How does drinking a caffeinated beverage influence shopping behavior? Are customers prone to impulsive purchases after consuming coffee, tea, or soda at retail stores or car dealerships?
We explore these questions in a new Journal of Marketing study and find that drinking a caffeinated beverage before shopping leads to more items purchased at the store and increased spending. Our studies also show that the effect of caffeine is stronger for “high hedonic” products such as scented candles, fragrances, décor items, and massagers and weaker for “low hedonic” products such as notebooks, kitchen utensils, and storage baskets.
This shopping behavior is further facilitated by stores such as New Seasons Market and Trader Joe’s, as well as many Mercedes dealerships, which provide customers with complimentary caffeinated coffee. Other stores such as Target and Barnes & Noble house coffee bars where consumers can purchase coffee, tea, or other caffeinated drinks. Of late, large chain stores and small boutiques are using in-store coffee bars to differentiate themselves from online retailers.
Understanding how and why caffeine consumption influences spending is important since caffeine is one of the most powerful stimulants that is both legal and widely available. About 85% of Americans consume at least one caffeinated beverage every day, with coffee being the primary source of caffeine followed by tea and soda. Caffeine is also found in energy drinks, chocolate, and in many over-the-counter and prescription medications.
Several studies have demonstrated that caffeine intake enhances arousal, which is experienced as a state of activation and alertness that can range from extreme drowsiness to extreme excitement. Arousal can be a positive hedonic state – referred to as excitement or energetic arousal – such as when one feels active, energized, and excited, or a negative hedonic state – referred to as “tense arousal” – such as when one experiences tension and nervousness. Energetic arousal enhances the perception of product features and, in turn, increases purchase intentions for hedonic products such as buttery, salty popcorn, chocolate candy, and luxury vacations.
Prior research has shown that consuming caffeine in the range of 25 mg to 200 mg enhances energetic arousal with practically no effects on tense arousal. We examine effects of caffeine intake in the range of about 30 mg to 100 mg since most caffeinated beverage servings have caffeine content in this range. As part of our studies, we set up an espresso station near the entrance of a retail store in a major city in France and outside a department store in Spain. Upon entry, half of the 300 shoppers were handed a complimentary cup of coffee containing caffeine, and the other half offered decaf or water. We found that the first group spent about 50% more money and bought nearly 30% more items than those who drank decaf or water.
We also find that caffeine impacted the types of items bought at the stores. The group that took in caffeine bought more nonessential items such as scented candles and fragrances. However, there was very little difference between the two groups with regard to utilitarian purchases such as utensils and storage baskets. Also, the effects of caffeine on spending hold for those who drink two cups of coffee (or less) daily and is attenuated for heavy coffee drinkers.
Overall, we conclude that retailers can benefit financially if shoppers consume caffeine before or during shopping and that the effects are stronger for high hedonic products. This is important for retailers to factor in to determine the proportion of hedonic products in their stores. Policy makers may also want to inform consumers about the potential effects of caffeine on spending.
Our research can be extended in several directions. Can arousing elements such as loud music influence the effects of caffeine on shopping behavior? It is possible that high levels of arousal induced by a combination of caffeine and ambient elements can alter shopping behavior. What if shoppers consume coffee along with some food like chocolate cake? Several interesting findings could emerge from research involving caffeine and these variables.
From: Dipayan Biswas, Patrick Hartmann, Martin Eisend, Courtney Szocs, Bruna Jochims, Vanessa Apaolaza, Erik Hermann, Cristina M. López, and Adilson Borges, “Caffeine’s Effects on Consumer Spending,” Journal of Marketing.
Dipayan Biswas is Frank Harvey Endowed Professor of Marketing, University of South Florida, USA.
Patrick Hartmann is Associate Professor of Marketing, University of the Basque Country UPV/EHU, Spain.
Martin Eisend is Professor, Marketing Department, European University Viadrina, Germany.
Courtney Szocs is Associate Professor of Marketing, Louisiana State University, USA.
Bruna Jochims is Assistant Professor of Marketing, SKEMA Business School, France.
Vanessa Apaolaza is Associate Professor of Marketing, University of the Basque Country UPV/EHU, Spain.
Erik Hermann is Senior Manager (Marketing & Investor Relations), Deutsche Payment, Germany.
Cristina M. López is Assistant Professor of Marketing, University of the Basque Country UPV/EHU, Spain.
Adilson Borges is IRC Professor of Marketing, Neoma Business School, France.