Consumers need to change their behavior before companies change their prices.
Q1 2024 saw massive declines in Starbucks and other fast food retailers. So I already knew about this trend. After waiting it out, companies are finally counteracting and offering discounts/deals.
This delay in consumer behavior and prices is strange to watch but easy to understand. Higher prices never stop my current purchase, they only make me think harder about my next purchase.
Just speaking from personal psychology here. If I’m already at McDonalds or whatever and prices are higher than I expect… I delay my next trip to McDonalds but I finish my order today.
Similarly, I don’t really look at advertisements. So deals or whatever don’t entice me, because I don’t know about them.
Only after I visit do I see the price drops or discounts and deals, and then it only really affects my next visit. Because I already have decided on a Big Mac so I don’t care that the nuggets are 20% off. When I feel like nuggets later that’s when I’ll think about the deal.
That’s an interesting observation. Never thought about it that way but you’re right for some of us. My wife, on the other hand, knows about the deals and specifically will go when they come up. So for others it does work that way.
She likely knows because she either has the app installed; or listens and learns through her peers about the deals that might be ongoing.
So while that may make it look like you’re on the right track; it still requires that first, the company must offer a discount or “deal” to get people into the door. Many purchases still are made on the basis of prices learned during the last visit; and the price can leave a lingering impact on future visits.
When the ‘Main’ brings their family of 4 to McDonalds and finds out that the bill for that outing went up by 10% or even 15%, they still have the potential to be peeved about that; and will remember that. That may mean that later the family decides to go to McDonalds fewer times a week for a time. That’s when a company begins to feel a squeeze…a few quarters of that later.
You’re not wrong either. What really happened is that McD’s ended up being in the same total price range for our family as other sit down restaurants that are far better so we choose them instead, unless were traveling.
Consumers need to change their behavior before companies change their prices.
Q1 2024 saw massive declines in Starbucks and other fast food retailers. So I already knew about this trend. After waiting it out, companies are finally counteracting and offering discounts/deals.
This delay in consumer behavior and prices is strange to watch but easy to understand. Higher prices never stop my current purchase, they only make me think harder about my next purchase.
Just speaking from personal psychology here. If I’m already at McDonalds or whatever and prices are higher than I expect… I delay my next trip to McDonalds but I finish my order today.
Similarly, I don’t really look at advertisements. So deals or whatever don’t entice me, because I don’t know about them.
Only after I visit do I see the price drops or discounts and deals, and then it only really affects my next visit. Because I already have decided on a Big Mac so I don’t care that the nuggets are 20% off. When I feel like nuggets later that’s when I’ll think about the deal.
That’s an interesting observation. Never thought about it that way but you’re right for some of us. My wife, on the other hand, knows about the deals and specifically will go when they come up. So for others it does work that way.
She likely knows because she either has the app installed; or listens and learns through her peers about the deals that might be ongoing.
So while that may make it look like you’re on the right track; it still requires that first, the company must offer a discount or “deal” to get people into the door. Many purchases still are made on the basis of prices learned during the last visit; and the price can leave a lingering impact on future visits.
When the ‘Main’ brings their family of 4 to McDonalds and finds out that the bill for that outing went up by 10% or even 15%, they still have the potential to be peeved about that; and will remember that. That may mean that later the family decides to go to McDonalds fewer times a week for a time. That’s when a company begins to feel a squeeze…a few quarters of that later.
You’re not wrong either. What really happened is that McD’s ended up being in the same total price range for our family as other sit down restaurants that are far better so we choose them instead, unless were traveling.