Consumers who partake in the art of "cherry picking," or only buying items that are on sale, are not as dangerous to retailers as previously thought.
According to a recent study by associate professor of marketing, Debabrata Talukdar, though shoppers get a large percentage of discounts, it does not take a master cherry picker to find deals at the market.
"People who are extreme cherry pickers only get about 75 percent of the total discounts, but we also found that people who weren't actively seeking sales got about 50 percent of discounts," Talukdar said.
According to Talukdar, people who contribute negatively to a store's profit are considered cherry pickers. They consume items that are loss leaders for the store, such as milk. These types of products are offered at lower prices to lure shoppers into stores, and retailers hope that once in the store, they will also consume non-sale items.
"Over a year, they (cherry pickers) only consume negative profit items," he said.
Contrary to the suspicions of major grocery retailers in Buffalo, cherry pickers are not a large percentage of their customer base, according to Talukdar's research. He estimates that only about 10 to 15 percent of shoppers fit into the cherry picker category.
This study was based in the Buffalo area and compared two of the most prominent grocery retailers in the area, which Talukdar declined to name. He and his colleagues used these grocery chains to track the purchasing patterns of shoppers, which in this area, includes many students.
Nicole Capodaglia, sophomore mathematics major, is a shopper who watches the sales in order to save money.
"I will wait until its on sale if I want an item. I like to save my money," she said.
However, Fatima Clarke, freshman nursing major, does not mind shelling out a few more dollars for the essentials.
"Anything I need like hygiene products, some clothes like jeans and sneakers, and that's about it," she said.
There is much speculation as to the extent of damage cherry pickers like Capodaglia cause to the grocery industry, as they only allow for a small profit margin of about two percent, according to Talukdar.
While selling negative profit items is a necessary evil for grocery retailers since any sales help retain the existing customer base, cherry pickers are still seen as a formidable opponent to retail grocers, said Talukdar.
"'Angels' buy high margin products, 'devils' buy low margin," he said. "I've been looking at it for the past three years because retailers suspect it's a problem."
A unique aspect of Talukdar's study is that he and his team not only compared prices between the two major stores, but also researched competitor pricing to compare deals during the same time period, he said.
"It's basically putting myself in the shoes of the consumer," he said.
Students in the School of Management also helped Talukdar collect data.
Talukdar, along with a former UB colleague and a former schoolmate who is now working at Yale, launched this study after taking interest in articles in The Wall Street Journal.
His study is currently being replicated in three other states.
Photo: Courtesy of Laron Fomby
