To Buy or Not to Buy

By Rachel Carlson

There can be a lot of anxiety when shopping this time of year, whether that be getting the right gift for a loved one or finding the best deal.

For many shoppers, it can all become a little overwhelming, Ashley Otto, associate professor of Marketing at Baylor University’s Hankamer School of Business (HSB), said. In a prior study, she identified a particular set of shoppers who are less likely to make a decision.

“We found that people who are seeking cognitive closure—those who dislike uncertainty and ambiguity—are averse to decisions,” Otto said. “These individuals strategically sidestep the decision process by relying on a variety of choice strategies, such as repeating a prior decision or choosing an option deemed as favored by others.”

There are a multitude of other factors that influence consumer decision making, Otto said. Cultural and social factors can also play a significant role in shaping consumer behavior, especially during major shopping holidays like Black Friday.

“One category that I have always found intriguing—but I don’t study myself—is shopping in the presence of others,” she said.

Previous research in this area has shown that impulsive shopping increases in the presence of peers, Otto said. However, if those present are family members, shoppers are shown to decrease impulsive shopping.

Visual factors also influence purchasing habits, she said. Studies have found that shoppers are more likely to purchase a product when it has been physically touched by an additional shopper they find attractive.

Other studies have identified online advertising as an important factor, Otto said. One such study found that online ads increase search speed, with 90 percent of consumers having searched for a product on a website after clicking on an ad.

“What their work shows is that search time post being exposed to an online ad decreases,” Otto said. “Consumers are then making their decisions faster.”

Black Friday is synonymous with sales and clearance events, and these have a powerful impact on consumer behavior, Chris Pullig, chair of the Department of Marketing at HSB, said. When an item goes on sale, consumers may infer that it will become less available as many others will also want it.

“When items are offered as 'on sale/clearance,' the norm is to list the original price,” Pullig said. “This serves as a comparison of the actual value of the item offered. Consumers then compare the selling price to the original price and see the deal as having financial value.”

Black Friday deals operate similarly, he said. These deals signal scarcity and low prices. The stores offering the deal invest in an event that makes the offer seem more valid. Consumers look for valid signals to confirm that a deal has value.

While there are many reasons sales work, Otto identifies scarcity as a particularly powerful factor.

“We know that scarcity is a very effective persuasion tactic, whether it is scarcity of time or scarcity of availability,” she said. “Sales are one way in which retailers can create scarcity.”