Planned or Impulse Purchases? How to Create Effective Infomercials

TOM AGEE

University of Auckland,

New Zealand t.agee@paradise.net.n2

BRETT A. S. MARTIN

University of Auckland,

New Zealand bas.martin@auckland.ac.nz

 

Conventional wisdom suggests that most purchases made from infomercials— 30-minute direct-response television advertisements—are made on impulse. However, this study of 878 infomerciai purchasers of six products from a major internationai infomerciai marketer indicates that the majority of purchase decisions invoived some degree of planning rather than simpiy being made on the spur of the moment. Factors infiuencing whether a purchase was an impulse or planned decision included: comments by experts, demonstrations, the levels of previous product interest, prepurchase thinking about the product, and prior exposure to the advertisement, as well as the number of infomercials viewed by consumers. Having children aged between 10 and 14 years old also had an influence.

 

INFOMERCIALS REPRESENT A FORM of advertising of considerable commercial significance. In 1996, advertisers were reported to have spent $800 million on infomerciai time (Lockard, 1997), with infomercials more recently generating global sales of $75 billion {Direct Marketing, 1999). Furthermore, a number of large companies are using or planning to use infomercials, including Cadillac, Philips, Ericsson, and Volvo (Guilford, 1999; Krol, 1998; Halliday, 1999; Wasserman, 1999).

 

Yet despite the commercial importance of this form of advertising, there is little past research in this area. This is surprising given that iitfomercials, as a form of direct-response advertising, have been highlighted as different from other types of television advertising. For instance, Andrews (1999) suggests that direct-response advertisen\ents provide consumers with enough information to make a purchase decision, as well as giving them a way to purchase the product immediately. This study addresses this gap in previous research by examining two research questions:

1. Are infomerciai purchases planned or impulse decisions?

2. What factors influence whether an infomerciai purchase is planned or impulse?

 

CONCEPTUAL BACKGROUND

Infomercials have been defined as a longer than average advertisement that ranges in duration from 3 to 60 minutes (Belch and Belch, 1993). They form a subset of the broader category of directresponse television advertising that can be split into three categories: infomercials, short-form commercials—usually two minutes or less—and home-shopping-channels devoted entirely to selling products via television on a 24-hour-a-day basis.

 

An intriguing feature of infomercials is that they may appear to the viewer initially as a program rather than a commercial. The long duration of infomercials also increases the chances of catching channel surfers (Duket, 1997). Indeed, the fact that viewers happen upon the infomerciai rather than actively seek it out is reflected in the typical construction of an infomerciai. They usually consist of segments containing demonstrations, with testimonials by experts and satisfied users separated by two internal commercials. In addition, they contain the offer, price, payment options, telephone number, and a repeated call for action. Each segment can stand on its own, thus viewers are able to tune in during any segment and receive a complete sales presentation.

 

Although there may be no other form of direct-response advertising that produces such measurable results so quickly, there ‘ “*’L t J. is little published research in the area. Respondent Demographjc Profile Elliott and Speck (1995) were the first to , , ,-• 11 • i: • 1 T-i • Demographics Frequency Percent* look specifically at mfomercials. Their ° ••• •. study was of viewer characteristics and Gender how these might relate to attitudes and ….1^.^.’.?. ^®.? ?:.?-.^ purchase intentions.

 

A mail survey by El- Female 716 81.5 liott, Speck, and Alpert (1995) indicated ^ g that viewers generally had negative be- <20 38 4 4 liefs about infomercials, which signifi- 20-29 257 29 6 cantly affected attitude and purchase in- . .• uu u ..1.J-.- 1 . 30-39 299 34.5 tentions, although additional exposure to infomercials did have a positive effect. ….^9!7!^^. ‘^^^ “‘”^’^ Donthu and Gilliland (1996) studied the 50-59 79 9.1 psychographics of infomerciai shoppers, 60-64 18 2 1 describing them as heavier television ^ 65+ 26 3.0 viewers who are more convenience seeking, variety seeking, innovative, and risk Household Income accepting.

 

Thus infomercials appear ‘. „…”.„ to have the potential to evoke impulse ….!.2.9.’.99?.7.^29’OO9 107 13.1 buying. $30,000-$39,000 134 16.4 Impulse buying ….?.’!’:9.’.99?.T.!5.?’.9.°.9 ^.^9 14.7 Impulse buying has been defined as a $50,000-$59,000 108 13.2 spontaneous, immediate purchase (Rook $60,000-$79,000 98 12.0 and Fisher, 1995). The consumer is not ac- ••••$8o;oo(^$99!oOO 63 ‘j.l tively looking for the product and has no prior plans to purchase (Beatty and Fer- ….?.1.9.°.’.99.9:^ ^.? l.^. rell, 1998; Weun, Jones, and Beatty, 1998). Education Rook and Hoch (1985) assert that people ….::.’Ji^^..^.’i=.’;’.°.°|.S”.^.^.^?^.^. 363 42.0 experience consuming impulses. Further- High school graduate 145 16.8 more. Rook (1987) identifies this buying Technical or trade qualification 97 11.2 impulse with descriptors such as a sponOther tertiary qualification 153 17.7 taneous, intense, exciting, urge to buy with the purchaser often ignoring the con- ….^°!^.^..^.9}}3^. ?^. .2.-9 sequences. While research in this area dis- College graduate 81 9.4 cusses impulse buying as a trait, rather Marital Status than as the classification of a purchase de- Single 168 19.4 cision, researchers agree that consumers “Married/Living together 589 Q8.1 vary in their impulse-buying tendency (Pud, 1996; Rook and Fisher, 1995). Re- …’^^’i”/’^^ . ^3 9.6 garding the impulse infomerciai decision, ….y:.’…?.^.^… _ .^..^ Stern (1962) has offered the suggestion ef- (continued) feet of unplanned purchase. Here, unaware of a new product, the consumer is TABLE 1 the TV purchase; previous interest in the Cont’d *^P^ °^ product purchased; previous ex- “~ ~~~~~’ posure to TV advertisements for the prodDemographics Frequency Percent* uct purchased as well as similar products; Ettinicity ^^’^ amount of thought given to the TV White 676 78,0 purchase, “”Maori descent 132 15,2 ^°’ example, whether the purchase was an impulse or planned decision was meaPacific isiand descent 19 2,2 j u ..u -^ /-^ u J U sured by the item To what degree would ,,,,?,’?,’,’?,?^^^,9,!,’^,^,^f^,^,’,^,?, ?:?, 3.:h you say your decision to purchase was Other 22 2,5 planned in advance?” (1 = Not at all—just Totai sampie size 878 100,0 ^ ^P”‘^ °^ * e moment impulse, 5 = Very much—had planned to buy the next time ‘Percentages based on totats of each characteristic. I saw the advertisement).

 

Likewise, predisposition toward purchasing a product exposed to stimuli that suggests a need is conducted in three waves over a three- similar to that advertised included quessatisfied through purchase, month period. The products were adver- tions such as: “I had seen TV ads for other tised during approximately 25 hours of products like this before,” and “I had been METHOD TV time purchased per week. We devel- looking around for a product like this, oped a database of 878 purchasers re- even before I saw the TV ad,” PreSample sponding to our mail survey, which rep- purchase thinking included questions The data used in this study was collected resents a response rate of 32,8 percent, A such as: “I thought a lot about the infowith the cooperation of the New Zealand profile of the sample is presented in Table mercial before 1 decided to buy,” and “Bedivision of a major international infomer- 1, This was a tradeoff between more ques- fore I decided I thought a lot about whethcial marketer.

 

New Zealand represents a tions and therefore more information with er I might benefit from the product,” microcosm of 3,8 million consumers who a slightly lower response rate; 30 percent Perceptions of advertising effectiveness are often used as a test market for launch- has been noted as a reasonable response related to seven items such as “I found the ing new products by global marketers rate to expect (Cooper and Fmory, 1995), infomercial interesting and informative,” (e,g,. Reader’s Digest). and “The demonstrations of how the Infomercials are programmed in off- product worked were very helpful in peak times, usually mid-morning and Survey instrument making my decision to buy,” Respondents after midnight.

 

Virtually all of these are The survey consisted of questions cover- were asked to indicate degree of agreeproduced for the American market with ing the type of purchase decision, as well ment with statements related to the above the only modification for the New as factors that influence this decision, measured by a 5-point scale with anchors Zealand market being price and ordering areas that we believe break new ground in 1 = agree strongly and 5 = disagree information, infomercial research. The survey package strongly.

 

We surveyed 2,670 people who had consisted of a cover letter, a prize draw purchased a product from an infomercial incentive, the questionnaire, and postagewithin the previous two weeks. Six prod- paid reply envelope, A follow-up mailing ucts were surveyed: three exercise devices with an additional survey was sent including a strider for aerobic fitness, a approximately two weeks later with rider providing resistance for major an additional prize draw opportunity to muscle groups, and an exerciser to reduce improve response.

 

The sections of the the buttock area; a facial cream; a chil- survey relevant to degree of planning dren’s reading program; and a memory- consisted of questions relating to the folimprovement course. The research was lowing: the degree of planning given to Anaiysis Two different analyses were conducted on the data. First, factor analysis was performed to assess the underlying dimensionality of scale items; this allowed indices to be created for constructs measured by multiple items.

 

Second, a multiple regression was used to determine what factors influenced whether an infomercial purchase was planned or made on impulse. The criterion variable here was the extent to which a decision was a planned or impulse decision. The results of these analyses and the independent variables used in the regression analysis will now be presented, RESULTS Factor anaiysis The principal components analysis generated six indices: advertising effectiveness (Cronbach’s alpha = ,79); comments and demonstrations (a = ,74); payment information (a = ,64); recognition, comparison, and extras (a = ,56); previous interest in the product index (a = ,63); and a prepurchase thinking index (a = ,83), These are displayed in Table 2, Overall, these indices demonstrate adequate reliability with only the “recognition, comparison, and extras” factor falling below a coefficient of ,60 (cf, Malhotra, 1993), yet it is still above the ,50 guideline of Guilford (1954),

Research Question 1: Infomercial purchases—planned or impulse? In response to being asked to what degree respondents felt their infomercial purchase was planned in advance, where 1 = impulse decision and 5 = very planned decision, the results indicated that purchases were somewhat planned (Mean = 3,66, standard deviation = 1,43), Only 13 percent of respondents considered their purchase a spur of the moment decision. On the other hand, 65 percent believed that some planning had gone into the purchase decision, with 38,9 percent of the total number of respondents rating their decision as very much planned.

Research Question 2: What factors influence whether a purchase is planned or impulse? The results for the multiple regression are displayed in Table 3, The regression model was significant (p < ,001) with 27 percent of the data explained by the model (Adjusted R-square = ,27), Two variables had a statistically significant positive association with the extent to which a decision was planned or impulse (1 = impulse decision, 5 = very planned decision).

 

The first was prior exposure to the advertisement (r = ,26, p < ,001), As prior exposure was a dummy variable for the question “Had you seen the infomercial before for the product you just bought?” (0 = no, 1 = yes), this result indicates that a “yes” response (i,e,, prior exposure) was more indicative of a planned decision rather than an impulse one. Presumably, impulse buyers are more likely to purchase upon first exposure, when they react to the “impulse” to purchase (Rook, 1987), Planned infomercial purchasers are more likely to have viewed the infomercial on previous occasions before committing themselves to the actual purchase of the advertised product.

 

To further investigate this result we reduced the dataset to those buyers who had answered “yes” for prior exposure (i,e,, they had seen the infomercial before). We then ran a correlation between their planned/impulse dependent variable scores (1 = impulse decision, 5 = very planned decision) and the number of times these consumers had seen the advertisement (1 = seen once, 4 = 4 times or more). Not surprisingly, this revealed a significant positive association (r = ,18, p < ,001) which suggests that planned decisions are associated with having seen the infomercial advertising that product numerous times.

 

In other words, the more often the infomercial is seen, the more planned the final decision purchase is likely to be. The second variable positively correlated with whether a decision was planned or impulse was children aged 10 to 14 years (r = ,10, p < ,05), This indicates that if infomercial buyers have children in their household aged between 10 and 14 years old the purchase decision is likely to be more planned. Buyers with children of this age are less likely to make an impulse purchase in response to seeing an infomercial.

 

Variables with significant negative associations with planned/impulse decisions were: Comments and demonstrations (p < ,01); previous interest in the product (p < ,05); prepurchase thinking (p < ,001); and amount of infomercial viewing (p < ,05), For comments and demonstrations this result shows that the more important that infomercial buyers rate customer testimonials, expert comments, and demonstrations shown in the advertising (1 = very important, 5 = not important at all), the more likely they are to make a planned purchase rather than an impulse one. For previous interest in the product, planned decisions were associated with higher levels of previous interest in the product advertised.

 

Buyers here are more likely to have been looking around for a product of this type before they saw the infomercial and thus are more planned and considered in their infomercial purchase. For prepurchase thinking, the more buyers think about the content of the informercial they have seen, the more likely they are to make a planned decision. This indicates that consumers who are stimulated to think by the infomercial are less likely to make impulse purchases. For the amount of infomercial viewing (0 = more than once a week, 1 = once a week or less), this negative correlation suggests that the fewer infomercials a consumer watches, the more likely that person is to make an impulse purchase.

Conversely, people who watch infomercials more than once a week, are more planned in their purchase decisions. . . . infomercial purchases are not always the impulse decisions that we might expect. Overall, purchases are rather planned.

DiSCUSSiON This study has found that infomercial purchases are not always the impulse deci- ^^^^^ ^f^^^ ^^^^^ ^^^ infomercial several sions that we might expect. Overall, pur- ^-^^^ Importantly, we uncovered some chases are rather planned. In this study, yggf^j findings for what factors influence pure impulse purchases represented the whether an infomercial purchase is a minority (or 13 percent) of total purchases, planned or an impulse decision.

 

Most were planned, at least to some ex- j ^ ^^^^^ ^j the factors that influence whether an infomercial purchase decision is planned or impulsive, the results suggest that consumers are more likely to “O^t ‘ ‘ make impulse purchases whether they are Multiple Regression Results infrequent viewers of infomercials. This suggests that it is the infrequent viewer of informercials who is most susceptible to making an impulse purchase. In contrast, Variabie Beta , . j ^ u more frequent viewers tend to be more Infomercial Elements likely to make planned decisions that ,,,,,9°^,’???i:’H,?^??,,R?,’?]?!?,?*!;?*!°’:i?,,,,:;,^?,’, are often associated with seeing the infoConsumer Ctiaracteristics mercial a number of times. Previous interest in product -,09” Interestingly, impulse purchasers often Prepurchase thinking -,24″^ have lower levels of previous interest in Prior exposure to ad’ “26^ * ^ P”°^”‘^* ^^ ^ ”” ^ *=^” P^^””^”^ P””- chasers.

 

This suggests that for impulse Amount of Infomercial viewing -,10^ , . , ,° buyers, infomercials succeed in making Demographics consumers aware of a product, convincing ,,,,,9!:’,’,’,^’?,”,,,l,!^^iy?,^’!, ;,^?.! them of their need for this product, and Diagnostics securing a purchase. Likewise, impulse R-Square 31 buyers, having seen the infomercial, are , ., ^ , ,, „-, less likely to engage in prepurchase Adjusted R-square ,27 / o o r r thinking whereby they contemplate the Standard error of estimate 1,21 -^ r ..u ,. ,. J • .u merits of the arguments presented in the ,’?!^,*i’!]:yy^H?r’,,^!^,?^i?!;’,*;^, h^ l infomercial.

 

Overall then, impulse buyers. Note: Variables include advertising effectiveness, payment relative to planned buyers, have seen the information, recognition, comparison and extras, prior pur- infomercial fewer times before purchase, chasin<^ usini^ infomercials, prior purchasing using regular TV ads, prior purchasing using mail-order catalogs^pay- ^^””^ ^^^^ previous interest in the product, ment method, product type, and the demographics—age, and think leSS about the merits of the adeducation, ethnicity, gender, income, marital status, chil- ^ertising before purchase. These findings dren in the household under 2 years, 2-5 years, 5-9 years, ^J i u and 15-20 years. The table includes only those variabtes would appear to implicitly Support the litxoith significant standardized beta coefficients. erature on impulse buying.

 

For instance, “Beta significant at p< .05 „ , .. , , ‘•Beta significant at p < ,01 ^eatty and Ferrell (1998) assert that im- ‘Beta significant at p< .001 pulse purchases tend to be spontaneous 4 0 JGDRRHL DF RGDERTISIRG RESERRCR November . December 200 1 and are acted upon without a lot of reflection or prepurchase intentions. Since planned buyers have a greater interest in the product before even seeing the infomercial, these consumers may have higher levels of intrinsic involvement with the product (Celsi and Olson, 1988), Owing to this higher natural interest, planned buyers may have more extensive evaluative criteria and information needs than impulse buyers.

 

The decision requires greater thought and evaluation than it does for an impulse buyer. Consequently, planned purchasers find demonstrations of product performance and expert comments more important, presumably as part of their more analytical assessment of the message’s argument quality (Laczniak and Muehling, 1993), This represents a useful avenue for future research. Furthermore, given that planned buyers have seen the infomercial more often it would be of interest to study how best to repeat infomercials to generate sales.

 

For example, do more purchases result from planned buyers viewing the same infomercial repetitively on one occasion (e,g, seeing the advertisement three times in a row) or from viewing that infomercial once each day over subsequent days? Consumers with children aged between 10 and 14 years of age also tended to make more planned decisions. One could argue that with a limited budget and less disposable income, or at least compromises that had to be reached in household expenditure, these consumers were more considered in their approach to purchasing.

 

Whether this was because of a sense of fiscal responsibility, or whether the views of family members were sought in approving the purchase (Beatty and Talpade, 1994; ChUders and Rao, 1992) is an interesting avenue for further research. Factors that had no influence on the extent of planning included: the type of product advertised, the payment information displayed, the effectiveness of the advertising, whether the consumer had purchased from an infomercial, TV advertisement, or mail-order catalog before, and the method by which consumers paid for their products. Likewise, demographic variables did not influence consumers, with the exception of the aforementioned age of children in the household. Of some surprise is that infomercial elements that appear to be employed often, such as endorsement by recognizable spokespeople (Ohanian, 1991), product comparisons (Neiman, 1987), and offering additional items in the infomercial, while involving the viewer or enhancing the selling proposition, did not seem to influence the nature of the decision,

 

CONCLUSION

This article suggests that it might be dangerous for marketers to overrate the persuasive power of the infomercial as a device that prompts mainly an impulse purchase. Our study shows that many purchases may be categorized as somewhat planned, especially if the consumer has viewed the advertising several times. Importantly, the present study shows that impulse purchasers are characterized by viewing infomercials less frequently than planned purchasers, having seen the infomercial for the product less often, and also thinking less about the reasons for purchase provided in the infomercial.

 

TOM AGEE is a senior iecturer of marketing at the University of Auckland, New Zealand, He established the country’s first degree in advertising in 1994 while Head of the School of Marketing and Advertising at the Auckland University of Technology. He has more than 25 years experience in virtually every facet of advertising, having worked with agencies both in New Zealand and the United States, where he was a founding partner of Finnegan & Agee, Richmond, Virginia, He actively consults on marketing communication issues with national advertisers and government departments,

BBETT A. S, MARTIN is a senior lecturer of marketing at the University of Auckland, New Zealand, He received his Ph,D, in marketing from the University of Otago, His teaching interests include consumer behavior, marketing strategy, and e-commerce. His research has been published in journals and books such as the European Journal of Marketing, Marketing Intelligence and Planning, and the Australasian Marketing Journal.

 

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