Prepare
to shop

Going Arrive
home at store

Check Enter
out store

Move
through
store

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Criteria for outlet selection: Store layouts

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Outlet selection: Store layouts

Different floor plans effect consumer traffic flow and sales

Straight Floor plan Diagonal Floor plan

Geometric Floor plan Angular Floor plan

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Outlet selection: Consumer shopping

experience and store layout
Consumer logistics:
Impact of crowding in
store

Note: There are cultural

differences 

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Why people spend so much at Costco?

(CNBC 2019)
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In-store factors affecting evaluation of

alternatives and purchase: Stock-outs (1)
Store is temporarily out of a particular

brand so consumers may decide:

1. To buy same brand at another store

2. To switch brands

3. Delay purchase
Source
4. Not buy at all

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In-store factors affecting evaluation of

alternatives and purchase: Stock-outs (2)

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In-store factors affecting evaluation

of alternatives and purchase: Stock-outs (3)
Impact on Effect
• Purchasing a substitute brand or product at the original store. The substitute
brand/product may or may not replace the regular brand in future purchases.
• delaying the purchase until the brand is available at the original store.
Purchase
• Forgoing the purchase entirely.
behaviour • Purchasing the desired brand at a second store. Either of the items initially desired
or the stockout items only may be purchased at the second store. The second
store may or may not replace the original store on future shopping trips.
• The consumer may make negative comments to peers about the original store.
Verbal • The consumer may make positive comments to peers about the substitute store.
behaviour • The consumer may make positive comments to peers about the substitute
brand/product.
• The consumer may develop a less favorable attitude towards the original store.
• The consumer may develop a more favorable attitude towards the substitute store.
Attitude • The consumer may develop a more favorable attitude towards the substitute
shifts brand/product

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Outlet selection criteria: Sales Personnel

Can have great effect on purchases, especially high-involvement

purchases

a. Salesperson’s knowledge, skill and authority

b. Nature of the customer’s buying task

c. Customer-salesperson relationship

Source Source
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Purchase

• Complete transaction – Facilitate purchasing?

• Payment methods – cash, credit cards (Visa, Mastercard, American

Express), bank cards (Vietcombank Connect, DongA, ANZ card)…

Source Source
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Activity: Analyse your shopping bill

• Bring your latest shopping bill and analyse if the items are planned,
partially planned or unplanned purchases? What made you buy?

Source

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Summary: Evaluating and selecting

alternatives
Figure 1.6 / The consumer decision process

Sometimes, consumers select

the store first, or the brand first or
both

Store evaluative criteria

In-store influences
Note: Dotted lines represent the potential
for a step back
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Wrap up: what have you learned today?

• Twitter Board: Write down what

you have learned in today lesson
using 140 characters in small
strips of paper. Post the notes to
the board to resemble a Twitter
feed.

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Reference list (1)

Alibaba Group 2018, Alibaba's "New Retail" Explained, Alibaba Group

YouTube, viewed April 16 2021, link to external site.  

CNBC 2019, Why You Spend So Much Money At Costco, viewed April 16
2021, link to external site. 

Kotler, P, Kartajaya, H, & Setiawan, I 2017, Marketing 4.0. Moving from

Traditional to Digital, John Wiley&Sons. Inc., Hoboken, New Jersey, 32.

Miliman, R 1986, ‘The Influence of Background Music on the Behaviour of

Restaurant Patrons’, Journal of Consumer Research, September, p.289.
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Reference list (2)

Poulsen,  P & Marcel, G 2017, Canon: Local Business Never Looked So

Good, WARC An Ascential Company, viewed April 16 2021,
link to external site. 

Quester, P, Neal, C, Pettigrew, S, Grimmer, M R, Davis, T, & Hawkins, D

2014, Consumer behaviour: Implications for marketing strategy. McGraw-
Hill.

Short, N, Nolan, M 2020, Nike Running: Nike Joyride – Getting Reluctant

Runners Running, WARC An Ascential Company, viewed 16 April 2021,
link to external site.
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Reference list (3)

WCCO - CBS Minnesota 2017, How Does Music Affect Customers?,

WCCO - CBS Minnesota YouTube, viewed 16 April 2021,
link to external site.

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