Keyword

Pricing, pricing strategies, grocery retailing, consumer behaviour

Abstract

The purpose of this study is to examine the role price as a determining factor in consumer patronage of grocery retail stores in the United Kingdom. A cross-section of grocery consumers (n = 250) constitutes the sample for the study. Grocery stores were grouped and stores were selected for the study on the basis of the variety of grocery stores offers the consumers. A mail survey was used to investigate price perceptions and store choice across three different retail formats. Respondents were grouped into high and low groups for each of the price cue factors. The groups were compared using analysis of variance (ANOVA) for each price construct at each level of the dependent variable for store choice. Findings suggest that price cues affect consumer store choice. Price awareness positively impact patronage of retail stores that implement low cost strategies, while status sensitivity and price/quality plan tend to positively impact patronage of retail stores that implement higher price strategies. As the UK grocery market becomes saturated consumers tend to take advantage of price competition. This is particularly important when communicating store pricing policy to the target consumers


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