Senior retail executives are being too quick to dismiss the impact pricing has on consumer purchase decisions, according to a new report by First Insight, Inc.. The company, which recently surveyed consumers and senior retail executives on consumer shopping habits, purchase behavior and influences driving decisions, found that while both groups named quality as the most important factor in purchase decisions (roughly 50 percent of both sets of survey respondents), only 20 percent of senior retail executives felt low pricing ranked as most important, compared to nearly 40 percent of consumers.
The study points to a significant perception gap between senior retail executives and consumers on the current pricing landscape. Only 20 percent of senior retail executives felt that consumers believed prices were increasing online compared to more than half (51 percent) of consumers who reported feeling they were. The same percentage (20 percent) of senior retail executives also felt consumers believed that prices were increasing in-store, compared to 60 percent of consumers.
“While everyone agrees that quality of products is the most important factor in purchase decisions right now, these data show consumers are more concerned with pricing than many senior decision makers in the retail industry suspect,” said Greg Petro, CEO and founder of First Insight. “The impact of this disconnect will only continue to grow as prices rise due to tariffs. Retailer and brand decision makers need to understand consumers’ perceptions to ensure they are able to continually attract today’s consumers with the right price-value equation.”
Results of the survey also indicated that while the majority of senior retail executives felt mobile was the technology having the greatest impact on their business (80 percent), almost no senior retail executives acknowledged the impact of smart speakers. Meanwhile, the number of consumers who said they own smart speakers was up 75 percent to 42 percent of respondents when compared to a similar survey last December. The majority of consumers who own smart speakers are using them to research prices (59 percent), a significant increase from December (49 percent).
Source: First Insight, Inc.