South African Journal of Economic and Management Sciences, Vol 10, No 2 (2007)

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The correlation between cherry picking and the distance that consumers travel to do grocery shopping

Louise Van Scheers, Mike Cant

Abstract


Retailers often use price promotions to discriminate between consumers who can shift purchases over time and those who cannot. Retailers consistently tend to charge lower prices than necessary, pricing defensively to prevent loyal customers from cherry picking, or shifting to competitors. Knowledge about cherry picking behaviour will enable retailers to obtain a higher share of disposable income from even price-sensitive shoppers, while at the same time charging higher prices. Recent studies indicate that effective cherry picking entails saving costs through price searching over time, price searching across stores, or both. This study examines the relationship between cherry picking and the distance that consumers travel to do grocery shopping. Interviews were conducted at ten different retail outlets over three days, and the results show that there is a highly significant correlation between cherry picking and the distance that consumers travel to do grocery shopping.These results should help retailers to benefit from cherry picking by taking a proactive approach to store switching and store location, two of the main influences on cherry picking behaviour.

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EISSN 2222-3436 (Online)