Ascendency of Pricing Strategies on Impulsive Buying Behavior with Reference to Retail Consumer Goods in Sri Lanka: A Comparative Study on Generations X, Y and Z

Abstract

With the extensive development which has undertaken by the information providers in the world, today’s consumers have become more powerful and informative, intelligent entities where they are knowledgeable with both content and intent of the product or service before they purchase the product or service. The success of the business is always depending on how well it satisfies the consumer needs and wants. In order to satisfy the consumers and create a consumer base which might come again for the shop is a bit of difficult task which is done by collaborating all the elements of the marketing mix such as product, price, place and promotion. In that, pricing can be recognized as one of the most important element and it plays a significant role at the customer point of view as well as from the business point of view. Designing price for a particular product is the most important thing for a business where the greater the importance of price in purchase decisions, the greater the intensity of information and the greater the amount of comparisons between the competitor brands. Other than that, as the consumer always seeks for price reductions for retail consumer goods, those reductions should be designed for a price of a product with the purpose of increasing sales volume of the product and it should be taken a formation of price promotions such as, discounting, price discriminations, bundle pricing and etc. Since the consumers are so much of price sensitive, this is the first and foremost way of attracting consumers in to the store. In order to do that, business owners are engaged with number of pricing strategies to secure their position within the market. So, it is expected to test the pricing strategies and its impact on impulsive buying behavior of the customers towards the retail consumer goods and it will take a form of a comparative study in generations X, Y and Z. So, the problem centered for the study is “How far the pricing strategies effects on impulsive buying behavior with reference to retail consumer goods”. Although number of previous research studies has been conducted on the said arena, few research studies can be found on the comparative study of pricing effects in between the generations of X, Y and Z. So, it became a fine researchable area as it fills the vacuum of the existing literature. It takes a conclusive research design for the study, sourced both primary and secondary data and used a self-administered structured questionnaire mainly as a data collection instrument. Both focused group interviews and in-depth interviews have conducted with the purpose of getting more consumer insights. Convenience sampling technique has used for the study and 150 respondents representing X, Y, Z generations (50 from each) were selected for the study from Central province. Collected data has enteredto a master sheet and fed to the PC by using Ms Excel and finalize the analysis with the help of both SPSS and Excel. Descriptive statistics used to analyze the data while graphs, charts have used to present the data as well as correlation has used to test the hypotheses of study. Odd even pricing, bundle pricing and discount pricing have used as the independent variables of the study while impulsive buying behavior has identified as the dependent variable of the study. Throughout the study, it has found that, pricing strategies are significantly influence on the impulsive buying behavior of the customers. Furthermore, it has found that, based on the type of the pricing strategy which is used by the marketers, there’re some differences in between the generations of X, Y and Z. There’s a strong positive impact can be seen in the odd even pricing and discount pricing to the impulsive buying behavior of the consumers in generations X & Y while there’s a positive moderate impact showed from the odd even pricing, discount pricing to the impulsive buying behavior for the generation Z. Also, it found that, bundle pricing strategies are significantly and positively influenced on the impulsive buying behavior of generations X, Y and Z. Other than the findings and analysis done through the quantitative data which has shown above, there are some qualitative findings which are gathered throughout the study. The basic finding derived from the study was that, the people who lived in Central province are so much of price concern and they are very sensitive at pricing and the majority of them are considered about the pricing other than the quality of the product or the brand, when purchasing a product. When it comes to visualizing the price reductions, mainly there’re two ways namely, percentage reductions and price amount reductions. According to the current study, it has found that, majority of the people who lived in central province are continuously sensitive for the price amount reductions rather than the percentage reductions.