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TITLE: THE EFFECT OF DISCOUNT OFFERINGS ON

CONSUMERS- AN EYE TRACKING STUDY ON DISCOUNT


ADS

Submitted by: Group 14 – Marketing B -SIBM PUNE 2019-21

Manvi Chawla 42214 manvi.chawla21@associates.sibmpune.edu.in


Mihir Belgaonkar 42219 mihir.belgaonkar21@associates.sibmpune.edu.in
Nishitha Gangu 42230 nishitha.gangu21@associates.sibmpune.edu.in
Twinkle Pajiyar 42235 twinkle.pajiyar21@associates.sibmpune.edu.in
Vedantsing Pardeshi 42236 vedantsing.pardeshi21@associates.sibmpune.edu.in
Shelina Dharani 42278 shelina.dharani21@associates.sibmpune.edu.in

Submitted to Prof. Preetha Menon

ABSTRACT

In recent times the average customer span is shrinking. Many companies communicate their
offerings: products and services through print ads and ads on digital platforms. These
advertisements have a significant influence on communication factors concerning the advantages
of purchasing a product or hiring a service. And hence it is important to know on what areas do
the customers focus the most when shown an advertisement. Understanding the variables that
affect consumer behavior is of utmost importance to find the key areas of marketing studies. This
research studies the variables that affect the consumer’s purchase decision when shown an
advertisement can be the discount, price or texts. Firstly, an eye tracking study was executed by
conducting lab experiments using image of ten discount ads by various companies with 10
participants to capture quantitative elements like Time to fixation, fixation duration, fixation
count. This is then followed by a survey to corroborate the findings from the eye tracking data.
Findings reveal that text is the least important component and Image and discount offerings
capture the sight of the customer.
INTRODUCTION
A price discount is a prevalent marketing strategy to attract consumers by providing an extra
value or incentive, which encourages consumers to purchase the promoted products immediately.
Many companies communicate their offerings: products and services through print ads and ads
on digital platforms. These advertisements have a significant influence on communication factors
concerning the advantages of purchasing a product or hiring a service. And hence it is important
to know on what areas do the customers focus the most when shown an advertisement.
Understanding the factors that influence shopper’s decision-making process is of most extreme
significance to locate the key areas of marketing studies. Among the variables that affect the
consumer’s purchase decision when shown an advertisement can be the discount, price or texts.
This research aims to evaluate the consumer’s buying behavior when different patterns of
discounts are offered by the companies.
LITERATURE REVIEW
Sales promotion is an initiative that attracts customers with the help of monetary and non-
monetary incentives. It is a promotional strategy where high market similarity exists, and it
helps in brand switching. It also influences consumers for stockpiling because offers motivate
customers to buy extras (Kotler, Keller, 2017)1.
An advertisement is considered
effective if it attracts the customer’s attention, has a memorable impact on the customer, stimulate
the customer’s
purchase intentions, and affect the customer’s emotions (Adibi, 2012). According to
Ramalingam et al. (2006), an
effective advertisement has two main characteristics. First, advertiser should satisfy consumer’s
objectives by engaging
the customer in the product/service experience and by delivering a relevant advertising message
to the customer. Second,
advertisements must be consistent with the objectives of the advertiser.
If an advertisement attracts the customer’s attention, stimulate its purchase intentions and has a
memorable impact on its mind only then the advertisement is considered effective (Adibi,2012)2.
Compared with text in the advertisement, image has some unique advantages: it is more
attractive than plain text, and it has been found to be more salient than text , thus it can grab
users’ attention instantly; it carries more information that can be comprehended more quickly,
just like an old saying, a picture is worth thousands of words; and it can be shown to the users
faster than video. As a result, image has become one of the most pervasive media formats on the
Internet (L. Kennedy, 2007)3.
“Buy one get one free” is one of the promotional techniques in which the customer is offered an
additional product at normal price but with greater enhanced package. This persuades the
customer to purchase the produce because there is no requirement of any additional price (Sinha
& Smith, 2000)4.
Price discount is another tool for offering a reduction in prices, which is openly mentioned on the
product or point of purchase display (Fill, 2002)5. The customers are more attracted to price-off
promotions as compared to the other techniques (Percy et al., 2001)6.
Another promotional technique is-Sampling, in which a real or trial-sized product is sent to
customers. Free samples of product are given to consumers so that consumers have an
opportunity to try and utilize the products. It helps customers checking out the produce and
purchasing the product in near future (Pramataris et al., 2001)7.
A limited-time offer is also used in advertisements which provides any kind of discount, deal,
special gift, or reward a buyer can get if they make a purchase during a certain time period.
Retailers use limited time offer ads to get people to buy their products. Offers available for a
limited time only are a great way to draw people in, create a sense of urgency, and get them to
convert.

CONCEPTUAL FRAMEWORK

Price discount is a very important technique used by marketers to attract prospective consumers
to purchase their products. But what exactly causes consumers to respond to the discount’s
stimulus? Research has shown that when we look at the direct impact of price discount with
quality, consumers perceive highly discounted products as being of a lower quality. But when
price discount is a mediator, it creates positive perception of product quality in the consumer’s
mind.8
According to work done by Darke and Dahl 2003; Dorzdenko and Jensen 2005; Kocas and
Bohlmann 2008). Raghubir et al. (2004), promotional effects are three-fold, namely (a)
economic, (b) informational, and (c) affective. They argued that the final effect of a price
promotion on purchasing decision is a combination of positive and negative economic,
informational, and affective influences.
Economic effects of price discounts are created by a monetary gain or non-monetary (e.g., time
and effort) gain or loss from a price promotion provided to customers. Perception of quality can
be termed as an informational impact of price discounts. Affective effects relate to mood,
perceptions or emotions. Thus, the joy of bagging a good discount offer or the fear of missing
out on an attractive discount offer are examples of affective effect.
Additionally, how the price discounts are put forth in the advertisements are also bound to
influence the consumer purchasing them. That is, the semantics of price discounts are equally
important. So, usage of words such as “Bumper”, “Super Saver”, “Mega Discounts” is impactful.
Research has shown that some semantic claims lead the consumer to consistent numerical
interpretations of those claims. Furthermore, a subset of those claims was found to influence
discount expectations and perceptions of both transaction and acquisition value. This shows us
that it makes sense to look at where the words and numbers in the advertisements are displayed,
to lure in customers to buy respond to price promotions.9
Thus, with research informing us that price discounts do have an effect on consumer desire to
buy, and knowing that the semantics of price discount communication being equally relevant, it
now makes sense to map where the consumers usually look at, and for how long, when such
marketing communication is displayed in front of them. This motivated the team to work
towards performing an eye-tracking study on marketing collaterals, to delve further into where
exactly the consumers are drawn towards.

STUDY OBJECTIVES
i. This study aims to gauge the consumer focus on images, texts and discounts in an
advertisement by measuring how much consumer are attracted towards the ad first (Time
to first fixation) ,time consumer spends on seeing images, texts and discounts in the
advertisements(The Total fixation duration), Fixation Count
ii. This study also directs us how to improve the areas which we want our consumers to
notice
iii. To recommend a strategy for designing promotional advertisements for the companies.
iv. To gain better consumer insights by interviewing them and mapping them with eye
tracking results

METHODOLOGY

This study was executed by conducting lab experiments using image of discount ads by various
companies and Tobii Dynavox Eye Tracker. The study used eye tracker to capture different
advertising metrics. Also, consumers were interviewed to gain insights as well. This data was
further analyzed and corroborated.
For the experiment, a total of 10 participants were included in the study. There ages ranged from
22-27 years (average age = 24.5), with an experience in browsing the internet for various
shopping related discounts. The interviews of the same 10 participants were taken to better
understand the data collected through the eye tracker study and other metrics like colour used in
the image, text, size of text, vibrancy of the image, price sensitivity, celebrity endorsements, etc.
Recruitment of the participants was done through word of mouth where the participants were
willing to take part in the experiment.

PRE-EXPERIMENT SETUP

A Pre-Experiment setup was made by collecting 10 ads from various consumer brands from the
mentioned industries having discount offers in them. Also, the setup for Eye-Tracking study had
to be done wherein Tobii Eye Tracker device was attached to the lab desktop. The ads were
imported into the Tobii Software where multiple settings like the duration of ads, order of ads,
pause time etc. were set before starting the experiment.

EXPERIMENT USING EYE TRACKER

Before starting the experiment, each participant was asked to input their information into the
software. They were then asked to relax and a focus calibration was done in order to track the
eye movement for each participant wherein they were asked to remove spectacles, not blink,
adjust the distance between the eyes and the screen and focus on the moving dot on the screen.
The participants were then showed ads from the following industries: food, e-commerce,
electronics, offline retail stores where the main purpose of the ad was to showcase the discounts
offered. These ads were shown to the participants in a random order.
After all the ten respondents viewed the ads, the software generated various reports and metrics
like-Heat maps, Gaze maps, Time to first fixation, First fixation duration, Total fixation duration
etc. These metrics were then analyzed to understand what factors influenced buying behaviors.
This analysis helped us to understand customer focus point in the ads shown, making
recommendations as to what can be made better in the advertisement’s basis the preferences of
the consumers.

FINDINGS
Following are the findings from our study.
STATISTICS
From the Table 1, it is evident that the image is an attention seeker. The users are attracted
towards the image first as the (Time to first fixation) is the least for the image then they move on
to the offers mentioned and then finally to the other textual matter. However, (The Total fixation
duration) is the highest for the Discount Offers. The users spend more time analyzing the
Discount Offers.

Table 1: Mean and Total sum of Time of fixation, duration and total visit duration

HEAT MAPS & GAZE PLOTS

Below are the attached heat maps and gaze plots of few of the images on which the study is
conducted all other images and data related to the study are attached in the folder. It is evident
that consumer users spend more time analyzing the Discount Offers.
Figure 1 is of, of a leading mobile company One Plus offering discounts to its customers on an
e-commerce website-Amazon. It offers some discount on its flagship product which is written in
small font on the right-hand side and the product image is placed on the left. Through our
analysis what we see is that consumers spend more time on the textual information than the
image of the mobile phone. General hypothesis that we create around this is that the picture of a
mobile phone is something that the users will pay less attention to as it is quite generic. The
image is an attention seeker. The users are attracted towards the image first as the (Time to first
fixation) is the least for the image then they move on to the offers mentioned and then finally to
the other textual matter. However, (The Total fixation duration) is the highest for the Discount
Offers. The users spend more time analyzing the Discount Offers.
Figure 2 is the heat an gaze plot of Zomato advertisement which is shown to the participants to
understand what attracts them in an advertisement. We studied an Advertisement of a food
delivery partner ‘Zomato’, as per our study we found that most participants looked at the image
in the first few micro secs (time to first fixation was the lowest), which shows that the
participants were attracted to images; majority of the participants also spent most of the time
looking
at the image (total fixation time was the highest), which shows that the image didn’t only
capture the attention of the audience but also for the longest time period; the image also had the
highest fixation count, which means the participants kept looking at the image again and again
and then focused on the brand and gave least priority to the offer; almost all participants first
looked at the image on the poster when they were asked to stare at the advertisement (total
number of fixations before the image is zero), this shows that the image was the first thing that
attracted people in the Advertisement

Figure 1. Heat and Gaze plot of One Plus Advertisement


Figure 2. Heat and Gaze plot of Zomato Advertisement
The tests reveal that the Brand name of the company, the discount mentioned, and the image
displayed catch the most attention of the users. The image is the most important component as
the user takes the least time to reach the image (Time to First Fixation) of the food but the time
spent on the food image (Total Fixation Duration) is the highest and hence the total Fixation
Count the user stayed on the image is also the highest. Also, we can see that the Fixations Before
the user reached the image of food are less which means the user reaches the food image Figure
3 in minimum time and fixates at the image for the maximum time in the entire duration of the
advertisement. Also, from the data we can see that, after the image, the discount offer being the
second and the brand name being the third most important component based on the same
variables as above. Text is the least important component

Figure 3. Heat and Gaze plot of Burger Advertisement

RESULTS FROM IN-DEPTH INTERVIEWS


Respondents were asked questions about what they noticed from each of the ads and what they
remembered. Most of them remembered images more than text. When asked what they wanted to
see more if more time was given then they responded they wish to know more about the discount
offered. These responses are in line with the trends observed through eye-tracking study.

CONSUMER INSIGHTS
The advertisement strategy also changes depending on the type of industry. In food based
advertisements, the image is important. For electronics companies like mobile phones, the
customer focus shifts a bit towards the other details like specifications.

DISCUSSION
The study was conducted to understand the consumer mindset, what attracts consumers to the
different advertisements and what captures majority of their attention span while looking at
different advertisements.
The study included advertisements of different offerings ranging from low cost products like
food items (burger) to high end consumer goods like mobile phone to see how what attracts
consumers in different advertisements.
The study was conducted by tracking eye movements of participants and the following things
were studied:
1. Time to first fixation- which is the time take by participants to focus on different aspects
of the advertisement (images, text, discount details, brand, etc.)
2. Total fixation time- this is total time spent by participants focusing on aspects of the
advertisement (image, text, discount details, brand etc.)
3. Fixation count- this is the number of times the participants focused on the aspects of the
advertisement (image, text, discount details, brand etc.)
The eyeball tracking was done along with in-depth interviews with the participants regarding
what they noticed from each of the advertisements and what they remembered.
The results were then combined to see what really caught the attention of consumer in the
advertisement and what they remembered about the advertisement. A similar pattern was
observed in the eyeball tracking movement for products in the low-priced category and a similar
pattern was observed in the high-priced product category. The categories showed the following
patterns:

LOW PRICED OFFERINGS


People focused more on the image for low end consumer products like burger. Most participants
had the lowest time to first fixation for images in this product category, i.e. people immediately
looked at the image when they were asked to focus on the advertisement; most participants also
had the highest fixation count and highest fixation duration for the image in the advertisement,
hence emphasizing that people did not only look at the image first but also spent most of the
time looking at the image displayed by repeatedly focusing on the image.
HIGH PRICED OFFERINGS
Most participants had the lowest time to first fixation for images in this product category too, i.e.
the image was the first thing that caught people’s attention they then move on to the offers
mentioned and then finally to the other textual matter. However, The Total fixation duration is
the highest for the Discount Offers. This shows that users spend more time analyzing the
Discount Offers than looking at the image example advertisement of mobile phone (One Plus).
CONCLUSION
By categorizing products into two categories based on their price, the study shows that buyers
react differently to advertisements based on their price. The eyeball tracking study revealed that
the consumer focuses on the image in the advertisement rather than the discount being offered or
the brand; whereas with high priced products, the consumer does get attracted to the image being
displayed which captures the initial attention but then the consumer focuses on the discount
being offered, price, brand and other details.
As a conclusion it can be said that consumers are price sensitive, i.e. while spending on products
of lesser value they do not focus so much on the discount but with items that are costlier they
focus on discounts with the intention to get the best deal.
LIMITATIONS
This study is a laboratory experiment and may suffer from its usual shortcomings. For case,
subjects may be restrained in their reactions because they are mindful that they are in a research
process. Future research can consider this shortcoming and work on it while designing the study.
This study has randomly assigned subjects to each group thus not considering the effect of
gender or age on the outcome variables. Future studies can group subjects based on these
variables to study their effect.

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