Purchase planning

Purchase planning is the decision to purchase a product and service in the future. The dominant model for explaining behavioral intent and understanding purchase planning is the theory of planned behavior.⁶¹ The stronger the intention, the higher the likelihood that an individual will act, especially if the individual has control over the act as such.⁶² In addition, external factors influence whether or not an act is carried out, depending on the actual or perceived availability of the necessary resources, such as money, tune or capacity.⁶³

Scarcity of time can reduce both planned and unplanned purchases.⁶⁴ Frequent shoppers and customers, who are more familiar with the design of a point of purchase, make fewer unplanned purchases.⁶⁵ The key in the theory of planned behavior is the subjective norm, which describes the social environment in which the individual acts, his opinion about the expected future action and his perception if a specific action is accepted and reaffirmed.⁶⁶ Obstacles, internal and external, e.g. money and time, are interpreted subjectively.⁶⁷ The perception of the impact of the potential intended action influences the behavior. Closer to the purchase possible negative aspects about the purchase gain in importance.⁶⁸ Studies show an association between intention and behavior in grocery shopping,⁶⁹ customer retention,⁷⁰ technology acceptance,⁷¹ mobile marketing and e-commerce.⁷²

The theory of planned behavior can predict observable behavior, bitt it does not show the process of transforming intention into action.⁷³ Neither does it explicitly include spontaneous impulse behavior when there is no prior intention to act.⁷⁴ However, past behavior is a strong predictive factor of future behavior, especially spontaneous behavior, repeated or under time pressure.⁷⁵ Shoppers adapt their purchase process, choice of brands and volumes to their experience with the point of purchase.⁷⁶

There is a clear distinction between planned and impulse purchases. Normally, there is a correlation between the involvement level and the planning. The higher the involvement the higher the planning. Buying real estate, which normally has a high involvement due to its financial and social implications (location, size, type), is normally well planned and prepared, with financing calculations and in-depth evaluations of different factors. A purchase of cookies or other snacks on the way to work or school is a purchase with a lower involvement. It may have a high situational involvement dining the purchase situation, and may have a high or low level of planning. If it is a routine purchase, in which a snack and the same brand are bought frequently, then it would be a planned purchase, but of low involvement. It can also be an impulse purchase where the shopper sees a product that he or she craves and therefore buys. In the end, the risk of failure is very small and new products can be tested, repeatedly. Although there is some planning, preparation is minimal. Clearly, there are cases with high involvement and a high level of planning where there is a last-minute

Figure 3.10 The theoiy of planned behavior

Behavior is associated with the intention to act, as well as the attitude toward the intention, the behavior, and the subjective norm (describing the individual’s social environment and opinion about the intended behavior), as well as the perceived control over the intended behavior. In addition, different background factors influence attitude, norm and perceived control.

Source: Based on Ajzen, 2005

change of plans caused by triggers or information at the time of purchase that were not known before. For example, a car salesperson might offer a better deal on a model that the shopper prefers but would otherwise have been beyond his financial budget. It does not have to be a direct discount, but can be an offer of attributes that improve the cost of ownership. In the case of a car, these could be a warranty, maintenance, extras, or a color or sound system upgrade, for example. In this situation, the purchase and type of product were planned, and due to additional information, there was a change to the planning in terms of the product type, but not the category as such.

The flexibility of the planning depends on the level of involvement and preparation. The example of real estate is normally a case of almost complete planning, with some room for price negotiation, while in the case of a car purchase more attributes can be added to the decision set. Although the purchase of cookies can be planned, it can most probably be quite flexible to new offers and brands.

Two key aspects of planning are the timing of the purchase, and what is being planned. The closer to the purchase, more and more dimensions may be planned, but also the opposite is possible. A shopper may desire a specific product and service, and then, while evaluating different dimensions and attributes, decides on an alternative.

The dimensions being planned can be quite general and refer to the solution to the consumption need state in broad terms. For example, going to the store with the general plan to shop for the family dinner. A more specific planning could be to cook an Italian dinner. In addition, if more planned, a detailed list of the ingredients could have been prepared. Also, the shopper can have an idea of the budget for the dinner. This budget can be related to the total purchase or to specific categories.

The shopper can plan the solution, category, brand or a specific product and service, and write it down in his mental or real shopping list. The level of planning depends on the detail of attributes being planned. Depending on what was planned there are different implications on the activation, and if the solution in general, the category, brands or specific products and services have to be activated. The planning drives the decision process and guides the activation logic within the shopper journey. The planning process and the activation begin before the point of purchase and have to be managed throughout the shopper journey. Often, closer to the purchase the decision triggers become more related to price and promotions.

With high involvement products and services, managing the planning process usually becomes more complex, as the shopper and the consumer are more informed and use more touchpoints. Manufacturers will try to increase the involvement with their products and services to include them in the planning process and decision set of the shopper. The more the touchpoints are outside the control or influence of the manufacturer the more challenging the task becomes.

The more planned different aspects of the purchase are, the more organized the shopping mission. Buying real estate will rarely be an emergency shopping mission, while this could very well be the case when preparing dinner, e.g. if an important ingr edient is missing.