Academic journal article The Journal of Consumer Affairs

Misperceptions of Grocery Advertising

Academic journal article The Journal of Consumer Affairs

Misperceptions of Grocery Advertising

Article excerpt

Research into consumer shopping problems shows that high food prices are a primary concern to consumers (Claxton and Ritchie 1978). The major source of consumer information about food prices is weekly newspaper advertising of specials by grocery store chains. The importance of this price information to consumers is exemplified by the fact that 55 perrcent of shoppers check newspaper advertisements before purchase (cf., Wilkinson et al. 1980). Because a food item is advertised does not mean it is reduced in price. Research by Wilkinson and Mason (1974) found between 13 and 15 percent of items advertised at any one time were not reduced in price. Mason and Wilkinson (1978) reported that 48 percent of all grocery items advertised over a ten-week period were at the regular price.

Other research by Wilkinson, Mason, and Paksoy (1982) found that consumers are reluctant to respond to advertised food specials. Some consumers simply do not believe that items are on sale. Given the percentage of nonreduced advertised food specials, consumers may indeed be acting rationally. Findings such as these explain why consumers are generally skeptical of advertising (Calfee and Ringold 1988). Other possibilities why consumers do not respond to advertised specials are found in Liefeld and Heslop (1985). They found that consumers heavily discounted the ordinary selling price of the good when only presented with sale price information. When no reference price is given in grocery advertising, consumers may find it difficult to determine if the advertised price is reduced and hence if they can save by purchasing the item.

The study has two distinct contributions. It simultaneously measures advertised savings and consumers' perceptions of average savings and it determines if consumers who believe advertised brands to be of better quality have different perceptions about perceived savings, than consumers who do not believe advertised brands are better. To date no study has simultaneously examined the advertising practices of a large retail chain and compared these to consumer perceptions of that advertising. This survey method lacks controls usually used in experimental price investigations (e.g., Wilkinson, Mason, and Paksoy 1982), and does not give insight as to what causes perceptions.

This study is meant to be exploratory so that insight is gained as to what consumers' price and advertising perceptions are in their shopping environment. Measurements were made of (1) the percentage of items advertised on sale, (2) the percentage of consumers who thought the items were on sale, (3) how much the consumer is actually saving, and (4) consumer perceptions of saving on advertised items.

CONTENT ANALYSES OF ADVERTISEMENTS

AND COMPARISON TO REGULAR STORE PRICES

Newspaper advertisements from Safeway Canada were collected over a two-week period starting November 29, 1988, and ending December 14, 1988. Safeway has 35 percent market share in the survey area and represents a major North American food retailer (Financial Times 1987). All grocery products advertised in the time period were coded as to regular and advertised prices. Regular prices were obtained by the researchers after price checking each advertised item in the store during the test period. Regular price was defined as the price the item sold for immediately before advertising in the flyer. In most cases, individual items are not priced so special tags are put on shelves over regular prices. Prices underneath the special tags were noted by the researcher. A total of 308 items were advertised by Safeway Canada in the data collection period.

Advertised items were categorized using guidelines from content analysis (Kassarjian 1977). Food groups were formed to coincide with other groupings used for tracking consumer food expenditure patterns (e.g., Statistics Canada 1984). The food groups were dairy products, eggs, bakery products, cereal products, meat and pultry, fish and seafood, fats and oils, beverages, fresh fruit and vegetables, and miscellaneous grocery products. …

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