Impulse buying: The effect of decision time and product scarcity on buying impulse

Impulse buying is a critical and widespread phenomenon in consumer behavior and is considered a pervasive and distinctive aspect of consumers' lifestyles in the USA (Nguyen, et al., 2003).To increase their revenue, retailers make efforts to encourage consumers to make impulse purchases through point-of-purchase displays, price reduction promotions or coupons (Abratt & Goodey, 1990).;A scarcity appeal, one powerful selling tactic for retailers, has not been tested as an in-store stimuli to assess whether it could increase impulsive purchasing. This study suggests that providing an in-store promotion under a scarcity condition will increase consumer's impulsive buying and uncover mechanisms that explain this purchase behavior.;This study employs Brehm's (1966) psychological reactance as a theoretical foundation and investigated how a consumer chooses a product in a limited buying freedom condition. The purpose of this study was to examine the main effects of decision time and product scarcity on impulse responses. This study also examined the effect of two types of scarcity on perceived arousal and perceived competition, and further examined the interaction effects of two types of scarcity on the consumer's buying responses.;For data collection, an online experiment was conducted. Participants were recruited from Amazon.com's Mechanical Turk (MTurk). A 3 (decision time scarcity: 5 minutes vs. 1 hour vs. control (no decision time scarcity)) x 3 (product scarcity: 20 units left vs. 200 units left vs. control (no product scarcity)) between subjects design was used. Participants were randomly assigned to 1 of 9 conditions.;The results revealed product scarcity affected buying impulse and impulse buying decisions. However, there was no direct effect of decision time scarcity on buying impulse and impulse buying decision. There was an effect of decision time scarcity on perceived arousal, and there was an effect of product scarcity on perceived competition. Perceived competition was related to perceived arousal. Perceived arousal and perceived competition were related to buying impulse. No significant interaction effects for the two types of scarcity conditions on buying impulse and perceived competition were found. The only significant interaction effect was for decision time and product scarcity on perceived arousal.;This study has extends the psychological reactance theory (Brehm, 1966) to understand impulse buying behavior in a consumer behavior context. Also, this study contributes to the scarcity effect literature by empirically examining the effect of scarcity tactics on impulse buying behavior. In addition, the current study contributes to impulse buying literature by identifying external factors that might encourage consumer's impulse buying. Marketing implications based on the findings of the study are provided.