Release Date: March 4, 1996 This content is archived.
BUFFALO, N.Y. -- Wider aisles and brighter colors in a supermarket may not only make shopping a more pleasant experience for the consumer, they also may increase a store’s bottom line, marketing researchers at the University at Buffalo have found.
The appearance of a store, they have shown, strongly influences consumers’ evaluations of private-brand grocery products, which represent a greater profit margin than national brands and which help build store loyalty.
Upgrading less-attractive stores, they suggest, can be a way to boost sales of each and every store-brand product on the shelves.
Consumers shopping at “aesthetically pleasing” stores are more likely to judge the overall quality of private brands to be significantly better than those shopping at less attractive stores, according to results of a study by two UB marketing professors and a colleague from Loyola University.
However, the researchers found no difference in ratings of national brands, based on store aesthetics.
The study, to be published in an upcoming issue of Product and Brand Management, was conducted by Arun K. Jain, Ph.D., Samuel P. Capen Professor of Marketing Research and chair of marketing at UB; Alan Dick, Ph.D., UB assistant professor of marketing, and Paul Richardson, assistant professor of marketing at Loyola University in Chicago.
The study results are based on data provided by 99 shoppers randomly chosen inside two stores of the same major Northeastern grocery chain. The stores -- one aesthetically pleasing and one less attractive -- were chosen by managers of the chain. The aesthetically pleasing store had wider aisles; creative layouts; brighter colors; newer, more modern fixtures, and a cleaner retail environment. The less-attractive store had cluttered configurations of narrow aisles; darker interiors; older fixtures, some of which were in need of replacement, and in general was considered by the managers to be less well-maintained than the more-attractive store.
Shoppers in both stores were given one product to taste-test: either the stores’ brand of grape jelly or Welch’s grape jelly -- a national brand with a strong image that is the leading brand in the market.
Shoppers tasting the store-brand jelly rated the overall quality of the product much lower at the less attractive branch of the chain than at the more aesthetically pleasing store. There was no significant difference in the evaluation of the national brand among the stores.
Moreover, shoppers at the aesthetically pleasing store found no significant difference between the private-label brand and the Welch’s jelly. But at the less-attractive store, the Welch’s jelly was judged to be of better quality than the store brand.
Jain points out that the profit margin for stores is substantially greater on sales of their own private-label brands than on sales of national brands. And preference for private brands contributes to store loyalty, resulting in higher sales of both store and national brands. Yet consumers prefer national brands by a large margin, with store brands languishing with a paltry 14.9 percent of the market, he notes.
But if consumers shopping in aesthetically pleasing stores judge store brands to be of better quality than do shoppers in less-attractive stores, upgrading less-attractive stores could increase sales of private-label brands, Jain says.
“An investment in the aesthetics of the store, i.e., upgrading the quality of fixtures, making the aisles easy to navigate, making the store bright and cheerful, keeping the store clean and making immediate repairs when needed, can indeed help in enhancing the overall quality perceptions of store brands,” the study says.
“Making an investment in store aesthetics provides a big ‘bang for the buck’ because the effect is not product specific,” it continues. “Unlike national brands, which must advertise each product individually in order for them to remain competitive, an improvement in store aesthetics should increase the attractiveness of each and every store brand offered by the chain.
“If retailers can convince consumers that their store brands are better than those of the competition, then these store brands may be used as a hook to lure consumers into the store,” the study says. “Once in the store, consumers buy not only more store brands -- increasing store profitability -- but they are also more likely to fill their entire grocery basket. This greater attractiveness of store brands gives retailers a weapon with which to combat price competition by their retail competitors.”