BUFFALO, N.Y. -- Specialty stores do not have to compete with
supermarket prices to increase sales, according to a recent study
from the University at Buffalo School of Management.
Researchers found that consumers are not concerned about higher
prices when shopping at specialty stores, and that they are more
likely to buy items related to their main purchase than at a
In addition, specialty stores' customers are more apt to respond
to holiday promotions than to sale prices.
The study was conducted by Ram Bezawada, PhD, assistant
professor, and Minakshi Trivedi, PhD, professor, in the UB School
of Management's Department of Marketing, along with two School of
Management graduates, Ashish Kumar, PhD, assistant professor of
marketing, Aalto University, Finland, and Karthik Sridhar, PhD,
assistant professor of marketing, Ashland University.
Specialty retailers can benefit from the study by adjusting
their sales strategy to focus on premium selection, cross-category
items and holiday promotions, rather than price cuts, to increase
sales, the researchers say.
The researchers analyzed data from 225 households, comparing
candy sales in supermarkets to sales in specialized confectionary
stores. They found that consumers preferred buying premium items,
like boxed chocolates, from the specialty stores and were not
averse to paying higher prices for them in comparison to similar
items at supermarkets.
The results showed also that consumers were more likely to buy
additional premium candies when at confectionary stores than they
were to buy such related items at supermarkets.
Finally, the researchers found that promotions featuring sale
prices at the specialty stores did not have as great an effect on
increasing sales as similar lower-price promotions at the larger
markets. Instead, consumers responded more favorably to promotions
featuring seasonal or holiday themes, such as Valentine's Day or
The UB School of Management is recognized for its emphasis on
real-world learning, community and economic impact, and the global
perspective of its faculty, students and alumni. The school has
been ranked by Bloomberg Businessweek, the Financial Times, Forbes,
U.S. News & World Report and The Wall Street Journal for the
quality of its programs and the return on investment it provides
its graduates. For more information about the UB School of
Management, visit mgt.buffalo.edu.