🎓 Coffee increases spending by 50%

Scientists gave free espressos (vs decaf coffee) to people entering stores. Customers bought ~30% more items and spent ~50% more, mainly on hedonic products.                                                                                                                                                                                                                                                                                                                                                                                                                 [Open in app]( or [online]() [🎓 Coffee increases spending by 50%]( Scientists gave free espressos (vs decaf coffee) to people entering stores. Customers bought ~30% more items and spent ~50% more, mainly on hedonic products. [Thomas McKinlay]( Nov 1   [Save]() [▷  Listen](   New to [Ariyh]( Join 14,418 evidence-based marketers for 3min practical insights 💡 from the latest scientific research 🎓 to get better marketing results 📈 [Subscribe]() --------------------------------------------------------------- Today’s insight is brought to you by… [Marketing Examined]( In Marketing, Genius is 1% inspiration and 99% execution.  Which is why [Marketing Examined]( writes all action, no fluff case studies to help you with both.  - Inspiration: Uncover the best growth strategies.  - Execution: A step by step playbook to help you implement.  - One simple promise: Become a better marketer every week.  Join 35,000+ marketers and founders for free weekly case studies. [Subscribe for free here]( --------------------------------------------------------------- 📢 Important - Ariyh is migrating to a new platform I’m moving Ariyh to another platform, from Substack to [Beehiiv]( (so I can grow Ariyh more effectively). What does it mean for you? Over the next weeks, you will start receiving Ariyh insights from a new email address ([team@mail.ariyh.com](. Please keep an eye out for it, in case it lands in your spam (Ariyh goes out every Tuesday). Aside from that and some minor design changes, nothing else should change. You will always find previous insights at [tips.ariyh.com](. While it shouldn’t happen, [thank you in advance]( for your patience in case there are some bumps down the road 🙏 The platform migration starts today and should conclude by mid-December. --------------------------------------------------------------- 📝 Intro What happens if you drink a coffee before entering a store or when shopping online? Does it change what you buy, or how many things you buy? Researchers asked 101 people what they expected would happen. Only 28 guessed right. Here’s what a series of 7 scientific experiments in France, Spain, and the US found ☕ P.S.: I posted a [quick summary of this study on LinkedIn]( and wow, I did not expect such a response. Over 180 comments and about 70,000 impressions. So here is the 3min practical summary for you. Now you have the full picture of the science and know how to apply it 😉 --------------------------------------------------------------- Previous insight: [Make people want to ‘grab’ your product]( (150+ more insights [here]( Caffeine drastically increases customer purchases of hedonic products Channels: Retail store | Ecommerce For: For B2C. Can be tested for B2B Research date: June 2022 📈 Recommendation Provide coffee or tea to customers before they shop with you. You can offer it for free or make it easily available (e.g. coffee machine at your entrance, café on your premises). Customers will buy more, especially if your experience or your products are fun and exciting (e.g. decor, fashion, travel, luxury). 🎓 Findings - People that consume caffeine (e.g. coffee, tea) before shopping spend more and buy more items. - As part of a series of 7 experiments, researchers: - Gave 145 customers of a home goods store in France either a caffeinated (100mg, a strong espresso shot), decaffeinated coffee, or a bottle of water. Those that drank the caffeinated coffee (vs decaf or water): - Spent more than double ($18.52 vs $9.06) - Bought 39% more items (1.50 vs 1.08) - Gave 221 U.S. students in a lab either caffeinated (34 mg) or non-caffeinated tea, and asked them how many items they would buy from a sample of a “relaxing gifts” page on Amazon. Those that drank the caffeinated tea chose 17.1% more items (3.83 vs 3.27) - The effect - Works mainly on sales of hedonic products, which tend to be exciting and fun (e.g. candles, home fragrances, plants). There is minimal impact on utilitarian products, which tend to be rational, planned purchases (e.g. insect-repellent candles, kitchen utensils, office supplies) - Is weaker on heavy coffee drinkers, who have more than two cups per day 🧠 Why it works - Caffeine is [one of the most powerful psychoactive stimulating drugs]( that we have legally and widely available. - When we consume it, we [release dopamine in the pre- frontal cortex of our brain]( which excites our body and mind. - This higher energetic state [increases our impulsivity and reduces our self-control](. - So we are more likely to impulse buy products that we find fun and exciting. --------------------------------------------------------------- 📥 Use this new technology to get 50% - 70% email open rates Here’s how this new email marketing technique works: - Step 1: [Inbox Mailers]( identifies when your subscribers are checking their inbox - Step 2: Inbox Mailers triggers your ESP to send an email while they’re checking it. This boosts opens, clicks, and… sales! [Here's how you can use this technique]( --------------------------------------------------------------- This announcement was sponsored. Want your brand here? [Click here](. ✋ Limitations - In the study, people were given low to normal amounts of caffeine (30 to 100mg). However, very high doses of caffeine (over 300mg) [may cause anxiety and nervousness]( rather than positive excitement. Does the effect hold in these cases, or does it backfire? - Researchers focused on people’s spending after they consumed caffeine. But could the smell of coffee - or just the thought of it - trigger a similar effect? - Caffeine was the focus of this study. But other drugs such as amphetamines and cocaine have [some similar effects](. As opposed to caffeine, these drugs impair cognition, but just like it they cause [impulsivity and loss of self-control](. Do these drugs have a similar effect on spending? (Regardless, it’s probably not a good idea to give free cocaine to shoppers) 🏢 Companies using this - Some retailers offer coffee in or near their stores, although it usually seems to be intended as a special benefit rather than a technique to directly increase sales. - Waitrose has experimented with giving [free coffee to members of its loyalty program](. Some other grocery stores such as Trader Joe’s and New Seasons Market have also at times given free coffee. - Non-grocery retailers such as Target, Barnes & Noble, Polo Ralph Lauren, Nordstrom, and H&M occasionally have in-store coffee bars. - Mercedes-Benz uses a “Bistro-Bar-Lounge-Showroom” concept which seems to have [notably increased sales]( - although it is unclear how much free coffee contributed to that. ⚡ Steps to implement - Think of ways that you can integrate caffeine into your retail experience (mainly coffee or tea, depending on the culture you are operating in). - The beverages can be free, subsidized, or full-price, depending on your cost-benefit analysis. Giving them for free or at rock-bottom prices may trigger beneficial [feelings of reciprocity]( from customers toward you. - For example: - If you are a larger retailer, encourage a cafe to open within or near your premises. - If you are a small or medium-sized supermarket, place a coffee machine near the entrance of your store - If you are a premium retailer, [make it a ritual]( to offer a beverage to your customers, before helping them with their purchases --------------------------------------------------------------- 🔍 Study type Lab and field experiments (in 3 different stores in France and Spain). 📖 Research [Caffeine’s Effects on Consumer Spending](. Journal of Marketing (June 2022). 🏫 Researchers - [Dipayan Biswas](. University of South Florida - [Patrick Hartmann](. University of the Basque Country UPV/EHU - [Martin Eisend](. European University Viadrina and Copenhagen Business School - Courtney Szocs. Louisiana State University - [Bruna Jochims](. SKEMA Business School - [Vanessa Apaolaza](. University of the Basque Country UPV/EHU - [Erik Hermann](. Deutsche Payment - [Cristina Maria López](. Basque Country UPV/EHU - [Adilson Borges](. NEOMA Business School Remember: This is a new scientific discovery. In the future it will probably be better understood and could even be proven wrong (that’s [how science works](. It may also not be generalizable to your situation. If it’s a risky change, always test it on a small scale before rolling it out widely. --------------------------------------------------------------- Rate today’s insight to help me make Ariyh's next insights 🎓 even more useful 📈 How was today’s insight? [Loved it]( | [Great]( | [Good]( | [Meh]( | [Bad]( - 📘 Want to optimize your pricing? Get [Ariyh’s Science-based Playbook of Pricing & Promotions]( - 📣 Want to advertise on Ariyh? 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