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.
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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
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).
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)
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.
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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.
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).
Caffeine’s Effects on Consumer Spending. Journal of Marketing (June 2022).
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.
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